Dallas–Fort Worth employment growth is accelerating in 2026, rebounding from an unusually weak 2025 driven by heightened policy uncertainty, higher tariffs, and sharply lower immigration. The Dallas Federal Reserve’s latest indicators show the metro area gaining momentum alongside the broader Texas labor market, which added jobs at a 1.7% pace in the first quarter.
Professional and business services have powered much of the DFW-area recovery, with staffing services employment accounting for one-third of all job gains across the state. The rebound in temporary staffing follows several years of contraction that partially reflected a readjustment from pandemic-era highs, when employers shifted toward permanent hires during a tight labor market. Economists at the Dallas Fed note that while the outsized share of temporary staffing could signal employer caution about making permanent commitments amid economic uncertainty, it also reflects genuine growth in labor demand.
DFW’s unemployment rate has remained low and closely tracks the U.S. rate of 4.3%. Broader measures of labor market health have improved: the U6 rate, which includes discouraged workers and part-time workers seeking full-time employment, declined from 8.5% to 7.9% during the first quarter across Texas, suggesting improvements beyond the headline unemployment rate.
Manufacturing activity has surged across the state, driven by pent-up demand, onshoring of production, and investments in artificial intelligence infrastructure — trends particularly relevant to the DFW region, which has attracted significant corporate relocations and expansions in advanced manufacturing and technology. The Dallas Fed’s business outlook surveys show headline indicators remaining positive even as geopolitical headwinds from the Iran conflict weigh on sentiment.
One area of concern is the declining labor force participation rate, which has ticked down to 64.4% in Texas — a trend since September 2025. While a half-percentage point decline over six months is not yet alarming, the Dallas Fed cautions that if the trajectory persists, it could signal deeper labor-market concerns, whether from discouraged workers, an aging workforce, or declining response rates among immigrant populations whose participation tends to exceed the national average.
