Report: Industry Diversification in Texas Shows Economic Stability
From Texas Standard:
Falling gas prices is great news for us as consumers, yet some are panicking about the state's economy. But the future of Texas may not be so gloomy after all.
The federal reserve bank of Dallas has released a report showing that, although the economy is slowing down, there is a silver lining after all. Senior economist Pia Orrenius, vice president of the Federal Reserve Bank of Dallas, says that there are large "industry clusters" around state where the economy is stable.
She says industries with high-paying jobs – like government, technology, construction, biomedical and defense – may not grow very quickly, but they don't tend to lose jobs.
"(Researchers) look at the question of why cities tend to grow faster," she says. "They tend to grow faster because firms tend to group into industries and specialize, so certain regions are specialized in certain industries. This increases productivity growth. It raises wages for workers and it has a lot of benefits on growth."
Orrenius says the report shows a surprising diversification in industry in places like San Antonio, one trend that mimics the nation as a whole.
"You really see some interesting insights," she says. "We know that Houston is a huge center of the oil and gas industry in the nation, but then you see that Dallas, for example, has a very large concentration of professional and business services."
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