As the saying goes, “everything’s bigger in Texas.” The Lone Star state is the largest state in the contiguous U.S., covering 7.4% of total land area in the country. Texas is a big state with a big population, currently estimated at 16 million. It is also home to the highest volume of petroleum production in the country. More than 85% of counties in Texas contain natural gas reserves, and the oil and gas industry represents a large portion of the state’s economy. However, Texas is also a national leader in the percentage of workers employed in minimum wage jobs and has one of the highest poverty rates in the country.
The state closed out last year with an unemployment rate of 4.7%, which was lower than the national average of 5.0%. Texas, like the rest of the country, experienced a dramatic increase in unemployment during the Great Recession. The Texas unemployment rate reached its highest point in 2009 at 8.4%. This was lower than the national unemployment rate at the time, which peaked at 10.0% that same year. The high unemployment rates of the Great Recession led to most states borrowing Federal funds to support their unemployment programs. Texas does not currently have any outstanding Federal debt, and the state trust fund has a positive balance. However, it is likely not funded well enough at this point to withstand another recession (based on the latest AHCM of 0.39).
The taxable wage base in Texas is $9,000, and the current average tax rate for employer state-wide is 2.58% (as a percentage of taxable wages). The minimum and maximum employer tax rates are 0.47% and 7.49% respectively. The maximum duration of unemployment payments in Texas is currently 26 weeks, in line with the national average. The maximum weekly benefit amount that can be paid on an unemployment claim is $465, which translates to a maximum total claim value of $12,090. However, the current average claim payout for the state of Texas is $3,921 as most claimants do not qualify for or collect the maximum possible benefit amount.