Trade wars, rising world tensions, and a contentious run-up to the next presidential election have injected much uncertainty into the markets. Despite these distractions, the overall U.S. economic outlook is healthy according to the key indicators. Inflation or deflation has not been problematic, and interest rates are expected to stay low. The pace of growth is slowing, but this is not surprising after nearly a decade of above-average expansion. The U.S. 2020 economic outlook is fundamentally solid according to the latest opinions of economic experts.
GDP Growth Rate – In December 2019, a forecast was released at the Federal Open Market Committee meeting. It stated that the GDP growth rate would likely slow to 2%. Despite subdued economic growth, a recession is unlikely.
Unemployment – Fed officials and many economists have long expected monthly job growth to slow down. The unemployment rate is forecast to average 3.5% in 2020. Many businesses report that it is getting harder and taking longer to fill open positions.
Jobs – Health care will account for most of the fastest-growing occupations in 2020 and beyond. Jobs in alternative energy production will grow rapidly, as will computer and math occupations.
Wages – 26 states and the District of Columbia raised their minimum wage in 2020. The federal minimum wage rate is $7.25. New York City’s minimum wage is now $15.00 per hour, while most of the remainder of the state is $11.80 per hour. California will raise its minimum wage by $1 to $13.00 per hour; however, the highest state rate is Washington at $13.50 per hour. Some analysts praised the move – others warn of job cuts.
Texas is an economic engine on its own. It is the second-largest economy in the country and the tenth-largest in the world. According to the Texas A&M Research Center’s latest report, Texas’ economic growth slowed at the end of 2019 but remained positive. Job growth in 2020 will likely remain close to the 1.7% pace of 2019. Unemployment should remain near its historic low. Here are some factors that are unique to the Texas economy and will impact the state’s 2020 outlook:
Oil & Gas – Energy analysts vary in their predictions for the oil and gas industry, but most don’t expect to see higher profits in 2020. About half of oil field service firms plan to cut spending according to the most recent quarterly energy survey published by the Federal Reserve Bank of Dallas. The current count of 796 national rigs is the lowest since March 2017, when the industry was recovering from the last oil bust. Texas has the lion’s share of active rigs with 403 of the nation’s total.
Business-Friendly – Texas is widely recognized as business-friendly. There is no corporate income tax, the minimum wage is low, the workforce is robust, and the regulations are predictable. The state is ranked fourth for economic climate and first for growth prospects. Over 100 of the 1,000 largest public and private companies in the U.S. call Texas home, with more relocating to the area every day.
Booming Population – Texas’ population growth has been one of the keys to its economic success. The state’s population has gained millions of residents in the past ten years, and the trend shows no signs of reversing.
The experienced professionals at The Daniel Group can help with all your staffing needs from entry-level to seasoned experts. We have a proven track record of finding and qualifying the best candidates, and we can find the right talent to fill your company’s needs. The Daniel Group stands behind our work with a One-Year Replacement Guarantee.