In a fresh Dallas Federal Reserve survey released on October 28, 2026, over one‑third of Texas business leaders reported higher borrowing costs over the past twelve months. The rise in credit costs is prompting firms to lean on internal cash, delay expansion plans and, in some cases, hold back on hiring.
Survey results show credit‑cost pressure
Of the 283 manufacturing and service executives who responded, 35.3% said their credit costs increased, 18% saw no change, 0.4% reported a decrease, and 46.3% indicated the question did not apply to them.
Among the 71 service‑sector respondents who experienced higher costs, 56.3% have already turned more heavily to internal funds, 38% have reduced or delayed capital spending or expansion, 28.2% have raised prices, and 25.4% have postponed hiring.
Financing challenges remain steady
Overall, 15% of all respondents said they faced at least some difficulty obtaining short‑term credit, while 16% reported trouble securing long‑term credit. Those shares were unchanged from the previous year.
When asked about recent financing attempts, 56.8% of 220 service‑sector respondents said they had not sought short‑term financing, and 57.3% had not pursued long‑term financing. In each category, 14.1% reported at least some difficulty obtaining the needed funds.
Economic activity shows mixed signals
Despite the financing strain, the Dallas Fed noted that Texas service‑sector activity resumed growth in October after a pause in September. The revenue index rose from –0.9 to 4.4, while the input‑prices index stayed elevated at 41.7, well above its long‑term average of 28.0.
These indexes measure the balance of companies reporting increases versus decreases, not the magnitude of the changes. The data suggest that while businesses are still generating revenue, many are choosing to defer equipment purchases, new locations or additional hires.
Manufacturing mirrors service‑sector trends
Among 25 manufacturing respondents who answered the higher‑credit‑cost follow‑up, 44% reported reduced or delayed capital spending or expansion, and 33.3% said they had reduced or delayed hiring. The relatively small sample size limits how broadly these findings can be applied.
Implications for Texas workers and consumers
The survey paints a picture of a Texas economy that is both resilient and constrained. While revenue growth signals a healthy market, the reluctance to invest in new projects or add staff could temper job creation and keep price pressures elevated.
Business owners and consumers alike should weigh the benefits of current growth against the lingering financial constraints that may shape hiring decisions and price trends in the months ahead.
Original reporting: WBAP News/Talk (Dallas-Fort Worth) — read the source article.
