Federal Reserve Bank of Dallas
05/27/2026 | Press release | Distributed by Public on 05/27/2026 08:49
Texas Service Sector Outlook Survey
May 27, 2026
Special questions: Artificial intelligence (AI)
Texas service sector activity expanded at about the same pace in May as the prior month, according to business executives responding to the Texas Service Sector Outlook Survey. The revenue index, a key measure of state service sector conditions, was little changed at 5.0.
Labor market measures suggested a slight decline in employment in May and no change in workweeks. The employment index dipped two points to -3.2. Meanwhile, the hours worked index was near zero for the third consecutive month.
Perceptions of broader business conditions continued to worsen in May. The general business activity index ticked up two points but remained in negative territory at -7.7. The company outlook index was little changed at -5.4. Meanwhile, the outlook uncertainty index fell eleven points to 14.0.
Selling price pressures eased slightly while input prices and wages rose at about the same pace as in April. The selling prices index dipped three points to 5.0. The input prices and wages indexes were both little changed, registering 29.7 and 6.2, respectively.
Respondents' expectations regarding future service sector activity were mixed. The future revenue index ticked down three points but remained in solid positive territory at 28.9. However, the future general business activity index fell five points to a near zero reading. Other future service sector activity indexes, such as employment and capital expenditures, remained in positive territory.
Next release: June 30, 2026
Data were collected May 12-20, and 242 of the 350 Texas service sector business executives surveyed submitted responses. The Dallas Fed conducts the Texas Service Sector Outlook Survey monthly to obtain a timely assessment of the state's service sector activity. Firms are asked whether revenue, employment, prices, general business activity and other indicators increased, decreased or remained unchanged over the previous month.
Survey responses are used to calculate an index for each indicator. Each index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index will be greater than zero, suggesting the indicator has increased over the prior month. If the share of firms reporting a decrease exceeds the share reporting an increase, the index will be below zero, suggesting the indicator has decreased over the prior month. An index will be zero when the number of firms reporting an increase is equal to the number of firms reporting a decrease.
Data have been seasonally adjusted as necessary.
Federal Reserve Bank of Dallas published this content on May 27, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 27, 2026 at 14:49 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]