2018 has started off mixed for Amarillo’s economy, as a strong labor environment is offset by drought conditions and a slowdown in construction.
There are more people working in Amarillo, and we have the 2nd lowest unemployment rate in Texas, just barely behind Midland. The Household Survey shows we have 2,000 more people working than a year ago, and the Employers’ Survey shows an increase of 1,800. Lubbock is up 2,100 and 1,500 in the same surveys, and Midland/Odessa is up 4,200 and 3,800 as Permian activity is scorching.
Retail Sales are up for the month compared to a year ago for the first time in 7 months. New Car Sales are down 62%, and Used Car Sales are down 9%.
Airline Boardings are flat and hovering around 30,000 per month. The Hotel / Motel tax is up 8%.
Mortgage Rates are higher, with the 30-year at 4.375%, as the 10-year Treasury inches up. Residential Starts (41) are flat with a year ago (39). Building permits are down 65% from a year ago, but the downtown ballpark will boost those numbers in the coming months.
We are off to a scary start to the year in regards to moisture. Drought and windy conditions mean much dryland winter wheat will be grazed out by cattle. Wheat prices are up 30% from a year ago, and corn is up 7%.
Profit margins are getting squeezed at area dairies, as prices are down 11% to $14.75. Area feedyards are seeing losses around $25 per head, with Fat prices at $119.
We will keep our eyes on moisture and the very tight labor market in our area.
*Base-100, January 1988
This document was prepared by Amarillo National Bank on behalf of itself for distribution in Amarillo, Texas and is provided for informational purposes only. The information, opinions, estimates and forecasts contained herein relate to specific dates and are subject to change without notice due to market and other fluctuations. The information, opinions, estimates and forecasts contained in this document have been gathered or obtained from public sources believed to be accurate, complete and/or correct. The information and observations contained herein are solely statements of opinion and not statements of fact or recommendations to purchase, sell or make any other investment decisions.
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