May 26, 2022
El Paso’s economic growth was relatively flat in April. The metro business cycle index rose slightly. Employment was little changed and the unemployment rate rose. Although still above pre-pandemic levels, job posting growth has slowed. Weekly closed and pending home sales suggested a cooling in the housing market. Industrial production and manufacturing output in the United States increased.
Business cycle index
The El Paso Business Cycle Index rose 0.7% annualized in April after rising 1.7% in March (Chart 1). Compared to April 2021, the index is up 5.2%.
Wage bill falls again
El Paso’s total nonfarm payrolls were essentially flat in April, down 0.1% (34 jobs) after falling in March (Chart 2 ). Sectors that lost jobs included trade, transport and utilities (290 jobs), leisure and hospitality (90), manufacturing (60) and government (50). The declines were almost offset by job gains in professional and business services (300 jobs) and construction and mining (80).
Compared to the same month last year, employment in the metro increased by 2.8%, or 8,830 jobs. Payroll gains were widespread over the period, with significant gains in leisure and hospitality (4,290 jobs), trade, transport and utilities (2,010), government (850) and education and health services (810). Professional and business services was the only sector with employment below April 2021 levels, down 220 jobs.
El Paso’s unemployment rate fell from 4.4% to 4.5% in April. By contrast, the Texas figure fell to 4.3%, while the US rate remained at 3.6% in April.
Job vacancies trending lower but still high
Job postings data from Indeed.com shows that openings remain well above pre-pandemic levels in the El Paso area, although they have been on a downward trend since late 2021 (Chart 3). As of May 13, local job postings were 47.8% higher than February 1, 2020. However, this figure is 17.1 percentage points lower than December 31, 2021, when local job postings in the subway peaked. Job postings relative to February 1, 2020 for Texas and the United States were 59.0% and 55.6% higher, respectively.
El Paso’s housing market slowed in mid-May, largely due to tight inventories and rising mortgage prices and rates. According to high-frequency data from Redfin, the four-week moving average of homes sold fell 2.1% to 191 units between the weeks ending April 17 to May 15 (Chart 4). Compared to the previous year, the total number of homes sold decreased by 2.7%. Pending home sales fell 7.5% to 163 units between the weeks ending April 17 to May 15. Year-over-year, pending home sales were down 2.6%. Active listings in the metro totaled 1,161 units as of May 15, down 3.2% from the April 17 level and 33.2% lower than a year ago.
Industrial production and activities related to maquiladoras
The monthly index of industrial production (IP) for the United States rose from 104.5 in March to 105.6 in April and was up 6.4% from a year ago (Chart 5). Mexico’s IP index rose from 100.2 in February to 100.6 in March and was 2.4% higher than a year ago. The Institute for Supply Management (ISM) manufacturing index fell from 57.1 in March to 55.4 in April and was down 5.2 percentage points from a year ago. Although the ISM index hit its lowest level since July 2020, the figure remains above 50, indicating an expansion in the manufacturing sector. Comments from ISM panelists indicated that supply constraints continued to hamper growth and improvements in labor availability have slowed. While a slight easing of price pressures was observed, panelists noted that volatility in the energy market continued.
US production of automobiles and light trucks fell from 9.5 million units in March to 10.3 million in April. Monthly auto sales also increased, from 13.4 million in March to 14.3 million in April. Industrial and automotive activity is closely tied to the economy of the El Paso area due to cross-border manufacturing relationships. About half of the maquiladoras in Juárez are automotive related.
NOTE: Data may not match previously published figures due to revisions. The El Paso Metropolitan Statistical Area includes El Paso and Hudspeth counties.
About El Paso Economic Indicators
Questions can be directed to Keighton Hines at [email protected] El Paso Economic Indicators is released monthly after the release of state and metro employment data.