Federal Reserve Bank officials predict slow, positive growth in 2015
Falling oil prices have some economists concerned
SAN ANTONIO – Texas will see slow but positive job growth this year, according to the Federal Reserve Bank of Dallas' 2015 economic forecast.
Speaking at a luncheon Tuesday, the regional reserve bank's senior economist, Keith Phillips, told dozens of business leaders that he expects the number of jobs to increase statewide by 2-2.5 percent, which is closer to the national average. Phillips said the final number will depend on how far oil prices fall this year.
"Moving from $80 to $50 (per barrel) is going to have a negative impact," Phillips said. "We're going to see some sharp declines in the oil and gas regions of the state. Production will continue at high levels, but the new drilling activity will fall off and that's going to affect regions south of here and the Eagle Ford Shale."
Even with falling fuel prices, Phillips said the reserve bank was already forecasting slower growth. Wild swings in oil prices are not new to Texas. In the 1980s, volatility in the oil market caused an economic downturn in the Lone Star State. Phillips said he's not worried about a repeat performance.
"I think we're much more diversified (economically) now than we were in the '80s," he said. "There won't be the type of big declines in real estate and financial industries that we saw in the '80s."
The bank predicts San Antonio will see a 3 percent increase in job growth, which equates to about 28,000 new jobs.
"I think San Antonio might slow this year as the state slows, but I don't think it will slow as much," Phillips said.
Janie Barrerra, president and CEO of local small business lender ACCION Texas, said her clients are excited about the potential for success in 2015, and they're thankful for falling fuel prices.
"What that means to consumers and small business owners is that they're able to make a bigger impact in the growth of their small business," she said.
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