Economic Analysis |
June 2022The Lubbock Economy continues to remain strong coming out of the pandemic, Lubbock’s highly skilled and educated workforce, proximity and connection to major national and international markets, and affordable utility and living costs drives the local economy. Lubbock’s diverse economy based on manufacturing, agriculture, wholesale and retail trade services, as well as government, education and health care move the business and employment opportunities that drives the Lubbock economy in 2022. Retail sales for May 2022 are up 4% when compared to May 2021 and 25% from three years ago. New vehicle sales are down 25% from last May due to supply shortages, and down 10% from May 2019. Used vehicle sales are down 8% compared to May 2021, and down 9% from three years ago. Tourism is recovering, with strength in the motel tax collections, which is up 35% compared to May 2021 and up 4% compared to three years ago. Airline boarding’s are continuing to recover, indicated by the 23% increase since May 2021; however, they are still down 3% when compared to 2019. Workers employed are up 5,000 over 12 months ago on both the household and employer survey. The labor force has increased 2% compared to May 2021 and 3% from three years ago. Wages are down 5% from last year and up 5% from three years ago. Construction is continuing to thrive with the dollar amount of building permits issued up 809% compared to last year and up 393% from three years ago. YTD is $883,922,360, up 263% from last year. Residential construction starts for May 2022 are up 252% compared to one year ago and up 353% from three years ago. The median house price for May 2022 $248,000 compared to $220,000 one year ago and $199,935 three years ago. Commodities all show higher prices, with oil up % since May 2021 and natural gas up 124%, boosting the rig count to 8 from 4 since last year. For May 2022, wheat is up 59%, corn is up 34% and cotton is up 101% when compared to May 2021. Fat cattle are up 12% for the month when compared to May one year ago. Milk prices are up 48% from last May; higher input costs have cut profitability for dairy producers.
*Base-100, January 1988 This document was prepared by Amarillo National Bank on behalf of itself for distribution in Amarillo, 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.
Inflation Inflation is now on everyone’s mind, with most comments being that it is “too much”. We are cursed with the double whammy of both types of inflation: Cost Push The problems appear compounded because of the inability of fiscal and monetary leaders in Washington to recognize the causes of the problem. We have reported on inflation regularly over the last year; and policy makers have been on a different page. Our inflationary pressures come from: Fiscal Policy A 9% drop in output was juiced by a 27% level of “stimulus”, (which appears to be three times what was needed). Monetary Policy Interest Rates were driven too low and stayed too long. The compound errors in both of these policies have combined to cause the current level of “too much” inflation.
Companies Interest costs will more than double. Individuals Much higher risk of a recession. |
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