KINGSVILLE, Texas – Texas Comptroller Glenn Hegar says it will be Texas consumers that lead the state out of recession.
Hegar spoke about the state of the Texas economy while giving the keynote address at Texas A&M University-Kingsville’s virtual 2020 Economic Forum.
He pointed out that while other states have just one economic headwind to contend with, the effects of the coronavirus pandemic, Texas has two, the pandemic and a contraction in the oil and gas industry, which had started before COVID-19 hit.
“Many other states don’t have the double headwinds that Texas has faced with the contraction in oil and gas as well,” Hegar said.
“We think Texas will have a slower time getting back to pre-pandemic levels for GDP growth as well as employment numbers – because we have two headwinds, where other states are predominately facing one headwind instead. However, we do think that here in the next eight months or more, Texas will once again start outpacing the national average.”
Hegar said Texas’ negative balance has improved quite a bit.
“While our revenues are negative compared to the same month a year ago, for the last eight months on average, they are not as negative as we anticipated.”
Hegar said state lawmakers will have the buffer of a $9 billion-plus rainy day fund, or savings account, going into the 87th legislative session.
“I think the legislature is going to have a very difficult session from a budgeting standpoint but it is not quite to the level of what we had back in the 2011 session, which was an extremely large gap that we had to close. This one, it will be more difficult, but I think it will be more manageable,” Hegar said.
Hegar added: “The Texas economy is continuing to grow but obviously it is going to take us until 2021 to reach pre-pandemic levels. Which industry will lead us out, we firmly believe it will be you and I, the consumer.”
Here is the presentation Comptroller Hegar made at the TAMUK 2020 Economic Forum:
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