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Glenn Hegar
Texas Comptroller of Public Accounts
Glenn Hegar
Texas Comptroller of Public Accounts
Glenn Hegar
Texas Comptroller of Public Accounts

economy

The Southeast Region2018 Regional Report

Southeast Region Snapshot

Download Printable Snapshot (PDF)

The 15-county Southeast Region covers about 12,800 square miles in easternmost Texas, stretching from the Gulf of Mexico to Nacogdoches along the Louisiana border. The region has a population density of 65 people per square mile, less populated than the state average of 108 people per square mile.

The Southeast Region contains one metropolitan statistical area (MSA): the Beaumont-Port Arthur MSA. It comprises Hardin, Jefferson, Newton and Orange counties and has a population of approximately 412,000. Counties in the region not associated with an MSA are Angelina, Houston, Jasper, Nacogdoches, Polk, Sabine, San Augustine, San Jacinto, Shelby, Trinity and Tyler. The economic center or focus area for the Southeast Region is the city of Beaumont (Jefferson County).

This report examines regional economic trends including population, personal income, jobs and wages, and education, as well as economic conditions unique to the Southeast Region.

Population

The Southeast Region’s estimated total population in 2017 was about 782,000, or nearly 3 percent of the state’s total population. This is an increase of 2 percent (more than 15,000 people) since the 2010 census. An estimated 33 percent of the region’s population is concentrated in Jefferson County. The Beaumont-Port Arthur MSA accounted for 53 percent of the region’s population and about 1.5 percent of the state’s population.

From 2010 to 2017, the region’s population grew at a slower pace than did the state’s as a whole (Exhibit 1). While the populations of each county in the region saw change during this period, Polk outpaced all others, growing by more than 8 percent.

Exhibit 1: Southeast Region Population by County,
2010 and 2017
County 2010 Census Estimate (as of July 2017) Percent Change
Angelina 86,771 87,805 1.2%
Hardin 54,635 57,139 4.6%
Houston 23,732 23,021 -3.0%
Jasper 35,710 35,561 -0.4%
Jefferson 252,273 256,299 1.6%
Nacogdoches 64,524 65,580 1.6%
Newton 14,445 13,952 -3.4%
Orange 81,837 85,047 3.9%
Polk 45,413 49,162 8.3%
Sabine 10,834 10,461 -3.4%
San Augustine 8,865 8,253 -6.9%
San Jacinto 26,384 28,270 7.1%
Shelby 25,448 25,513 0.3%
Trinity 14,585 14,667 0.6%
Tyler 21,766 21,539 -1.0%
Southeast Region Total 767,222 782,269 2.0%
Beaumont-Port Arthur MSA 403,190 412,437 2.3%
Texas Total 25,145,561 28,304,596 12.6%

Source: U.S. Census Bureau


Population Composition

According to a recent Census analysis, the median age for the Southeast Region’s counties is significantly older than the state as a whole. Fourteen of the region’s 15 counties had a median age significantly higher than the state’s median age of 34.2 years. Sabine has the oldest average population in the region, and one of the oldest in the state, with a median age of about 50.6 years. On the other hand, Nacogdoches County not only has the youngest population in the region, but at 30.4 years it is actually significantly younger than the state’s median age. The Beaumont-Port Arthur MSA had a median age significantly higher than the state.

Household income in Texas is more or less evenly distributed among five income levels. Of the more than 9 million households in the state, 22 percent have incomes less than $25,000 on average, and 16 percent have incomes greater than $125,000. In every region of the state, nearly 18 percent of households have an average income between $50,000 and $75,000. Household income in the region was significantly lower than the state; only 27.3 percent of the region’s households had income greater than $75,000 versus 36.3 percent for the state (Exhibit 2).

Approximately 14.4 percent of the Southeast Region’s total population is Hispanic – more than 24 percentage points lower than Hispanics’ 38.6 percent share of the state population (Exhibit 3). This region also has a large black (not Hispanic) population of nearly 20 percent, compared to 11.6 percent of the state population.

Exhibit 2: Southeast Region and Texas Household Income

Exhibit 2: Household Income Percentile, Southeast Region vs. Texas
Income Level Southeast Region State Total
less than $25,000 29.9% 22.2%
$25,000 to $50,000 25.4% 23.6%
$50,000 to $75,000 17.5% 17.8%
$75,000 to $125,000 17.4% 20.2%
more than $125,000 9.9% 16.1%

Source: U.S. Census Bureau

Exhibit 3: Southeast Region and Texas Population by Race and Ethnicity

Population by Race and Ethnicity, Southeast Region vs. Texas
Race and Ethnicity Southeast Region State Total
Hispanic 14.4% 38.6%
Black (not Hispanic) 19.7% 11.6%
White (not Hispanic) 62.4% 43.4%
Other 3.6% 6.3%

Source: U.S. Census Bureau


Jobs and Wages

In 2017, the Southeast Region accounted for more than 2 percent of the state’s total jobs. The region’s employment rate dropped by about 2.3 percent from 2007 to 2017; employment in the Beaumont-Port Arthur MSA fell by a similar amount (Exhibit 4). Approximately 60 percent of the region’s total jobs are in the Beaumont-Port Arthur MSA.

Exhibit 4: Southeast Region Employment, 2007 to 2017
Area Number of Jobs, 2017 Change in Jobs from 2007 Percent Change
Beaumont-Port Arthur MSA 157,895 -3,841 -2.4%
Southeast Region 264,033 -6,083 -2.3%
Texas 12,011,078 1,779,177 17.4%
United States 143,860,846 8,495,037 6.3%

Note: The above figures include private and public sector employees with the exception of active duty military personnel, railroad employees, religious institution employees and the self-employed.

Sources: JobsEQ and Bureau of Labor Statistics


The average wage in the Southeast Region in 2017 was $48,139, well below the state and national averages. However, from 2007 to 2017, individual wage growth in the region outpaced state and national rates during the same period (Exhibit 5).

Adjusted for inflation, individual wages in the Southeast Region increased more than 10 percent during this period. The average wage and the wage growth rate in the Beaumont-Port Arthur MSA was higher than the region as a whole from 2007 to 2017.

Exhibit 5: Southeast Region Wage Trends, 2007 to 2017
Area Average Wage, 2017 Change in Wages from 2007 Nominal Rate of Change, 2007 to 2017 Real Rate of Change,* 2007 to 2017
Beaumont-Port Arthur MSA $54,572 $14,034 34.6% 13.9%
Southeast Region $48,139 $11,344 30.8% 10.7%
Texas $55,801 $11,106 24.9% 5.6%
United States $55,375 $10,917 24.6% 5.4%

* The constant or “real” rate adjusts average wages for the effects of inflation in the value of a particular base year. According to the Bureau of Labor Statistics, prices in 2017 are 18.22 percent higher than prices in 2007.

Sources: JobsEQ and Bureau of Labor Statistics


Industry Concentration

Exhibit 6 lists the Southeast Region industry subsectors that are most highly concentrated according to location quotient (LQ) — a measure of how concentrated an industry is in a region relative to the nation — and by their share of the state’s total jobs in each subsector. Industries are described according to the federal government’s North American Industry Classification System (NAICS), which is used by federal statistical agencies to classify business establishments.

The Southeast Region’s most highly concentrated industries primarily are production of chemical and petroleum products as well as construction. The region’s most highly concentrated industry subsector – petroleum and coal products manufacturing – also is growing steadily. Employment in this subsector increased by 15 percent in 2007-2017, and wages grew 12 percent during the same period.

Exhibit 6: Southeast Region’s Most Highly Concentrated Industries, 2007 to 2017
Industry Description (NAICS1) Job Concentration Job Trends Wage Trends
Location Quotient2 Share of State's Jobs Number of Jobs Change, 2007 to 2017 Average Wage Nominal Rate3 of Change Real Rate3 of Change, 2007 to 2017
Petroleum and Coal Products Manufacturing (324) 24.02 22.0% 5,100 15.0% $137,452 32.4% 12.0%
Forestry and Logging (113) 8.35 55.8% 903 -23.3% $45,649 12.0% -5.2%
Pipeline Transportation (486) 7.60 3.8% 719 48.6% $112,787 39.4% 17.9%
Chemical Manufacturing (325) 4.71 9.1% 7,265 18.7% $132,239 48.3% 25.5%
Wood Product Manufacturing (321) 4.69 14.6% 3,506 -33.7% $47,618 0.1% -15.4%
Heavy and Civil Engineering Construction (237) 3.27 4.0% 7,107 48.4% $69,062 48.5% 25.6%
Construction of Buildings (236) 2.63 4.8% 7,645 1.4% $75,314 58.0% 33.7%
Support Activities for Mining (213) 2.53 1.1% 1,401 -9.7% $76,766 64.6% 39.2%
Justice, Public Order and Safety Activities (922) 2.35 3.7% 8,342 -5.4% $53,879 30.3% 10.2%
Paper Manufacturing (322) 1.81 7.1% 1,246 -19.7% $110,391 39.0% 17.6%
Southeast Region - 9.3% 264,033 -2.3% $48,139 30.8% 10.7%

Note: The figures above include private and public sector employees with the exception of active duty military personnel, railroad employees, religious institution employees and the self-employed.

  1. NAICS codes are the standard used by federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing and publishing statistical data related to the U.S. business economy.
  2. The higher the location quotient, the more concentrated the industry subsector is in the region compared to nation.
  3. The constant or “real” rate adjusts average wages for the effects of inflation in the value of a particular base year. According to the Bureau of Labor Statistics, prices in 2017 were 18.22 percent higher than prices in 2007.

Sources: JobsEQ and Bureau of Labor Statistics


Education

A strong educational foundation is the cornerstone for growth and competitiveness in the global economy. As the Texas economy diversifies, becoming more knowledge based, a well-educated workforce offers possibilities for workplace advancement and prospects for business expansion.

In 2016, 90.4 percent of the Southeast Region’s class of public high school students graduated, slightly higher than the state rate of 89.1 percent (Exhibit 7). The region’s high school graduation rate has increased about 2 percent since 2010 but has gone from outperforming to being on par with the state.

Many high school graduates enroll in postsecondary programs, offering greater job prospects and the possibility of earning higher wages. Residents of the Southeast Region enjoy a variety of options for higher educational achievement (Exhibit 8).

Exhibit 7: Southeast Region and Texas Public High School Graduation Rates, 2010 to 2016
Year Southeast Texas
2010 88.5% 84.3%
2011 89.3% 85.9%
2012 91.1% 87.7%
2013 91.1% 88.0%
2014 90.0% 88.3%
2015 90.7% 89.0%
2016 90.4% 89.1%

Source: Texas Education Agency


Exhibit 8: Southeast Region Institutions of Higher Education, 2017

Universities

  • Lamar University
  • Stephen F. Austin State University

Junior and Community Colleges

  • Angelina College
  • Lamar Institute of Technology
  • Lamar State College-Orange
  • Lamar State College-Port Arthur

Source: Texas Higher Education Coordinating Board

Regional Economy

The Comptroller's office has analyzed data pertaining to the Southeast Region, examining the region’s dynamics and competitiveness.

Sales Tax Revenue

Sales receipts subject to state sales tax directly attributable to the Southeast Region trended upward in the past decade (trend lines depict trends in data, either upward, downward or flat, for an extended period of time). The region has had a reasonable increase in sales receipts subject to tax following the 2009 recession. While receipts have leveled off since 2014, receipts from 2017 indicate that upward trajectory may have resumed (Exhibit 9).

For 2017, receipts subject to state sales tax directly attributed to businesses in the Southeast Region exceeded $7.4 billion, contributing about 1.5 percent to the state’s overall sales tax revenue collected. The Beaumont-Port Arthur MSA directly accounted for $4.6 billion of this total.

A review of two-digit NAICS codes allows for a broad analysis of industry sectors within the region. The retail trade and the food services and accommodation sectors contributed most to taxable sales, combining for more than 75 percent of the region’s state sales tax collections. Two other industries of note are the wholesale trade and the manufacturing sectors, combining for 11 percent of the region’s reported sales tax collections.

Exhibit 9: Revenue Subject to Sales Tax, 2007 to 2017
Year Southeast Region
2007 $6,460,924,971
2008 $7,021,582,817
2009 $6,495,404,231
2010 $6,380,563,564
2011 $6,633,000,036
2012 $6,880,663,472
2013 $7,081,774,651
2014 $7,309,071,262
2015 $7,300,392,403
2016 $7,199,656,596
2017 $7,426,568,464

Note: Numbers shown are for reported revenue subject to sales tax and directly attributed to the region.

Source: Texas Comptroller of Public Accounts


U.S. Military Installation Impact

Texas has 13 U.S. military installations within its borders. In 2017, these bases directly employed more than 224,000 and supported nearly 625,000 jobs. The U.S. military installations in Texas contributed about $62.3 billion to the state’s gross domestic product (GDP).

While there are no bases located within the Southeast Region, it has been determined that bases in the state have a direct, positive, economic impact through transport, supply and/or logistics.


Southeast Region vs. the U.S.

Based on data from the World Bank and the U.S. Bureau of Economic Analysis, if Texas were a nation, it would rank as the world’s 10th largest economy in terms of GDP. Exhibit 10 shows how the region ranks with other states and the nation on a number of demographic and economic measures. Were it a state, the Southeast Region would be the 42nd largest in terms of land mass (square miles) and have the 47th largest population.

Exhibit 10: Southeast Region Compared to the U.S.
Measure Southeast Region Rank if Region
was a State
Texas State Rank U.S.
Population 782,269 47 28,304,596 2 325,719,178
Population age 25+ with at least a high school diploma 83.4% 48 82.4% 49 87.0%
Population age 25+ with bachelor’s degree or higher 16.2% 51 28.1% 29 30.3%
Population under 18 years 23.6% 13 26.0% 2 22.6%
Population 65 years and over 16.6% 20 12.3% 48 15.7%
Age dependency ratio* 67.2% 46 62.1% 20 61.9%
Per capita income $38,861 48 $46,204 25 $49,204
Unemployment Rate 6.3% 50 4.3% 26 4.4%

* The age dependency ratio is the share of dependent-age persons compared to the working-age population minus the sum of those under 18 years and 65 and older divided by the population age 18 to 64. In other words, for every 100 working-age people in Texas there are about 62 dependent-age people.

Sources: U.S. Census Bureau, U.S. Bureau of Labor Statistics, U.S. Bureau of Economic Analysis


Conclusion

The Southeast Region and its 15 counties have unique economic variables and challenges. The region has seen limited population growth since 2010, and residents of 14 of its 15 counties are significantly older than the state’s median age. However, Nacogdoches County has a significantly younger population than the state.

While the Southeast Region took longer than most regions in Texas to recover from the 2009 recession, receipts subject to state sales tax have shown an upward trend over the last few years; with receipts from 2017 indicating continued growth. While the region has had slower employment growth than the rest of the state, the average wage increase was double the state average between 2007 and 2017. Anchored by Beaumont and featuring the Sabine-Neches Waterway, Jefferson County is the region’s economic center. The most concentrated industries in the region involve chemical and petroleum products production and construction services, which add to the vibrancy of the Southeast Region’s economy.


Questions?

If you have any questions or concerns regarding the material on this page, please contact the Comptroller’s Data Analysis and Transparency Division.

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