Despite the fact that Texas unemployment is at its lowest level in history, the Federal Reserve Bank of Dallas, in its quarterly report on the state's economic outlook, is warning of storm clouds in the second half of the year, News Radio 1200 WOAI reports.
"The recent spike in trade related uncertainty, companies inability to find skilled labor, and a slowing global economy," are the three challenges to the Texas economy in the coming months, senior Fed economist Anil Kumar said.
Texas is the largest experter in the country by far, and exports more by itself than all but 18 nations. That means Texas manufacturing is particularly at risk as tariffs continue to mount.
Tariffs are also starting to hit the oil and gas industry as well. In fact, oil and gas employment in May fell across Texas.
The lack of skilled labor is the most vexing problem facing the state's attempt to expand its economy. With the state's unemployment rate around 3%, it is very difficult for employers to find the workers they need in order to expand to meet growth opportunities.
Kumar says the state's red hot housing market has begun to cool off, with the rise in selling prices levelling off in many cities. He says the employment picture is showing signs of peaking as well, with San Antonio actually seeing a decrease in jobs in May.