Dallas−Fort Worth Economic Indicators

The Dallas−Fort Worth economy expanded in March. Employment grew across most sectors, and average earnings picked up. In the first quarter, office vacancies increased, while industrial vacancies dipped.

Labor market

Payrolls expand

DFW employment grew an annualized 2.8 percent in March after expanding 2.1percent in February (Chart 1). Employment rose at a similar pace in Dallas (2.8 percent) and Fort Worth (2.9 percent). Payrolls in March expanded 1.4 percent in Texas and 1.7 percent in the U.S.

Employment rises in first quarter

DFW employment grew an annualized 2.2 percent in the first quarter, faster than the fourth quarter’s 1.2 percent increase (Chart 2). First-quarter employment gains were robust in construction, leisure and hospitality, government, and education and health services. Payrolls in manufacturing were flat, while employment contracted in financial activities and professional and business services. First-quarter employment growth in DFW was faster than in the state (1.9 percent) and the U.S. (1.2 percent).

Hourly wages edge up

DFW average private hourly earnings ticked up to $36.60 in March, slightly up from February’s figure of $36.33. The three-month moving average for hourly earnings edged up to $36.28, above the state average of $34.24 and the national average of $35.91 (Chart 3). In the past year, average wages in DFW have increased 6.4 percent, faster than gains of 5.7 percent in Texas and 3.8 percent in the U.S.

Commercial real estate

Office vacancy continues to creep up

Demand for office space in DFW remained weak in first quarter 2025. Net absorption was -305,000 square feet, pushing up the vacancy rate to a multiyear high of 27.2 percent, according to data from CBRE Research (Chart 4). The metroplex had 62 million square feet of vacant office space in the first quarter, and availability of sublease space increased to 8.5 million square feet.

Industrial leasing stays solid

Industrial demand remained healthy in the first quarter. Net absorption was 4 million square feet, similar to the amount of space absorbed in the fourth quarter, according to CBRE (Chart 5). The northeast Dallas and north Fort Worth submarkets were the most active in terms of leasing demand last quarter. The vacancy rate dipped to 9.1 percent, and space under construction increased from 10.8 million square feet to 11.9 million square feet.