Dallas Fed Sees Continued Contraction in TX Service Sector
The Texas service sector continued to see a dramatic contraction in April amid COVID-19 and mitigation measures, according to the Dallas Fed’s Texas Service Sector Outlook Survey. The revenue index, a key measure of state service sector conditions, inched up just slightly from an all-time low of -67.0 in March to -65.4 in April.
Labor market indicators reflected steeper declines in employment and further shortening of workweeks. The employment index fell from -23.8 to -35.2, its lowest reading on record. Over half of respondents have now cut employee hours.
Perceptions of broader business conditions remained extremely pessimistic in April, while uncertainty continued to escalate. The general business activity index declined nearly three points to a new low of -81.7, while the company outlook index improved nearly six points but remained deeply in negative territory. Meanwhile, the outlook uncertainty index rose from 37.6 in March to a new high of 43.2.
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