the lone star state in 2013 : bis central bankers ’ speeches in terms of number of jobs created, the leading sectors in texas last year were trade, transportation and utilities ( accounting for 73, 700 ), professional and business services ( 44, 600 ), leisure and hospitality ( 42, 300 ), educational and health services ( 33, 500 ), construction ( 26, 800 ), government ( 19, 700 ) and financial activities ( 18, 100 ). this year through july, texas employment has already increased by 238, 200 jobs, a 3. 6 percent annualized growth pace. over the 12 months ending this july, texas added just shy of 400, 000 jobs – more jobs than any other state. clearly, texas employment is growing at an impressive clip. another misperception is that all of these jobs created in texas are low - paying jobs. wrong. we have been creating jobs in every income quartile, unlike the rest of the country. this graph, recently updated, covers the 13 - year period from 2000 to 2013. it charts job creation by wage quartile in texas and in the nation ex - texas. as you can see, texas has had healthy growth in every income quartile, while, without texas, the united states has actually seen job destruction, on net, in the two middle - income quartiles. ( this fact deeply concerns me because middle - income groups are the backbone of america. ) bis central bankers ’ speeches u. s. economy is on the mend the reality, mr. ambassador, is that texas is part of the united states and, all told, our economy is on the mend from the frightful shock of the financial and economic implosion of 2007 – 09. this is the dashboard that we at the dallas fed use to track our national economy : bis central bankers ’ speeches the federal reserve is mandated by the laws of the united states to manage monetary policy to achieve full employment while maintaining price stability and “ moderate interest rates ” over time. 1 a “ hindu goddess ” as you can see from this graphic, unemployment has declined to 6. 2 percent, and the dynamics of the labor market are improving. at the federal open market committee, where we set monetary policy for the nation, we have been working to better understand these employment dynamics. this is no easy task. bill gross, one of our country ’ s preeminent bond managers, made a rather pungent comment about our efforts.

hire new workers or build a new plant until i have been shown what will come out of this agreement. ” bis central bankers ’ speeches moreover, you might now say to yourself, “ i understand from the federal reserve that i don ’ t have to worry about the cost of borrowing for another two years. given that i don ’ t know how i am going to be hit by whatever new initiatives the congress will come up with, but i do know that credit will remain cheap through the next election, what incentive do i have to invest and expand now? why shouldn ’ t i wait until the sky is clear? ” based on past behavior of fiscal policy makers, businesses understandably regard the debt ceiling agreement and the political outcome of negotiations between congress and the president with the suspicion akin to how the british humorist p. g. wodehouse regarded his aunts : “ it is no use telling me there are bad aunts and good aunts, ” he wrote. “ at the core they are all alike. sooner or later, out pops the cloven hoof. ” 2 it will be devilishly difficult for businesses to commit to adding significantly to their head count or to meaningful capital expansion in the united states until clarity is achieved on the particulars of how congress will bend the curve of deficit and debt expansion and the “ cloven hooves ” are revealed. no amount of monetary accommodation can substitute for that needed clarity. in fact, it can only make it worse if business comes to suspect that the central bank is laying the groundwork for eventually inflating our way out of our fiscal predicament rather than staying above the political fray – thus creating another tranche of uncertainty. in the interest of full disclosure, i should add that i was also concerned that just by tweaking the language the way the committee did, our action might be interpreted as encouraging the view that there is an fomc so - called “ bernanke put ” that would be too easily activated in response to a reversal in the financial markets. for those of you unfamiliar with the expression “ bernanke put, ” or more generally, a “ central bank put, ” this term refers to the concept that a central bank will allow the stock market to rise significantly without tightening monetary policy, but will ease monetary policy whenever there is a stock market “ correction. ” given the extent of the drop in the stock market leading up to and following standard & poor ’ s downgrade of u. s.