Despite mounting fear of an economic recession, Texas Governor Rick Perry is confident in the state’s economy. So confident that he, in fact, ordered business tax cuts for over 370,000 area employers. These tax cuts will come from a one-year suspension of the tax that replenishes the state’s unemployment fund.

This news comes at a time when the Texas jobless rate has increased for the second month in a row. Nevertheless, the state reached a 31-year low of 4.1 percent at times last year and continues to remain below the national unemployment rate of 4.8 percent.

Although the unemployment rate rose over the last two months, Texas job creation continued. This makes it apparent that part of the rise in the percent of the population unable to find work could be a result of new residents recently attracted to the area. In 2007, Texas created more jobs that any other state in the nation.

According to the Texas Workforce Commission, which approved the tax cut, there is already enough money in the fund to handle unemployment payments for the rest of the year. Overall, these tax cuts will save area employers approximately $90 million, which will hopefully be put towards expansion and the creation of new Texas jobs. As a result, the area economy could actually benefit from less money in the city’s coffers.

When asked to comment on the tax cuts Governor Perry said “I believe in truth-in-budgeting: when government levies a tax and collects more money than is needed, we must either stop collecting the tax, return the money or both.”

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