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Unemployment rates in metro Houston, Texas, and the nation rose in January, according to data released by the Texas Workforce Commission. As is typical for the new year, these January figures were released with a significant lag, and February data will be published later in April. Houston’s rate increased from 4.3 percent to 4.9 percent over the month, while Texas rose from 3.9 percent to 4.5 percent, and the U.S. from 4.1 percent to 4.7 percent. The increase reflects a normal seasonal pattern rather than a clear sign of economic softening. Unemployment almost always rises at the start of the year as temporary holiday workers are let go and the fall school semester comes to an end.

Houston’s comparatively higher unemployment rate partly reflects its younger population, which generates more first-time job seekers than the nation as a whole.

Unemployment rates in all three geographies were higher than a year earlier, with Houston’s rate rising by 0.4 percentage points and the state and national rates each increasing by 0.3 points. While these moves bear monitoring, they are not especially large by historical standards.

Local unemployment rates ranged from 4.2 to 8.4 percent among the 16 Houston-area cities where data is reported. Conroe, Friendswood, Galveston, Houston, League City, Pearland, Rosenberg, and Sugar Land had lower unemployment rates than the metro area average. Alvin, Baytown, Deer Park, La Porte, Lake Jackson, Missouri City, Pasadena, and Texas City had higher unemployment rates.

Initial unemployment claims have edged up modestly since the start of the year, with the four-week moving average rising from 3,786 in the first week of January to 4,078 by the end of March. Even so, claims remain well below the late-November spike, when the average climbed to 4,873. On a year-over-year basis, claims were about 9 percent lower than late March ’25, suggesting that recent upticks have been relatively limited and do not point to broader labor market deterioration.

Prepared by Greater Houston Partnership Research Division.

Colin Baker
Manager of Economic Research
Greater Houston Partnership
[email protected]

Clara Richardson
Research Analyst
Greater Houston Partnership
[email protected]