Amarillo Economic Forecast for 2025
2024 Recap
Moderately strong economy across most sectors for Amarillo, although businesses struggled with the effects of the late stage of inflation. Cattle and dairy boosted our ag sector; while construction was better than expected.
Areas of Economic Strength
- Retail sales were up at about the rate of inflation
- Job growth was moderate, but steady; led by warehouses and Pantex
- Jump in airline boardings
- Cattle and dairy had good results
- Commercial construction was strong
- Savers had more disposable income
Areas of Economic Weakness
- Insurance and interest costs hurt all businesses and customers
- Car and truck sales slowed and used prices dropped
- Housing starts dropped due to higher mortgage rates
- Tourism down slightly from Covid peaks
- Rainfall came at wrong times
- Small businesses had a tough year
- Energy was flat and not a big boost
2025 Forecast
As optimism returns to our economy, most sectors should do well. Job growth will come from defense contractors and improving small businesses. Insurance and interest costs will continue to put pressure on businesses and consumers, but flatten out at the higher levels.
Outlook for Specific Sectors
Employment
Job growth was steady, with a boost from Pantex offsetting some drops at national companies and small businesses. 2025 should have stronger results in the 2nd half, with a boost from defense contractors.
| 12 Month Average | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Household Survey | 129,667 | 129,339 | 122,155 | 127,228 | 130,509 | 133,106 | 135,090 | 137,000 |
| Employers Survey | 121,950 | 121,184 | 116,353 | 120,714 | 124,350 | 127,525 | 129,195 | 131,000 |
| Average Unemployment | 2.70% | 2.50% | 4.80% | 4.13% | 2.93% | 3.13% | 3.08% | 3.30% |
Retail Sales
Sales have fluctuated throughout 2024, as lower income consumers were stressed. Higher insurance, taxes and grocery costs cut disposable spending. 2025 should see improvements during the last half of the year, as prices flatten out. Vehicle and equipment sales should benefit from lower prices, as dealers try to move excess inventory.
| Sales Tax Collections | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Amount | $77,261,171 | $78,934,689 | $81,094,099 | $91,925,630 | $99,980,813 | $100,432,055 | $104,078,244 | $107,500,000 |
| % Change | 4.16% | 2.17% | 2.74% | 13.35% | 8.77% | 0.45% | 3.50% | 3.18% |
Consumer Price Index
CPI is down and has gotten harder to estimate due to businesses changing items to compare. Food is up 2.4%, while energy is down 3%. The CPI for lower income families is estimated to be up 6.5%.
| CPI Increases | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Amarillo | 2.90% | 2.00% | -1.23% | 6.29% | 9-11% | 4.60% | 2.50% | 2.40% |
| National | 2.20% | 2.10% | 0.20% | 6.80% | 8.50% | 4.39% | 2.70% | 2.60% |
Real Estate
Commercial construction kept permits up, as higher interest rates stalled residential starts and existing home sales. Job growth will help single family, but commercial totals will be down.
| Building Permits | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Housing Starts | 505 | 520 | 666 | 746 | 971 | 923 | 502 | 470 |
| Remodels & Roofing | 3,176 | 5,057 | 4,512 | 4,114 | 1,356 | 5,869 | 6,380 | 4,000 |
| Commercial Units | 415 | 418 | 267 | 381 | 690 | 874 | 844 | 800 |
| Total Value (mil) | $472 | $332 | $494 | $961 | $530 | $392 | $456 | $420 |
| Median House Value (000) | $155 | $180 | $200 | $220 | $235 | $240 | $250 | $248 |
Agri-Business
Cattle had another fine year, and we should have one more good year in this late stage of the cycle. Dairy turned profitable in the mid-year and made up for earlier losses. Row crops had good yields , but cotton was below average. 2025 prices should remain at these relatively low levels.
| ($ Average) | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Wheat | $4.73 | $4.30 | $4.71 | $7.00 | $9.55 | $7.30 | $6.44 | $7.00 |
| Fed Cattle | $116.11 | $115.71 | $109.10 | $121.29 | $143.50 | $174.37 | $185.40 | $188.00 |
| Corn | $3.89 | $4.07 | $3.85 | $5.66 | $6.91 | $5.60 | $4.60 | $5.00 |
| Cotton | $69.65 | $66.76 | $58.56 | $71.41 | $93.51 | $78.51 | $74.21 | $73.00 |
| Milk | $14.28 | $16.25 | $17.57 | $16.76 | $21.79 | $17.58 | $19.08 | $18.50 |
Energy
Our drilling continues at low levels, as the Permian Basin is more economic. As oil prices dropped, natural gas rebounded in the Fall. We expect lower oil, but higher natural gas prices, with limited drilling and some workover work in 2025.
| Yearly Average | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Active Rigs | 22 | 10 | 2 | 5 | 8 | 5 | 3 | 3 |
| Oil (Panhandle) | $64.43 | $58.17 | $39.63 | $68.43 | $94.83 | $77.90 | $76.32 | $70.00 |
| Natural Gas | $2.94 | $2.68 | $2.13 | $3.65 | $6.46 | $2.68 | $2.44 | $2.70 |
Travel
Nine months of growth came to an end in the Fall. Boardings at United up 22%, American down 6% and Southwest down 15%. Boardings in 2025 should hold steady. Less occupancy through last year coupled with lower room rates resulted in less tax. 2025 should see both occupancy and rates improve slightly, as optimism returns.
| Travel | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Airline Boardings | 360,762 | 366,640 | 232,585 | 298,220 | 365,983 | 399,299 | 411,167 | 413,000 |
| +5.26% | +1.63% | -36.56% | +28.00% | +22.70% | +9.10% | +2.80% | +.443 | |
| Motel Tax | 6,962,730 | 7,193,818 | 5,467,228 | 8,717,588 | 9,381,000 | 9,289,524 | 9,099,565 | 9,250,000 |
| +5.31% | +3.32% | -24.00% | +59.45% | +7.61% | +0.975% | +2.09% | + 1.65% |
Bankruptcy Filings
Uptick due to inflation problems should keep 2025 up somewhat.
| Bankruptcy | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Filings | 439 | 417 | 328 | 297 | 240 | 284 | 333 | 360 |
Amarillo Leading Indicators
We do not forecast this, as the formula looks six months ahead. December was slightly negative.
| Amarillo Leading Indicators | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 (est) |
|---|---|---|---|---|---|---|---|---|
| Annual Average | -5.60% | -11.67% | 1.50% | 2.92% | 4.77% | 8.79% | -5.87% | We do not forecast this, as the formula looks six months ahead.December was slightly negative. |