The Odessa Economic Index, which added 1.3 points from February to March, expanded by an even bigger margin in April adding 1.8 points for the month increasing to 192.8 up from 191.0 in March, but still down 3.5% from the April 2016 OEI of 199.7 (again, though, that gap is rapidly closing). General taxable spending was up sharply in April, though real auto spending was unexpectedly significantly lower compared to April of a year ago. Hotel/motel activity in the first quarter finally began to exhibit significant year-over-year growth, and payroll employment finally appears to have closed the gap in April with the estimated number of jobs the same as in April 2016.
The Texas Permian Basin Petroleum Index logged its seventh straight monthly increase in April, improving to 240.8 for the month up from 234.9 in March, and up over 11% from the April 2016 index of 216.4. Crude oil and natural gas prices remain sharply higher compared to year-ago levels, along with the number of drilling permits issued and the value of regional oil & gas production. The rig count total (for RRC districts 7C, 8, and 8A) is now well more than double its year-ago level, and direct oil and gas employment just in the metro area alone has grown by over 1,500 jobs compared to its third quarter 2016 low point. The volume of crude oil and natural gas production was scarcely slowed by the contraction, and in fact, the rate of growth cooled a bit but production never actually experienced a measurable decline. And now production is on the rise once again with estimated daily crude production in April just in those three Railroad Commission Districts climbing to record levels thus far in 2017, a trend very likely to continue in the coming months.
Real (inflation-adjusted) taxable spending per April sales tax receipts was up by double-digit percentage points for the second straight month at about 23% higher compared to April 2016. Early 2016 spending was down by similar amounts, however; the April 2016 total was off by nearly 25% year-over-year, and in fact general real spending for the entire year was down by nearly 20%. Still, April 2017 spending was the second-highest on record for the month of April, down only compared to the April 2015 real spending total in advance of the deep declines that began to occur in the latter half of 2015. Spending for the year-to-date through April is up by 7.7% compared to the January-April 2016 total, which in turn was down by 23% compared to the first four months of the prior year. For the 12 months ending April 2017 general real spending was down by 5.6% compared to the previous 12 months.
The employment situation is on the mend in Odessa, though employment recovery is in the early stages. The year-over-year deficits have been erased at this point with the April payroll employment estimate coming in at 69,600, the same as in April 2016. At this point, about 1,000 jobs have been added back since the low point in September 2016, at which time an estimated 12,200 jobs had been lost throughout the Odessa economy. The unemployment rate is once again on the decline, dipping to 4.9% in April down from 6.5% in April of last year.
Oddly, auto sales activity reversed course in April with inflation-adjusted spending on new and used automobiles down by over 18% year-over-year. Real auto spending remains positive for the year-to-date, however, up by 5.3% compared to the first four months of 2016.
The April 2015 real building permit total was the lowest for the month of April since 2010; the decline compared to April 2016 was modest at only 1.4%; however, the permit total from April of last year was down by about 50% year-over-year. Through April, real permit valuations are down just slightly compared to the first four months of 2016.
The number of new single-family housing construction permits posted its first year-over-year decline in six months, off by about 23% (eight fewer permits) compared to April of a year ago. The year-to-date total remains sharply higher, however, up by 35% year-over-year, and in fact the 182 permits issued through April is the highest for the first four months of the year since 2013.
Home sales activity declined in April for the first time in seven months with the number of closed sales down by about 22% compared to April of a year ago. The year-to-date total remains about 6% improved over year-ago levels, however. Prices were lower for the month as well with the April monthly average down by close to 10% compared to April 2016. The inflation-adjusted total dollar volume of residential real estate sales activity was down by a sharp 30% compared to April of a year ago, but remains slightly positive for the year-to-date.
