Recession fears are beginning to create ripples in the Texas economy, especially in the pandemic-era hot housing market fueled by historically low interest rates.
With the Federal Reserve now raising rates to tamp down inflation, companies that benefited from the runup are facing the reality of a slowdown in mortgage refinancings and a tight supply of homes for sale.
In June, Plano-based First Guaranty Mortgage Corp. laid off the majority of its staff, terminating 428 of its 565 employees, according to a notice the company provided to the Texas Workforce Commission. Zillow Group Inc. has cut 55 Texas-based jobs since the beginning of the year as it continues its exit from the home-flipping business, and banking giant JP Morgan Chase & Co. laid off or reassigned hundreds of home-lending employees across the country.
Last week, Dallas life insurance startup Bestow laid off 14% of its workforce, affecting 41 employees, in what it said was a response “to the changing market conditions.” It had announced plans in February to hire up to 150 more workers this year as the firm looked to build on strong revenue growth over the last couple of years.
In Texas, companies file Worker Adjustment and Retraining Notification Act layoff notices with the Texas Workforce Commission. The 1988 law requires companies with 100 or more employees to provide 60 days notice of closings or mass layoffs. It’s intended to give employees time to potentially find new work or train for new positions.
Here are the Texas employers filing WARN notices so far this year.
The Texas economy, however, continues to add jobs at a much faster rate than it loses them.
Private employers in the state added 74,200 jobs in May — the biggest increase of the year — as three more sectors of the state’s diverse economy surpassed pre-COVID employment levels. Texas was one of seven states where nonfarm payrolls grew in May, according to a report from the U.S. Bureau of Labor Statistics.
May’s employment growth also means Texas has added 762,400 jobs in the last year, an increase of 6.1%.
“Despite headwinds such as inflation, worker shortages, supply-chain problems, and geopolitical tensions, the Texas economy continues to generate jobs at an impressive pace, and the stage is set for long-term growth,” wrote Waco economist Ray Perryman in his weekly blog post.
