Unique local economy mirrors state trend, report says

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WACO, Texas (KWTX) Data released in January by the Texas State Comptroller’s Office indicates the unique economy that makes up Central Texas “is a microcosm of the state,” but closer examination shows how unique this microcosm really is.

The new report is an examination of regional economic trends “including population, education, transportation, construction, mining, agriculture, personal income, jobs and wages and education, as well as economic conditions and characteristics unique to the Central Texas Region.”

“It’s a pretty positive summary for the Central Texas economy,” Dr. Paul Stock, economist at University of Mary Hardin Baylor, said,

“The region withstood the 2008-2009 recession really well, better than other parts of the state, and as others continued to fight back, we just kept on growing.”

From the very beginning the report from the state office shouts about how unusual the Central Texas economy is, actually how unusual the three Central Texas economies are: three distinct economic centers identified as Killeen-Temple, Waco and Bryan-College Station, everyone an individual Metropolitan Statistical Area (MSA), and all coming together to form the region.

The triple-based economy works like no other in the state where in every other case the across Texas the MSA relates to only one city, not to three, Stock said.

“I certainly don’t see any negatives in the report,” Dr. Dennis Jansen, director of the Private Enterprise Research Center at Texas A&M University said, “We’re growing and it’s stable growth.”

“Adding to the uniqueness of the tri-centered economies is the huge list of economic variables and challenges, many mitigated by long-standing and continued population growth, a median age that is significantly younger than Texas as a whole and a track record of significant employment growth rate, while slightly below the state average, wage growth is almost double that statewide.”

The Killeen-Temple MSA is the regional data leader in the comptroller’s report, primarily because the U.S. Army at Fort Hood has had a meaningful impact on the Central Texas Region’s local economies for years and that impact continues to grow.

Stock said standouts noted in the Central Texas report show increases in construction, education, government, agriculture, mining and paper production.

Agriculture plays a big part, he said, and has pretty much for the history of the state, but the region also shows strong growth in home building, business and infrastructure construction, and with a dozen avenues to higher learning, education is a very strong point, too.

But the U.S. Army and Fort Hood make the biggest splash, both here and in the state.
“Fort Hood is the largest military base in the world and is the largest employer in Texas,” Stock said, “so when Fort Hood does good, we all do good.”

There are 13 military installations in Texas, which in 2017 employed more than 224,000 individuals and in total supported 625,000 jobs that in the aggregate contributed $62.3 million to the state’s gross domestic product, the report says.

Of that statewide total Fort Hood supported 150,000 jobs in the region and contributed about $15.1 billion to the state’s GDP.

Stock said the overall economic impact of Fort Hood is virtually impossible to quantify because it filters down to almost every aspect of its neighboring communities and some of that goes unseen.

The comptroller considers the region to include 20 counties: the College Station-Bryan MSA: Brazos, Burleson and Robertson counties; the Waco MSA: Falls and McLennan counties; and the Killeen-Temple MSA made up of Bell, Coryell and Lampasas counties.

The balance on the regional list are not necessarily associated with one of the three population centers and include Bosque, Freestone, Grimes, Hamilton, Hill, Leon, Limestone, Madison, Milam, Mills, San Saba and Washington.

Population-wise the College Station-Bryan MSA is smallest with approximately 258,000, about 21 percent of the region’s population and about 1 percent of the state’s; Waco MSA’s population is center at approximately 269,000, about 22 percent of the region’s total population and about 1 percent of the state’s; and largest is Killeen-Temple MSA’s population at about 444,000, or about 37 percent of the region’s total population and 1.5 percent of the state’s, the Comptroller’s report says.

The Central Texas Region’s estimated total population in 2017 was 1.2 million, or about 4.6 percent of the state’s total population, the report points out.

That represents an increase of about 8 percent, more than 88,000 people since the 2010 census, with 29 percent of the region’s population concentrated in Bell County, part of the Killeen-Temple MSA.

From 2010 to 2017, the region’s population grew at a slightly slower rate than the rest of the state as a whole while but within the region Brazos County outpaced all others, growing by more than 14 percent, a bit higher than the state average of 12.6 percent growth.

According to a recent census analysis, the median age of the residents of the Central Texas Region’s counties is on par with the state as a whole. Three of the region’s 20 counties have a median age significantly younger than the state median age of 34.2 years.

These three – Bell (30.4 years), Brazos (25.5 years) and Coryell (31 years), combined with McLennan (33 years) – make up a majority of the region’s population.

In fact, Brazos County has one of the youngest populations in the state.

The College Station-Bryan and Killeen-Temple MSAs both had median ages significantly lower than the state.

The Waco MSA has a median age similar to the statewide median.

“The 20-county Central Texas Region covers about 17,400 square miles in the heart of Texas, stretching from Hillsboro on the north to Interstate 45 on the east, to East Yegua Creek on the south to the conjunction of the San Saba and Colorado rivers.

“The region has a population density of 70 people per square mile, less than the state average density of 108 people per square mile,” the state report says.

Texas has more than nine million households and income among them “is more or less evenly distributed among five income levels,” the comptroller’s report points out.

Of that number “22 percent have incomes less than $25,000, and 16 percent have incomes exceeding $125,000.

“In every region of the state, nearly 18 percent of households have an average income between $50,000 and $75,000,” the report says. The average household income in the Central Texas region is slightly less than the statewide average: “only 29.2 percent of the region’s household incomes are greater than $75,000, versus 36.3 percent for Texas as a whole, the disparity likely attributable to the younger median age of residents in three of the region’s four most populous counties.”

Stock said the lower pay numbers likely were because so many of the jobs in Central Texas were not-so-high-paying government jobs or jobs in education which traditionally don’t pay really well, growth in wages to nearly double the growth rate in both Texas and the U.S. is an extremely positive sign.

Approximately 57 percent of the Central Texas Region’s total population is white (not Hispanic) – 14 percentage points higher than non-Hispanic whites’ 43.4 percent share of the state population. In the region population exhibits the following: 14.6-percent black (non-Hispanic), 22.6-percent Hispanic. 57.2-percent white (non-Hispanic) and 5.5-percent other races, according to the Comptroller’s report, data for which was provided by the U.S. Census Bureau.

Those numbers are very different from statewide numbers that reflect 11.6-percent Black (non-Hispanic), 38.6-percent Hispanic, 43.4-percent white (non-Hispanic) and 6.3-percent other races.

Employment totals throughout the Central Texas region increased by 13 percent between 2007 and 2017, which was slightly slower than the state job growth rate but rapid enough to account for 3.6-percent of total employment in Texas.

College Station-Bryan MSA showed the biggest growth with an increase of more than 22 percent; nearly 19 percent in the Killen-Temple MSA and about 8 percent in the Waco MSA, the comptroller said.

Some 32-percent of the region’s jobs are located within the Killeen-Temple MSA, the Waco MSA accounts for 26.6 percent and College Station-Bryan for 25 percent, the report says.

Those figures were based upon data provided by the U.S. Department of Labor, the report said, and they are good, but when it comes to getting paid for the jobs Central Texans do, the picture gets cloudier.

About $43,046 was the average wage in Central Texas in 2017, significantly less than the state average of $55,801 and the national average of $55,375.

“Adjusted for inflation, individual wages in the Central Texas Region increased 10 percent during the 10-year period” between 2007 and 2017, the report said.

Stock said among the biggest sectors of the Central Texas economy is transportation, which is evidenced by two Interstate highways that run through the region, a statewide railroad hub in Temple and lines running through Bryan, plus three commercial airports, one each in Waco, Killeen and Bryan.

That transportation infrastructure also allows for thousands of tourists to visit here, whether they’re coming to see Fort Hood, Magnolia, Baylor or the Waco Mammoth Site, and they all leave money and then go home and tell their friends to come.

In summary, the report says: “Based on data from the World Bank and the U.S. Bureau of Economic Analysis, if Texas were a nation, it would rank as the world’s 10th largest economy in terms of GDP.

“The Central Texas Region ranks with other states and the nation on a number of demographic and economic measures.

“Were it a separate state, the region would be the 42nd largest in the union in terms of land mass (square miles) and have the 43rd largest population,” the report says.

The region also would have the 22nd lowest unemployment rate for 2017.