September 2023
Lubbock's economy shows mixed results going into the last quarter of the year. Interest rates continue to have an effect on commercial and residential building activity, new vehicle sales are up, employment remains steady, tourism has improved and retail sales continue to grow. Inflation is still a factor in retail sales being up. The Federal Reserve Bank paused interest rate increases in September. As the Lubbock economy moves into fourth quarter, we will see some ups and downs in various segments of the economy.
Retail sales for August 2023 are up 4.90%, compared to August 2022. YTD retail sales are up 3.63% from last year, both month to date and year to date retail sales have increased primarily due to inflation costs. New vehicle sales saw a 22.94% increase from last August, while used vehicle sales are up 1.96%. Better inventories of new vehicles accounts for new vehicle sales.
Travel is up with Hotel/Motel tax collections up 46.13% from last August, and Airline boardings up 9.64%. Tourism has improved and continues to remain strong.
Workers Employed are up 2,565 over the last 12 months on the Employer Survey and 2,200 on the household survey. The labor force has increased 1.96% compared to August 2022, and wages are flat. Unemployment is higher at 3.90% compared to 3.50% last year at this time. Overall employment has remained strong and resilient.
August Building Permits totaled $90 million, down $242 million from last year. There were 179 new residential starts in August, up 37.69% from last year. Housing starts show improvement but still down in number of starts year to year. Interest rates being a large factor. The median house price was $243,000, down 2.51% from one year ago.
Commercial building activity YTD is down $148 million from last year. There were 219 new commercial starts in August up from last year 40%. Although new commercial starts are up for commercial projects, they are smaller in nature compared to the larger projects permitted in 2022. In August there were two larger projects permitted one for the City of Lubbock $8 million and a new credit union for $6 million.
Oil prices compared to last year are up 5.70% and natural gas has dropped by 67%. Our rig count has decreased from 25 to 12 from July to August 2023. Wheat is down 24.75% and corn is down 31.71%, while cotton has dropped 30.35%. Fat cattle are up 32% from one year ago, while milk prices are down 12.35%. Even with some recent rains the drought that has persisted will have an impact on the overall agricultural economy with yields being down on crop production.
Economic Pulse
| Economic Components | Current Month | Last Month | Last Year |
|---|---|---|---|
| Sales Tax Collections | $ 8,140,563 | $ 9,114,605 | $ 7,759,982 |
| Sales Tax Collection-YTD | $ 75,242,836 | $ 67,102,273 | $ 72,605,536 |
| New Vehicle Sales | 1,002 | 975 | 815 |
| Used Vehicle Sales | 2,083 | 2,027 | 2,043 |
| Airline Boardings | 47,045 | 48,427 | 42,909 |
| Hotel/Motel Receipt Tax | $ 966,050 | $ 703,516 | $ 661,076 |
| Population | 263,648 | 263,648 | 263,648 |
| Employment - CLF | 171,307 | 171,682 | 168,007 |
| Unemployment Rate | % 3.90 | % 4.10 | % 3.50 |
| Total Workers Employed (Household Survey) | 164,689 | 164,711 | 162,124 |
| Total Workers Employed (Employers Survey) | 158,200 | 158,100 | 156,000 |
| Average Weekly Wages | $ 1,014.00 | $ 1,014.00 | $ 1,021.00 |
| Gas | 77,690 | 77,479 | 76,152 |
| Interest Rates: 30 Year Mortgage Rates | % 7.250 | % 7.375 | % 7.125 |
| Building Permits Dollar Amount | $ 90,324,407 | $ 252,545,032 | $ 332,482,637 |
| Year to Date Permits | $ 977,522,715 | $ 887,198,309 | $ 1,312,085,884 |
| Residential Starts | 179 | 158 | 130 |
| Year To Date Starts | 1,270 | 1,091 | 1,756 |
| Median House Sold Price | $ 243,000 | $ 242,000 | $ 249,250 |
| Drilling Rigs In Panhandle | 12 | 25 | 8 |
| Oil Price Per Barrel | $ 89.93 | $ 82.47 | $ 85.08 |
| Natural Gas | $ 2.76 | $ 2.79 | $ 8.27 |
| Wheat Per Bushel | $ 6.81 | $ 7.07 | $ 9.05 |
| Fed Cattle Per CWT | $ 187.87 | $ 183.06 | $ 142.00 |
| Corn Per Bushel | $ 4.63 | $ 4.76 | $ 6.78 |
| Cotton (Cents Per Pound) | $ 81.08 | $ 78.86 | $ 116.41 |
| Milk | $ 17.75 | $ 17.31 | $ 20.25 |
| Index* | $ 299.83 | $ 395.39 | $ 554.23 |
*Base-100, January 1988
This document was prepared by Lubbock National Bank on behalf of itself for distribution in Lubbock, 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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2023 Economic Analysis
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