The state’s unemployment rate dropped to 6.8% in January, down a tick from December’s 6.9% rate but double the record low of 3.4% in May 2019. It is unclear what effect the mid-February winter storm had on employment, when power outages swept the state and many roads were impassable. We’ll find out next month.
What is certain is that state lawmakers must grapple with a revenue shortfall as they build a biennial budget, since sales tax revenues are down from the previous year. The state comptroller’s office announced February sales tax revenues totaled $2.68 billion, down 7.5% from the same period last year.
Sales taxes account for most of the state’s revenues. Texas Comptroller Glenn Hegar announced in January that the state was running a $1 billion deficit for the current budget. Hegar estimated state budget writers will have an estimated $112.5 billion in revenue available for the next two-year budget, which is nearly $500 million less than the total current budget.
