2015 HOUSTON
ECONOMIC HIGHLIGHTS December 7, 2015
Publication underwritten by:
Contents
2 | Houston in Perspective
32 | Retail Sales
4 | Payroll Employment
34 | New Car, Truck and SUV Sales
6 | Unemployment Rate
36 | Inflation
8 | Goods-Producing and Service-Providing Jobs
38 | Cost of Living Comparison
10 | Employment by Industry
40 | Housing Cost Comparison
12 | Employment Change by Industry
42 | Houston Region Population
14 | Employment Growth in Major Metros
44 | Foreign-Born Population
16 | Purchasing Managers Index
46 | Most Populous Metropolitan Areas
18 | Oil and Natural Gas Prices
47 | Most Populous Cities
20 | Drilling Activity and Oil Prices
48 | Most Populous Counties
22 | Foreign Trade
49 | The Work Ethic in Houston
24 | Air Passengers
50 | Gross Area Product Forecast
26 | Residential Real Estate
52 | Population and Employment Forecast
28 | Office Market
54 | Top Metro Areas by Gross Domestic Product
30 | Hotels
Houston Economic Highlights, a publication of the Greater Houston Partnership, is designed to impart a quick understanding of the changes in Houston’s economy over the past decade. Each page is devoted to a single indicator or a few related indicators. In most cases, a key point and a few bullets that amplify what the data say appear on one page, and a table with historical data follows on the next. December 2015
Partnership Research
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Houston in Perspective People The nine-county Houston MSA had a population of 6,490,180 residents as of July 1, 2014, according to estimates by the U.S. Census Bureau. If metro Houston were a state, it would have the 18th largest population in the U.S., behind Tennessee (6,549,352) and ahead of Missouri (6,063,589) and Maryland (5,976,407). Harris County had a population of 4,441,370 residents as of July 1, 2014, according to estimates by the U.S. Census Bureau. If Harris County were a state, it would have the 26th largest population in the U.S., behind Louisiana (4,649,676) and ahead of Kentucky (4,413,457) and Oklahoma (3,970,239). The city of Houston had a population of 2,239,558 residents as of July 1, 2014, according to estimates by the U.S. Census Bureau. If the city were a state, it would rank 36th in population in the U.S., behind Nevada (2,839,099) and ahead of New Mexico (2,085,572). Among the nation’s metropolitan areas, the Houston MSA in 2014 ranked fourth in number of Hispanics (2,356,245), seventh in number of blacks (1,063,017) and seventh in number of Asians (473,582), according to the Census Bureau’s American Community Survey.
Economy The U.S. Bureau of Economic Analysis estimates the Houston MSA GDP at $525.4 billion in 2014. If Houston were a state, its GDP would rank 9th, after New Jersey ($549.1 billion) and ahead of North Carolina ($483.1 billion). If the MSA were an independent nation, it would rank as the world’s 26th largest economy, behind Belgium ($527.8 billion), but ahead of Norway ($511.6 billion). In 2014, the Houston Association of Realtors® Multiple Listing Service recorded closings on 91,305 properties (includes single-family homes, townhomes, condos, high rises, etc.)–an average of one every 5.8 minutes. In 2014, Houston MSA automobile dealers sold 373,998 new cars, trucks and SUVs–an average of one every 1.4 minutes. In 2014, the Houston Airport System handled 53,194,544 passengers–an average of 6,073 passengers per hour around the clock. In 2014, the City of Houston issued building permits for construction valued at $8.67 billion–an average of $275 per second. In 2014, contracts for the construction of new buildings in the Houston MSA totaled $30.5 billion–an average of $58,029 per minute.
4,441,370
2,239,558
residents in Harris County
residents in the city of Houston
91,305 property closings
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Partnership Research
373,998 new cars, trucks and SUVs sold
December 2015
City of Houston ranks:
4th in number of Hispanics 7th in number of Asians 7th in number of blacks
53,194,544 airport passengers
$8.67 billion in construction building permits
Houston in Perspective Houston has one of the youngest, fastest- growing, and most diverse populations in the nation. •
The nine-county Houston metropolitan statistical area (MSA) covers 9,432 square miles–an area smaller than Maryland but larger than New Jersey.
•
Harris County covers 1,778 square miles–an area nearly half as large as Rhode Island.
•
At 655 square miles, the city limits of Houston could contain the cities of New York, Washington, D.C., Boston, San Francisco, Seattle, Minneapolis and Miami.
Geography for the Data in this Publication •
9-COUNTY HOUSTON MSA
Montgomery Liberty
Austin Waller
Some governmental agencies (e.g., U.S. Bureau of Labor Statistics and Texas Workforce Commission) continue to use the 2009 MSA delineation. In other cases, agencies have adopted the new 2013 MSA delineation for reporting purposes.
•
This publication contains data based on both of these two delineations for the Houston MSA, depending on the source. Where possible, every effort was made to revise data to reflect the nine-county Houston MSA.
Chambers
Fort Bend
Metropolitan statistical areas (MSA) are geographic delineations defined by the Office of Management and Budget (OMB) for use by federal statistical agencies in collecting, tabulating and publishing federal statistics. These geographic delineations change over time, with the most recent change occurring in March 2013.
•
Harris
Galveston
Brazoria
9,432
square miles
6,490,180
residents
$525.4 billion
GDP
2009 MSA Delineation for the Houston region: Houston-Sugar Land-Baytown Metropolitan Statistical Area (MSA) contains 10 counties: Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, San Jacinto, and Waller.
2013 MSA Delineation for the Houston region: Houston-The Woodlands-Sugar Land Metropolitan Statistical Area (MSA) contains nine counties: Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller.
December 2015
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Payroll Employment Houston’s total nonfarm payroll employment reached 3.0 million in Oc tober ’15, the highest point in the region’s histor y. NONFARM PAYROLL EMPLOYMENT Houston MSA 12-month change
Total payroll employment
150
3,000
120
2,900
90
2,800
60
2,700
30
2,600
0
2,500
-30
2,400
12-Month Change (000)
Nonfarm Payroll Employment (000)
3,100
-60
2,300 2,200
-90
2,100
-120 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: Texas Workforce Commission
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•
Rapid job growth in upstream energy during ’06 and ’07 led a broad-based expansion that extended to nearly all industries by August ’08, after which job growth fell sharply in the face of a deepening national recession. The 12-month net change in employment turned negative in February ’09 and returned to positive in July ’10.
•
From ’10 to ’14, Houston added nearly half a million jobs. This period of phenomenal growth provided the momentum needed to sustain the region through the early stages of the energy downturn that began at the end of ’14.
•
As oil prices and rig counts continued to fall through ’15, Houston experienced a net loss of 12,800 jobs from December ’14 to September ’15. The region typically adds an average of 13,200 jobs over this period. It was not until October ’15 that Houston reported year-to-date job growth with 8,000 net new jobs and reached 3.0 million total employment, the highest point in the region’s history.
•
A strong U.S. economy, momentum from the previous economic boom, strong population growth, and the $50 billion in petrochemical plant expansions have helped offset losses in upstream energy and manufacturing.
Partnership Research
December 2015
Payroll Employment Houston-The Woodlands-Sugar Land Metropolitan Statistical Area NONFARM PAYROLL EMPLOYMENT, YEAR-END Nonfarm Payroll Employment
2005
2,438,200
2006
91,100
2007
2,635,900
90,700
2,657,500
-110,600
21,600
2,596,600
49,700
2012
82,900
2013
2,887,900
107,000
2010
2011
2,679,500
2,545,200 2008
2009
2,546,900
Change from Prior Year
2,798,000
118,500
2014
89,900
2,992,600
104,700
2015 - as of October
3,000,600
33,100
Source: Texas Workforce Commission
December 2015
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Unemployment Rate Houston’s unemployment rate has remained below five percent for 14 consecutive months. UNEMPLOYMENT RATE - HOUSTON, TEXAS AND U.S. Percent Civilian Labor Force U.S.
Texas
Houston MSA
11 10 9 8 7 6 5 4 3 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Rates are not seasonally adjusted. Source: Texas Workforce Commission
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•
Houston's October ’15 unemployment rate was 4.8 percent, up from 4.4 percent in October ’14. Texas' unemployment rate was 4.5 percent in October ’15, unchanged from 4.5 percent in October ’14. The U.S. rate was 4.8 percent in October ’15, down from 5.5 percent in October the year prior. October ’15 marked the first month Houston’s rate was equal to the U.S. rate in nine years.
•
The unemployment rate can be misleading in gauging job market conditions. “Discouraged workers,” those who are unemployed but not actively job seeking, are not counted in the labor force and therefore not in captured in the unemployment rate. Many workers who have recently lost their jobs may choose to stay out of the workforce since they feel their prospects are limited. Those who are fortunate enough to have received generous severance packages have even more incentive to sit on the sidelines and wait for conditions to improve before seeking employment again.
•
Although Houston’s unemployment rate has remained relatively low through the energy downturn thus far, labor force participation has declined as more workers become discouraged. The civilian labor force has decreased 1.1 percent from 3.28 million in December ’14 to 3.24 million in October ’15. Over the past 10 years, the region experienced an average increase of 2.6 percent during these months.
Partnership Research
December 2015
Unemployment Rate Unemployment Rate: Houston MSA , Texas and the United States PERCENT OF CIVILIAN LABOR FORCE UNEMPLOYED Annual Averages Houston-The Woodlands-Sugar Land MSA
5.6% 2005
2008
20 1 1
5.4%
U.S.
5.0% 2006
4.9%
4.3% 2007
4.4%
5.1%
4.6%
4.6%
4.8%
7.6%
8.5%
4.9%
2009
7.6%
20 1 0
8.2%
5.8%
9.3%
9.6%
8.3%
6.8%
6.2%
8.1%
20 1 2
8.9% 5.0% 20 1 4
Texas
5.1% 6.2%
6.8%
20 1 3
7.4%
8.1% 20 1 5 12 Months ending in October
6.3%
4.4% 4.4% 5.4%
Source: Texas Workforce Commission
December 2015
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Goods-Producing and Service-Providing Jobs Houston’s ser vice -providing sec tor gained 48,600 jobs from Oc tober ’14 to Oc tober ’15. The goods-producing sec tor lost 15,500 jobs during the same period. GOODS-PRODUCING AND SERVICE-PROVIDING EMPLOYMENT Houston MSA Service-providing
620
Goods-producing
2,500
2,300 540
2,200 2,100
500
2,000 460
420
Service-Providing Jobs (000s)
Goods-Producing Jobs (000s)
2,400 580
1,900
’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
1,800
Source: Texas Workforce Commission
•
•
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The goods-producing industries (mining and logging, construction, and manufacturing) peaked at 583,000 jobs in December ’14 and fell to 565,900 jobs in October ’15. •
Mining and logging, primarily oil and gas extraction and support activities, lost 5,700 jobs, a 4.9 percent decrease. Losses in this sector ripple through the economy and triggers declines in other sectors, particularly durable goods manufacturing, wholesale trade and professional and business services.
•
Construction experienced a gain of 5,800 jobs, a 2.8 percent increase, as the petrochemical plant expansions continue in the eastside of Houston. Unfortunately, many of these jobs are temporary and offer lower wages than those in energy and manufacturing.
•
Manufacturing shed 17,200 jobs, a 6.6 percent decrease. Within the manufacturing sector, fabricated metal products lost 7,100 jobs, a 10.8 percent decrease. Manufacturing of machinery used in mining and construction declined by 1,700 jobs (-4.1 percent), computer and electronic product manufacturing lost 800 jobs (-4.5 percent), and non-durable goods manufacturing fell by 400 jobs (-0.5 percent).
The service-providing industries added 25,100 jobs, a 1.0 percent increase, between December ’14 and October ’15. Losses in industries that are heavily dependent on the energy sector were offset by gains in lagging industries that rely mainly on population growth. •
Trade, transportation, and utilities lost 14,400 jobs (-2.3 percent), financial activities 4,400 jobs (-2.9 percent), and professional, scientific and technical services 3,400 jobs (-1.5 percent).
•
Health care and social assistance gained 13,000 jobs (4.3 percent), accommodation and food services 14,500 (5.6 percent), and government 8,000 (2.1 percent).
Partnership Research
December 2015
Goods-Producing and Service-Providing Jobs Houston Metropolitan Statistical Area (MSA) ANNUAL AVERAGES Goods-producing
2005
453,558
2006
1,919,208
2007
518,042
2,055,825
2,071,225
533,408
2,096,217
468,133
2,086,367
2012
2,134,200
2013
545,967
1,986,592
2010
2011
487,192
485,258 2008
2009
487,825
Service-providing
521,117
2,204,500
2014
2,281,558
568,750
2,356,233
2015 - October 12-month average
569,267
2,409,458 Source: Texas Workforce Commission
December 2015
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Employment by Industry No single industr y or sec tor dominates Houston employment. INDUSTRY SHARE OF HOUSTON MSA EMPLOYMENT
20% Trade, Transportation, and Utilities 16% Professional and Business Services 13% Government 12% Educational and Health Services 10% Leisure and Hospitality 8% Manufacturing 7% Construction 4% Mining and Logging (Energy) 4% Other Services 3% Finance and Insurance 2% Real Estate and Rental and Leasing 1% Information
Source: Texas Workforce Commission, October 2015
10
•
Nonfarm payroll employment in the Houston metro area reached a record 3,000,600 in October ’15, a 1.1 percent increase from the 2,967,500 in October ’14.
•
Service industries account for 2.4 million Houston-area jobs or eight out of ten workers in the region. The largest service industries are trade, transportation, and utilities (20.2 percent of jobs), professional and business services (15.8 percent), and educational and health services (12.5 percent).
•
The goods-producing sector employs more than half a million Houstonians and accounts for nearly one in five of the region’s jobs. Manufacturing is the largest goods-producing industry with 8.0 percent of total jobs, followed by construction (7.2 percent), and energy (3.7 percent).
•
Two-thirds of Houston’s manufacturing jobs involve the production of durable goods, items with a useful life of three years of more. In Houston, this includes items such as oil field equipment, structural steel, and computers.
Partnership Research
December 2015
Employment by Industry
HOUSTON MSA EMPLOYMENT BY INDUSTRY Industry
Jobs
Percent of total
Total Nonfarm
3,000,600
100.0
Total Private
2,608,900
86.9
Goods Producing
565,900
18.9
Service Providing
2,434,700
81.1
109,800
3.7
Oil and Gas Extraction
54,100
1.8
Support Activities for Mining
53,700
1.8
Construction
214,600
7.2
Manufacturing
241,500
8.0
160,700
5.4
80,800
2.7
605,700
20.2
Wholesale Trade
167,900
5.6
Retail Trade
306,600
10.2
Transportation, Warehousing, and Utilities
131,200
4.4
34,000
1.1
144,900
4.8
Finance and Insurance
92,700
3.1
Real Estate and Rental and Leasing
52,200
1.7
472,800
15.9
219,700
7.3
33,100
1.1
220,000
7.3
374,300
12.5
56,300
1.9
318,000
10.6
306,300
10.2
Arts, Entertainment, and Recreation
30,600
1.0
Accommodation and Food Services
275,700
9.2
Other Services
105,000
3.5
Government
391,700
13.1
Mining and Logging
Durable Goods Non-Durable Goods Trade, Transportation, and Utilities
Information Financial Activities
Professional and Business Services Professional, Scientific, and Technical Services Management of Companies and Enterprises Admin and Support and Waste Mgmt Educational and Health Services Educational Services Health Care and Social Assistance Leisure and Hospitality
Source: Texas Workforce Commission, October 2015, not seasonally adjusted
December 2015
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Employment Change by Industry Professional and business ser vices were responsible for a f if th of Houston’s job grow th in the past ten years. SHARE OF METRO HOUSTON JOB GROWTH October '05 - October '15
19.0
Professional/Business Services
18.3
Trade/Transportation/Utilities
18.1
Educational & Health Services 16.3
Leisure and Hospitality 7.8
Government 6.9
Mining and Logging
6.2
Construction 4.8
Manufacturing 2.4
Other Services Financial Activities -0.3
0.7 Information
Source: Texas Workforce Commission
•
12
Four sectors were responsible for over seventy percent of Houston’s employment growth from October ’05 to October ’15. •
The professional and business services sector added 114,200 jobs and was responsible for 19.0 percent of the total growth in jobs over this period. The professional and business services sector grows as demand increases for technical expertise, such as engineering and computer systems design, and businesses require support services, like office administration, facilities support, and employment services.
•
Trade, transportation and utilities gained 109,700 jobs and contributed to 18.3 percent of the gain in employment during this period. The sector benefits from the expanding local consumer market through growth in jobs, wages and population. In the past ten years, Houston added 600,600 jobs, increased average wages (net of inflation) by 12.6 percent, and grew by 1.3 million residents. Transportation also benefits from the $250 billion in annual trade passing through the Houston-Galveston Customs District.
•
Educational and health services grew by 108,500 jobs and accounted for 18.1 percent of Houston’s total employment growth in the past ten years. The sector depends on the region’s population and employment growth, and health services is further spurred by the aging of the population.
•
Leisure and hospitality added 97,700 jobs from October ’05 to October ’15 and contributed to 16.3 percent of total job growth. Houston is home to more than 77,000 hotel rooms and a net of 300 new bars and restaurants open in Houston each year.
Partnership Research
December 2015
Employment Change by Industry Job Grow th: Houston Metropolitan Statistical Area (MSA) HOUSTON MSA EMPLOYMENT BY INDUSTRY Industry
Oct ’05
Oct ’15
Change
% Change
% Share of Job Growth
2,400,000
3,000,600
600,600
25.0
------
68,400
109,800
41,400
60.5
6.9
Construction
177,600
214,600
37,000
20.8
6.2
Manufacturing
212,800
241,500
28,700
13.5
4.8
132,200
160,700
28,500
21.6
4.7
80,600
80,800
200
0.2
0.0
496,000
605,700
109,700
22.1
18.3
Wholesale Trade
130,200
167,900
37,700
29.0
6.3
Retail Trade
248,700
306,600
57,900
23.3
9.6
Transportation, Warehousing and Utilities
117,100
131,200
14,100
12.0
2.3
35,800
34,000
-1,800
-5.0
-0.3
140,900
144,900
4,000
2.8
0.7
Finance and Insurance
92,600
92,700
100
0.1
0.0
Real Estate and Rental and Leasing
48,300
52,200
3,900
8.1
0.6
358,600
472,800
114,200
31.8
19.0
161,900
219,700
57,800
35.7
9.6
16,600
33,100
16,500
99.4
2.7
180,100
220,000
39,900
22.2
6.6
265,800
374,300
108,500
40.8
18.1
42,500
56,300
13,800
32.5
2.3
223,300
318,000
94,700
42.4
15.8
208,600
306,300
97,700
46.8
16.3
Arts, Entertainment, and Recreation
25,800
30,600
4,800
18.6
0.8
Accommodation and Food Services
182,800
275,700
92,900
50.8
15.5
90,600
105,000
14,400
15.9
2.4
344,900
391,700
46,800
13.6
7.8
Total Nonfarm Mining and Logging
Durable Goods Non-Durable Goods Trade, Transportation, and Utilities
Information Financial Activities
Professional and Business Services Professional, Scientific, and Technical Services Management of Companies and Enterprises Admin and Support and Waste Mgmt Educational and Health Services Educational Services Health Care and Social Assistance Leisure and Hospitality
Other Services Government
Source: Texas Workforce Commission
December 2015
Partnership Research
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Employment Growth in Major Metros Houston gained 33,100 net new jobs from Oc tober ’14 to Oc tober ’15, a 1.1 percent increase. EMPLOYMENT GROWTH RATE – PERCENT CHANGE (OCTOBER ’14-OCTOBER ’15) 20 Most Populous Metro Areas 3.5
Atlanta, GA
3.4
San Francisco, CA
3.3
Riverside, CA 3.1
Seattle, WA Dallas, TX
3.0
Tampa, FL
3.0 2.9
San Diego, CA 2.6
Phoenix, AZ
2.5
Baltimore, MD 2.2
Los Angeles, CA Miami, FL
2.1
Washington, DC
2.1 2.0
Detroit, MI
1.9
Boston, MA
1.8
Minneapolis, MN
1.7
New York, NY Houston, TX
1.1
Chicago, IL
1.1
Philadelphia, PA
1.1 1.0
St. Louis, MO
Source: U.S. Bureau of Labor Statistics, not seasonally adjusted
14
•
All 20 of the most populous U.S. metro areas posted net job gains from October ’14 to October ’15. During this period, the New York metro led the nation in total job growth with 157,100 jobs, and the Atlanta metro was first in percent change with a 3.5 percent increase.
•
After leading the nation in employment gains coming out of the Great Recession, Houston experienced a slower pace of job growth from October ’14 to October ’15. Amid an energy downturn, the region added 33,100 jobs net new jobs, a 1.1 percent increase during this period.
•
As Houston diversifies away from energy, the region becomes more dependent on the U.S. economy to support its growth.
Partnership Research
December 2015
Employment Growth in Major Metros Net Change in Nonfarm Payroll Employment EMPLOYMENT CHANGE (OCTOBER ’14-OCTOBER ’15) 20 Most Populous U.S. Metropolitan Statistical Areas
Change in Jobs (000)
Percent Change
New York-Newark-Jersey City, NY-NJ-PA
Los Angeles-Long BeachAnaheim, CA
Dallas-Fort Worth-Arlington, TX
157.1
126.3
98.4
1.7%
2.2%
3.0%
Atlanta-Sandy Springs-Roswell, GA
San Francisco-OaklandHayward, CA
Washington-ArlingtonAlexandria, DC-VA-MD-WV
88.1
74.3
67.1
3.5%
3.4%
2.1%
Seattle-Tacoma-Bellevue, WA
Miami-Fort LauderdaleWest Palm Beach, FL
Chicago-Naperville-Elgin, IL-IN-WI
57.1
52.7
51.7
3.1%
2.1%
1.1%
Boston-CambridgeNewton, MA-NH
Phoenix-Mesa-Scottsdale, AZ
Riverside-San BernardinoOntario, CA
50.8
48.3
43.2
1.9%
2.6%
3.3%
San Diego-Carlsbad, CA
Detroit-Warren-Dearborn, MI
Tampa-St. Petersburg-Clearwater, FL
40.2
38.7
37.1
2.9%
2.0%
3.0%
Minneapolis-St. PaulBloomington, MN-WI
Baltimore-ColumbiaTowson, MD
Houston-The WoodlandsSugar Land, TX
34.2
33.5
33.1
1.8%
Philadelphia-CamdenWilmington, PA-NJ-DE-MD
St. Louis, MO-IL
31.6
13.7
1.1%
2.5%
1.1%
1.0%
Source: U.S. Bureau of Labor Statistics; not seasonally adjusted.
December 2015
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Purchasing Managers Index Houston’s PMI continues to signal a contrac ting economy. PURCHASING MANAGERS INDEX Above 50 Signals Short-Term Growth, Below 50 Signals Short-Term Contraction
70
Expansion
60
50
Contraction
40
30 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: Institute for Supply Management - Houston
16
•
The Houston Purchasing Managers Index (PMI), a short-term leading indicator of regional production, fell below 50 in January ’15 and reached a low of 42.7 in April. Since then, the PMI has inched upwards but has remained below 50 for 10 consecutive months. (Readings below 50 signal likely contraction within the next three to four months.)
•
The index stood at 48.0 in October ’15 and has averaged 47.0 through the first ten months of the year, compared to 57.2 over the same period in ’14.
•
During the Great Recession, Houston’s PMI registered below 50 from November ’08 to August ’09, bottoming out at 39.0 in March ’09. A V-shaped recovery is less likely in this downturn. Instead, the region may experience a shallower but more protracted contraction period.
•
The Houston PMI is based on a survey of some 80 purchasing executives in key Houston industries—oil and gas exploration and production; manufacturing; engineering and construction; chemicals; distribution; health care; and business and financial services. It measures over-the-month changes in sales (new orders), production, employment, purchases of new equipment, prices paid for major purchases, lead times from sellers, purchased materials inventory and finished goods inventory.
Partnership Research
December 2015
Purchasing Managers Index
ANNUAL AVERAGES Houston
2005
61.5
2006
55.5
2008
54.3
United States
62.0
2007
53.9
2009
45.6
44.9
60.1
55.3
2014
58.5
51.1
2010
46.3
2012
2011
59.2
55.1
57.5
2013
51.7
58.4
53.9
YTD Average - October ’15
56.5
55.8
47.0
52.0
Note: The PMI has a possible range from zero to 100. Readings above the neutral point of 50 indicate likely growth in production over the next three to four months; readings below 50 suggest contraction. The Houston and U.S. Purchasing Managers Indexes are conceptually similar but not identical. Source: Institute for Supply Management-Houston
December 2015
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Oil and Natural Gas Prices Surging oil produc tion and weak global demand have pushed oil prices to $40 a barrel in November ’15. SPOT CRUDE AND NATURAL GAS PRICES Monthly Averages Natural Gas
140
14
120
12
100
10
80
8
60
6
40
4
20
2 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
Natural Gas, $ /MMBtu
WTI, $ barrel
WTI
’16
Source: U.S. Energy Information Administration
18
•
The spot market closing price for a barrel of West Texas Intermediate (WTI), the benchmark U.S. light crude, fell from $108 in June ’14 to $40 in November ’15, a 62 percent decline. The drop in prices resulted from expanding U.S. domestic production coupled with weak global economic growth.
•
A brief moment of optimism was felt in May and June of this year when oil prices hovered around $60, but news of the Iran nuclear deal and the prospect of Iranian oil hitting the market resulted in additional downward pressure on prices.
•
The spot price for natural gas followed that of oil, falling from its recent peak of $6 per million British thermal units (MMBtu) in February ’14 to $2 in November ’15.
•
In its November Short-Term Energy Outlook, the U.S. Energy Information Administration forecasts WTI spot prices to average $49.88 per barrel in ’15 and $51.31 in ’16. Henry Hub natural gas spot prices are projected to average $2.77 per MMBtu in ’15 and $3.09 in ’16.
•
Gulf Coast petrochemical manufacturers, unlike many of their counterparts elsewhere, rely heavily on natural gas as a feedstock. As a rule of thumb, Gulf Coast plants can compete on the world market so long as the ratio of oil price to gas price exceeds 6. The ratio is expected to stay above that level over the next several decades. As a result, U.S. and foreign companies have announced a major expansion of chemical plants. The American Chemistry Council has identified 246 chemical industry investment projects valued at $153 billion that have been publicly announced; approximately $50 billion will be spent on projects in the Houston area. Partnership Research
December 2015
Oil and Natural Gas Prices Spot Market Prices for West Texas Intermediate Crude Oil and Henr y Hub Natural Gas 52-WEEK AVERAGE OF CLOSING PRICES Spot Market Crude Oil Price ($/bbl)
2005
$56.64
2006
$8.69
2008
$99.67
$8.86
$6.73
$61.95
$4.00
$94.05
$72.34
$6.97
2010
$3.94
2012
2014
$93.17
$66.05
2007
2009
2011
$94.88
Spot Market Natural Gas Price ($/MMBtu)
$79.48
$4.37
2013
$2.75
$97.98
$3.73
2015 - October 52-week average
$4.37
$53.14
$2.92
Source: U.S. Energy Information Administration
December 2015
Partnership Research
19
Drilling Activity and Oil Prices Paralleling the drop in oil prices, the Nor th American rig count has fallen 60 percent from its previous peak. RIG COUNT AND OIL PRICE Monthly Average Active Domestic Rigs
Monthly Oil Price
2,500
$160 $140 $120 $100
1,500
WTI $/BBl
Active Domestic Rigs
2,000
$80 1,000
$60 $40
500 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: Baker Hughes, Inc.; U.S. Energy Information Administration
20
•
North American oil producers have become a victim of their own success. The shale revolution stimulated tremendous oil and gas production, increasing supply on the world market. However, global energy demand has been weak and unable to absorb the new production.
•
Oil prices have fallen dramatically—from $108/bbl at the June ’14 peak to $40/bbl in November ’15. Drilling activity responded swiftly, and the rig count dropped from a high of 1,931 in September ’14 to 757 as of mid-November ’15, a 60.8 percent decline.
•
Strong growth in the rig count is unlikely in ’16. A Barclays survey of 175 oil companies found that their capital spending will be cut by another 10 to 15 percent, or $12.6 billion to $18.9 billion, in North America in ’16. These cuts come on top of the $68.3 billion reduction this year. Capital spending by these same companies totaled $194.1 billion in ’14, $125.8 billion in ’15 and is projected to be as low as $106.9 billion in ’16.
Partnership Research
December 2015
Drilling Activity and Oil Prices Ac tive Domestic Rotar y Rig Count and Price of West Texas Intermediate Crude ANNUAL AVERAGE Active Domestic Rotary Rigs
2005
1,381
2006
$56.64
2008
1,877
$99.67
$66.05
1,767
1,086
$94.88
1,919
$72.34
2010
$61.95
1,544
2012
2014
1,838
1,648
2007
2009
2011
1,874
Spot Market Crude Oil Price ($/bbl)
$79.48
2013
$94.05
1,762
$97.98
2015 - October 52-week average*
$93.17
1,118
$53.14
*The rig count did not fall below 1,000 until April ’15 and has dropped to 767 as of mid-November. Sources: Baker Hughes Incorporated, Energy Information Agency
December 2015
Partnership Research
21
Foreign Trade The value of foreign trade passing through Houston has nearly doubled over the decade. HOUSTON-GALVESTON CUSTOMS DISTRICT TRADE Value, Billions Imports
Exports
$268.0
$274.3
119.4
127.1
$251.9
$240.9 $211.5 $185.3
89.9
$162.2 $136.5
58.1
47.0 89.4
’05
104.1
’06
72.3
151.0
$167.7
$212.4 128.9
130.6
94.7
115.9 148.6
75.2
147.1 122.9
116.8
113.0
$252.5
121.9 96.5
92.4
’07
’08
’09
’10
’11
’12
’13
’14
’15*
* 12-months ending September '15 The Houston-Galveston Customs District includes the ports of Houston, Galveston, Freeport, Texas City, Corpus Christi, Port Lavaca, Bush Intercontinental Airport and Sugar Land Regional Airport. Source: Wiser Trade
22
•
The Houston-Galveston Customs District handled $252.5 billion trade in ’14, ranking it as the fifth busiest district behind Los Angeles ($417.8 billion), New York ($386.8 billion), Laredo ($279.8 billion), and Detroit ($261.8 billion).
•
Forty-one countries logged more than $1 billion in trade through the customs district in ’14. The 10 largest, which accounted for 51.3 percent of all trade, included Mexico ($28.7 billion), China, ($16.6 billion), Brazil ($15.7 billion), Venezuela ($12.9 billion), Saudi Arabia ($10.9 billion), Colombia ($10.8 billion), Germany ($9.9 billion), the Netherlands ($8.9 billion), South Korea ($8.4 billion), and Russia ($6.8 billion).
•
Imports totaled $121.9 billion in ‘14. The top five imports were oil and oil products ($57.5 billion), industrial machinery ($11.5 billion), articles of iron and steel ($9.5 billion), organic chemicals ($6.0 billion), and electrical machinery ($5.9 billion).
•
Exports totaled $130.6 billion in ’14. Leading exports included refined oil products ($52.9 billion), industrial machinery ($19.8 billion), organic chemicals ($15.9 billion), plastics ($7.0 billion), and electrical machinery ($5.2 billion).
•
The strong U.S. dollar and drop in oil and gas prices have led to a decline in Houston’s total trade through the first three quarters of ’15. Exports are down 14.7 percent from $99.8 billion in September ’14 YTD to $85.2 billion in September ’15 YTD. Imports dropped 27.1 percent from $93.9 billion in September ’14 YTD to $68.5 billion in September ’15 YTD.
•
Despite the decline in total trade value, total vessel weight increased 2.4 percent, from 184.7 billion kilograms to 189.1 billion kilograms. Partnership Research
December 2015
Foreign Trade Houston– Galveston Customs Distric t ANNUAL TOTALS IN FOREIGN TRADE Dollar Value, Billions Imports
Exports
Totals
2005
89.444 47.006 136.451
2006
104.086 58.091 162.178
2007
112.979 72.329 185.309
2008
150.997 89.905 240.903
2009
92.425 75.233 167.659
2010
116.77 94.684 211.456
2011
148.629 119.399 268.028
2012
147.146 127.117 274.263
2013
122.911 128.944 251.855
2014
121.868 130.589 252.457
2015
12-months ending September
96.473 115.925 212.398 Source: Adapted from WISERTrade: International Trade Database, WISER LLC, Copyright 2004. No Claim to Original United States Government Works. All Rights Reserved.
December 2015
Partnership Research
23
Air Passengers Total air passenger volume has grown by eight million passengers since ’05. DOMESTIC AND INTERNATIONAL PASSENGERS Houston Airport System (000,000)
Domestic
48.0
51.1
51.8
7.4
7.7
43.7
44.1
6.9 41.1
’05
’06
’07
50.5 8.0
42.5
’08
International 50.2
50.9
8.6
8.8
9.0
41.0
41.4
41.6
41.9
’10
’11
’12
’13
49.5
50.0
7.8
8.5
40.7
’09
48.5
53.2
54.3
9.8
10.3
43.4
44.0
’14
’15*
* 12-months ending Sep '15 Source: Department of Aviation, Houston Airport System
24
•
In the 12 months ending September 15, the Houston Airport System (HAS) handled 54.3 million passengers, 44.0 million domestic and 10.3 million international. Passenger traffic increased 13.1 percent since ’05.
•
International traffic has been the fastest growing segment of HAS passenger activity, rising at a 4.4 percent compound annual growth rate during the past 10 years compared to a 1.2 percent for domestic passenger traffic. Nearly one in every five HAS passengers is traveling internationally.
•
Thirty-two airlines provide scheduled passenger service from Houston to 124 domestic and 74 international destinations in 35 countries.
•
HAS reached a milestone in October ’15 when Southwest Airlines launched international air service from Hobby Airport, making Houston one of only five U.S. cities with dual international air hubs, the other cities being Chicago, New York, Orlando, and Washington, D.C.
•
The Houston airport system already ranks as the nation’s eighth busiest international gateway. With Hobby expected to eventually handle a million or more international passengers each year, HAS could potentially overtake San Francisco and Atlanta to become the nation’s sixth busiest global gateway.
Partnership Research
December 2015
Air Passengers Houston Airpor t System– Domestic and International Air Passengers ANNUAL TOTALS Domestic (000)
International (000)
Total (000)
2005
41,065.0 6,909.1 47,974.0
2006
43,688.4 7,411.0 51,099.4
2007
44,094.6 7,723.0 51,817.0
2008
42,524.2 7,960.1 50,484.4
2009
40,695.9 7,809.9 48,505.8
2010
41,025.7 8,507.9 49,533.6
2011
41,393.4 8,637.3 50,030.70
2012
41,564.5 8,764.6 50,329.1
2013
41,922.6 8,986.3 50,908.9
2014
43,384.2 9,810.4 53,194.6
2015
September 12-month Total
43,971.80 10,288.90 54,260.7 Source: Houston Airport System
December 2015
Partnership Research
25
Residential Real Estate Houston’s housing market benef ited from pent-up demand and has remained resilient through ’15. HOUSTON MSA RESIDENTIAL HOUSING MARKET Thousands 100
Average Listings (12-Month Total)
Sales (12-Month Total)
90
80
70
60
50
40
30
20 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: Houston Association of Realtors®
26
•
The moving 12-month total of Houston-area property sales has remained above 90,000 since October ’14 and reached a record 91,305 units sold in December ’14. (Property sales include single-family homes, townhomes, condominiums, duplexes, high-rise units, and lots.)
•
The median sales price of single-family homes also reached historic highs, averaging $209,754 for the 12-months ending October ’15, a 7.8 percent increase from $194,566 a year ago.
•
Housing inventory averaged 3.0 months for the 12-months ending October ’15, up from 2.8 months for the same period in ’14. The national housing supply is at 4.8 months of inventory. A six-month inventory is considered a balanced market. Inventory is measured by the estimated number of months it would take to deplete the current active housing inventory based on the previous 12 months of sales.
•
Since the April ’10 census, Houston has added nearly 570,000 residents, the largest gain of any U.S. metro over that period. Approximately 320,000 residents, or 65 percent of the total population growth, came from new residents moving to the region from elsewhere in the United States or abroad.
Partnership Research
December 2015
Residential Real Estate Houston Multiple Listing Ser vice Data HISTORICAL CLOSINGS, SALES PRICES AND LISTINGS
Total Closings
2005
79,012 $142,659 43,379
2008
69,336 $150,724 50,946
2011
63,606 $153,618 48,800
2014
91,305 $197,462 28,363
Median Sales Price*
2006
87,799 $148,350 44,032
2009
63,801 $150,963 45,286
2012
74,116 $162,502 40,247
2015 Oct 12-mo total/avgs
Average Active Listings
2007
83,736 $151,706 50,643
2010
61,004 $153,330 51,097
2013
88,080 $179,737 32,101
90,051 $209,754 30,312
* Average of monthly medians Source: Houston Association of Realtors速
December 2015
Partnership Research
27
Office Market Houston’s of f ice market has yet to feel the full impac t of the energy downturn. OFFICE OCCUPANCY RATES Percent of Completed Space Leased CBD
Suburbs
92
90
88
86
84
82
80
78 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
'16
Source: CBRE
28
•
In Houston―the nation’s fifth-largest office market with 207.2 million square feet (msf) of net rentable area―overall occupancy at the end of the third quarter of ’15 stood at 86.8 percent (91.1 percent in the Central Business District (CBD) and 85.7 percent in the suburbs). Houston’s 107.7 msf of Class A space was 90.2 percent leased.
•
Third quarter ’15 Class A asking lease rates ranged from $46.27 per square foot in the CBD to $34.73 in the suburban submarkets. Overall asking lease rates for Class A space averaged $37.07, Class B $24.05, and Class C $16.15.
•
A total of 10.7 million square feet of office space across 32 buildings was under construction as of Q3/15, with 52.4 percent of the space preleased. According to CBRE, 13 buildings are speculative developments and 9.2 percent are preleased. More than 580,000 square feet of new construction was delivered in the third quarter.
•
Sublease space has nearly doubled in the past year, from 3.6 million square feet in Q3/14 to 7.1 msf in Q3/15. Thus far published asking rates have not been impacted. However, negotiated effective rents have declined and concessions are on the rise.
Partnership Research
December 2015
Office Market Of f ice Occupancy: Houston Metropolitan Statistical Area (MSA) CENTRAL BUSINESS DISTRICT AND SUBURBAN OFFICE OCCUPANCY RATES Percent of Completed Space CBD
2005
2007
2009
2011
2013
2015
Q1
Q2
Q3
Q4
79.7 85.1
81.4 85.6
81.1 86.2
81.9 86.7
Q1
Q2
Q3
Q4
87.5 88.5
88.7 89.0
89.9 89.2
91.1 88.4
Q1
Q2
Q3
Q4
91.5 86.2
91.0 84.6
90.8 83.0
90.2 82.4
Q1
Q2
Q3
Q4
88.3 82.8
85.9 83.0
88.8 83.3
89.3 82.6
Q1
Q2
Q3
Q4
90.3 86.7
91.2 87.0
88.8 87.9
90.8 87.5
Q1
Q2
Q3
Q4
91.3 86.4
91.2 85.4
91.1 85.7
-
Suburbs
2006
2008
2010
2012
2014
Q1
Q2
Q3
Q4
82.2 86.5
82.9 87.3
84.3 87.6
87.5 88.1
Q1
Q2
Q3
Q4
91.1 87.4
91.2 87.4
91.4 87.3
91.7 87.1
Q1
Q2
Q3
Q4
89.9 82.0
89.6 82.0
89.5 82.1
89.8 82.0
Q1
Q2
Q3
Q4
89.3 84.5
89.2 85.2
87.9 86.4
90.3 86.2
Q1
Q2
Q3
Q4
90.7 87.3
90.8 87.2
91.3 87.2
92.1 87.4
Source: CBRE
December 2015
Partnership Research
29
Hotels Hotel ac tivit y rebounded af ter the Great Recession, but slower ac tivit y is expec ted as the energy downturn impac t s occupancy, room rates, and RevPAR. HOUSTON HOTEL DATA Four-Quarter Moving Average Occupancy (%)
RevPAR ($)
Room Rate ($) 110
75
105
%, Average Occupancy, 4-Qtr Avg
100 95
65
90 85
60
80 75
55
70 65
50
60 55
45
50 40
$, Average Room Rate and RevPAR, 4-Qtr Avg
70
45 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
RevPAR = Revenue per available room ($/day) Source: PKF Hospitality Research, LLC
30
•
Houston’s hotel market, home to 77,000 rooms, averaged 70.5 percent occupancy in the four quarters ending Q2/15. The average daily room rate during this period was $108.10 and revenue per available room (RevPAR) averaged $76.25 per day.
•
During the Great Recession, the four-quarter average for occupancy fell as low as 53.9 percent, average room rates ran $88.24, and RevPAR dropped to $48.00. Houston hotels began their recovery in ’11 as business and leisure travel resumed.
•
Hotel activity peaked at the end of ’14 and early ’15. The four-quarter average for occupancy reached a high of 71.9 percent in Q4/14 and RevPAR hit a historic high of $77.20 in Q1/15. Average room rates set a record of $108.10 in the four quarters ending Q2/15.
•
PKF Hospitality Research expects a decrease of 3.5 percent in RevPAR by the end of ’15. The decline is a result of an estimated 4.4 percent drop in occupancy. Both the upper, and lower-priced segments of Houston’s hotel market are expected to report a decline in RevPAR by year-end.
Partnership Research
December 2015
Hotels Occupancy, Average Room Rates and Revenue Per Available Room ANNUAL AVERAGES Occupancy
2005
67.3% $79.07 $53.29
2008
67.6% $104.75 $70.92
2011
59.8% $90.49 $54.13
2014
71.9% $106.90 $76.93
Average Room Rate
2006
66.2% $88.16 $58.34
2009
55.4% $91.64 $51.00
2012
65.4% $94.10 $61.47
2015
Average of Four Quarters ending Q2/15
Revenue Per Available Room
2007
66.2% $95.75 $63.44
2010
55.0% $88.24 $48.57
2013
69.0% $101.27 $69.94
70.5% $108.10 $76.25
Source: PKF Hospitality Research, LLC
December 2015
Partnership Research
31
Retail Sales Houston MSA retail sales reached a record $126 billion in Q3/14, but dropped in Q1/15 due to lower gas prices. HOUSTON MSA GROSS RETAIL SALES Four-Quarter Moving Totals - $ Billions Nominal
2006 Constant U.S. Dollars
$140
$120
$100
$80
$60 ’07
’08
’09
’10
’11
’12
’13
’14
’15
Source: Texas Comptroller of Public Accounts
32
•
The Houston metro area’s nominal gross retail sales reached a record of $126.3 billion in the four quarters ending Q3/14, according to the Texas Comptroller’s Office. Retail sales decreased to $119.1 billion in Q1/15, the most recent data available. The decline over this period is attributed to a 64.5 percent decrease in gas station retail sales.
•
The top three retail sales categories in Q1/15 were motor vehicles ($4.5 billion, 19.0 percent share), food and beverage ($3.8 billion, 16.0 percent share), and general merchandise ($3.3 billion, 14.0 percent share). Gas station sales are typically in the top three, but its share of total sales dropped to 11.7 percent in Q1/15, down from a 28.0 percent share in Q3/14.
•
The majority of the region’s retail sales occurred in three counties: Harris County (75.2 percent of Q1/15 sales), Fort Bend County (8.2 percent), and Montgomery County (7.0 percent).
•
In the third quarter of ’15, CBRE reported a total of 213.4 million square feet of rentable retail space and a vacancy rate of 5.9 percent in the Houston market. New retail space under construction totaled 2.4 million square feet.
Partnership Research
December 2015
Retail Sales Houston-The Woodlands-Sugar Land MSA Gross Retail Sales ANNUAL TOTALS Nominal Sales ($000,000)
2006
$76,207.9
2007
$76,207.9
2008
$101,402.1
$96,418.4
$84,100.5
$87,864.5
$83,125.2
$100,872.9
$90,879.6
2013
$95,524.1
2014
$122,952.5
$82,591.2
2011
2012
$108,257.6
$84,056.8 2009
2010
$90,404.1
Constant 2006 Dollars ($000,000)
$116,366.8
$101,263.8
2015 - 4 Quarters ending Q1
$104,090.3
$119,067.8
$100,887.5
Source: Texas Comptroller of Public Accounts
December 2015
Partnership Research
33
New Car, Truck and SUV Sales Sales of trucks and SUVs bolstered the Houston-area vehicle market in ’15. NEW CAR, TRUCK AND SUV SALES - HOUSTON MSA Units (000), 12 Mo Ending Cars
Trucks and SUVs
230
210
190
170
150
130
110
90 ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: TexAuto Facts Report, InfoNation, Inc., Sugar Land, TX
34
•
Houston-area vehicle sales reached a historic high with a record 377,705 vehicles sold in the 12 months ending October ’15, surpassing the previous peak of 376,598 vehicles sold in the 12 months ending January ’15.
•
Low oil prices have encouraged consumers to purchase more trucks and SUVs than cars during the past 12 months. Truck and SUV sales accounted for all of the growth in vehicle sales. Car sales declined 5.1 percent from 160,383 in the 12 months ending October ’14 to 152,208 in the 12 months ending October ’15. During the same period, truck and SUV sales rose 6.5 percent from 211,824 to 225,497. The market share of trucks and SUVs reached an all-time high of 62.4 percent in October ’15, far above the 10-year average of 56.6 percent market share.
•
Strong truck sales bumped up the average retail sales price per vehicle to $35,470 for the Houston region, the highest since February ’15. The average retail sales price for the truck/SUV segment was $38,760 in October ’15 compared to $29,890 for cars.
Partnership Research
December 2015
New Car, Truck and SUV Sales Houston Metropolitan Statistical Area ANNUAL TOTALS Houston-Sugar Land-Baytown MSA* Cars
Trucks and SUVs
Totals
2005
140,737 181,331 322,068
2006
153,058 196,580 349,638
2007
149,677 209,093 358,770
2008
140,088 166,772 306,860
2009
100,129 118,581 218,710
2010
105,753 134,601 240,354
2011
107,552 147,444 254,996
2012
143,061 182,027 325,088
2013
153,210 194,649 347,859
2014
158,899 214,099 373,998
2015
Average of Four Quarters ending Q2/15
152,208 225,497 377,705
* Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, San Jacinto and Waller counties. Austin and San Jacinto counties were added in January 2007, but the series may be treated as continuous because those counties have a negligible impact on the totals. Source: TexAuto Facts Report, InfoNation, Inc., Sugar Land, TX
December 2015
Partnership Research
35
Inflation Low energy prices helped suppress inf lation in ’15. INFLATION, 12-MONTH CHANGE
Houston CPI-U
U.S. CPI-U
6% 5% 4% 3% 2% 1% 0% -1% -2% ’05
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: U.S. Bureau of Labor Statistics, not seasonally adjusted
36
•
The cost of consumer goods and services as measured by the Consumer Price Index for All Urban Consumers (CPI-U) rose 0.2 percent nationwide from October ’14 to October ’15, according to the U.S. Bureau of Labor Statistics. The annual change in the U.S. CPI-U has tracked below one percent for the past 11 months. Over this same period, core inflation (all items less the volatile food and energy categories) recorded annual increases between 1.6 percent and 1.9 percent.
•
From October ’14 to October ’15, consumer prices in the Houston-Galveston-Brazoria metro area (Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller Counties) slipped 0.1 percent. Core inflation rose 2.9 percent over the year.
•
In the 12 months ending October ’15, Houston’s energy index fell 26.5 percent as all subcomponents registered declines. Motor fuels experienced the largest drop, falling 33.3 percent. Electricity decreased 16.5 percent and natural gas 11.8 percent.
•
Houston’s food prices rose 1.1 percent from October ’14 to October ’15. The cost of dining out increased 2.7 percent while grocery prices decreased 0.2 percent, the grocery component’s first annual decline since September ’03. During the same period, the cost of shelter rose 6.2 percent, the fastest annual growth in housing since the year ending August ’09. Renters’ costs advanced 7.7 percent and owners’ equivalent rent rose 6.1 percent. (“Owners’ equivalent rent” is the amount a homeowner would pay to rent or would earn from renting his or her home in a competitive market.)
Partnership Research
December 2015
Inflation
CONSUMER PRICE INDEX ANNUAL PERCENT CHANGE Houston CPI-U
2005
4.24
2006
3.42
2008
-0.17
0.09
2.54
2.69
2.96
1.00
3.93
4.08
2010
2.72
2012
2014
1.12
1.13
2007
2009
2011
3.08
U.S. CPI-U
1.86
1.50
2013
1.74
3.62
1.50
2015 - October YOY Change
0.76
-0.10
0.17
Source: U.S. Bureau of Labor Statistics
December 2015
Partnership Research
37
Cost of Living Comparison Houston of fers a low cost of living while maintaining a high qualit y of life with the amenities expec ted in a world- class cit y. COST OF LIVING COMPARISON - 20 MOST POPULOUS U.S. METROS % Below/Above U.S. Average 64.3
San Francisco, CA 56.3
New York, NY 49.2
San Diego, CA
45.7
Boston, MA
43.9
Los Angeles, CA
40.2
Washington, DC 21.1
Seattle, WA 14.9
Baltimore, MD
12.5
Miami, FL
11.6
Philadelphia, PA
9.2
Chicago, IL Minneapolis, MN -1.0 -2.4 -3.6 -5.3
5.8 Dallas, TX Phoenix, AZ Detroit, MI Atlanta, GA
-7.2
Houston, TX
-7.3
St. Louis, MO
-10.1
Tampa, FL Note: Riverside, California is one of the 20 most populous MSAs, but did not submit COLI data for Q3 2015.
Source: Council for Community and Economic Research (C2ER), Cost of Living Index, Q3 2015 (Data based on a survey of 265 urban areas, published October 2015).
38
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The C2ER Cost of Living Index for Q3 2015 shows Houston has the third lowest cost of living among the nation’s 20 most populous metropolitan areas. Houston’s overall after-taxes living costs are 7.2 percent below the average for all 265 urban areas participating in the survey, partly due to housing costs that are 7.7 percent below the national average.
•
Houston’s housing costs are 37 percent below the average for the 20 most populous U.S. metros, and its overall costs are 21.2 percent below the average for this group. If one excludes the five most expensive housing markets—San Francisco, New York, San Diego, Washington, D.C., and Los Angeles—which tend to skew the average, Houston’s housing costs are still 19.9 percent below the major metro average.
Partnership Research
December 2015
Cost of Living Comparison
COST OF LIVING COMPARISONS – 20 MOST POPULOUS U.S. METROS* RANKED FROM MOST TO LEAST EXPENSIVE (AVERAGE FOR 265 URBAN AREAS = 100) Composite
Groceries
Housing
Utilities
Transportation
Healthcare
Misc Goods & Services
San Francisco-Oakland-Hayward, CA
164.3 130.2 277.9 107.3 128.1 115.8 118.4
New York-Newark-Jersey City, NY-NJ-PA
156.3 118.2 252.9 124.5 114.2 109.4 121.1
San Diego-Carlsbad, CA
149.2 109.5 243.3 123.8 138.1 108.3 102.0
Boston-Cambridge-Newton, MA-NH
145.7 101.1 200.9 149.8 108.0 135.5 131.5
Los Angeles-Long Beach-Anaheim, CA
143.9 107.1 215.6 117.9 151.5 107.5 107.6
Washington-Arlington-Alexandria, DC-VA-MD-WV
140.2 111.3 222.8
Seattle-Tacoma-Bellevue, WA
121.1 112.7 135.9 101.5 117.5 121.8 119.4
Baltimore-Columbia-Towson, MD
114.9 120.6 144.0
92.5 103.8
Miami-Fort Lauderdale-West Palm Beach, FL
112.5 106.5 138.0
91.9 109.1 102.6 101.9
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
111.6 110.6 120.4 115.6 100.7 100.1 108.9
Chicago-Naperville-Elgin, IL-IN-WI
109.2 112.5 119.3 101.6 113.0 103.6 100.8
Minneapolis-St. Paul-Bloomington, MN-WI
105.8 107.4 107.8
99.2 110.3
90.7 111.8
87.5 102.2
92.8 102.5 106.0 109.0
Dallas-Fort Worth-Arlington, TX
99.0
94.2
95.2
97.3 106.0 101.3 102.0
Phoenix-Mesa-Scottsdale, AZ
97.6
92.5
96.3
98.7 107.7
97.0
96.8
Detroit-Warren-Dearborn, MI
96.4
89.9
89.7 104.4 111.3
94.1
97.2
Atlanta-Sandy Springs-Roswell, GA
94.7 103.3
82.8
90.1
97.1 103.2 100.7
Houston-The Woodlands-Sugar Land, TX
92.8
92.3
95.7
91.2
96.7
96.5
St. Louis, MO-IL
92.7 105.9
71.5 119.4
99.9
96.7
93.7
Tampa-St. Petersburg-Clearwater, FL
89.9
77.5
95.3
90.7
94.0
83.3
98.7
92.1
*Riverside, California is among the 20 most populous MSAs, but did not submit COLI data for Q3 2015. Note: Data are unweighted averages for all reporting places in each metropolitan area. Source: Council for Community and Economic Research (C2ER), Cost of Living Index, Q3 2015 (Data based on a survey of 265 urban areas, published October 2015).
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Housing Cost Comparison Houston’s housing cost s are among the lowest of the major U.S. metro areas. HOUSING COST COMPARISON - 20 MOST POPULOUS U.S. METROS % Below/Above U.S. Average 177.9
San Francisco, CA 152.9
New York, NY
143.3
San Diego, CA 122.8
Washington, DC
115.6
Los Angeles, CA
100.9
Boston, MA 44.0
Baltimore, MD
38.0
Miami, FL
35.9
Seattle, WA Philadelphia, PA
20.4
Chicago, IL
19.3 7.8
Minneapolis, MN -3.7
Phoenix, AZ
-4.8
Dallas, TX
-7.7 -10.3 -17.2 -22.5 -28.5
Houston, TX Detroit, MI Atlanta, GA Tampa, FL St. Louis, MO
Note: Riverside, California is one of the 20 most populous MSAs, but did not submit COLI data for Q3 2015. Source: Council for Community and Economic Research (C2ER), Cost of Living Index, Q3 2015 (Data based on a survey of 265 urban areas, published October 2015).
40
•
The C2ER Cost of Living Index for Q3 2015 shows that Houston’s housing costs are 7.7 percent below the nationwide average and 37 percent below the average for the 20 most populous U.S. metros. Lower housing costs are one of the reasons Houston’s overall living costs are 7.2 percent below the nationwide average for places of all sizes and 21.2 percent below the large-metro average. (This housing index is based 73.8 percent on homeownership and 26.2 percent on rental occupancy.)
•
Even if Houston home values continue to appreciate and the apartment market continues to grow, Houston’s housing should remain inexpensive in the context of many other major metro areas.
Partnership Research
December 2015
Housing Cost Comparison
HOUSING COST COMPARISON – 20 MOST POPULOUS U.S. METROS* (AVERAGE FOR 265 URBAN AREAS = 100) Percent Above or Below the Nationwide Average
Housing Cost Index**
Average Price for New 2,400-Square-Foot House***
San Francisco-OaklandHayward, CA
New York-Newark-Jersey City, NY-NJ-PA
San Diego-Carlsbad, CA
277.9
252.9
243.3
177.9%
$902,084
152.9%
$827,997
143.3%
Washington-ArlingtonAlexandria, DC-VA-MD-WV
Los Angeles-Long BeachAnaheim, CA
Boston-CambridgeNewton, MA-NH
222.8
215.6
200.9
122.8%
$735,108
Baltimore-ColumbiaTowson, MD
144.0
44.0%
115.6%
$635,359
Miami-Fort LauderdaleWest Palm Beach, FL
$465,384
138.0
38.0%
100.9%
$417,294
135.9
35.9%
Chicago-Naperville-Elgin, IL-IN-WI
Minneapolis-St. PaulBloomington, MN-WI
120.4
119.3
107.8
$383,496
19.3%
$571,760
Seattle-Tacoma-Bellevue, WA
Philadelphia-CamdenWilmington, PA-NJ-DE-MD
20.4%
$802,495
$366,231
7.8%
$416,014
$339,612
Phoenix-Mesa-Scottsdale, AZ
Dallas-Fort Worth-Arlington, TX
Houston-The WoodlandsSugar Land, TX
96.3
95.2
92.3
-3.7%
$294,656
-4.8%
$281,334
Detroit-Warren-Dearborn, MI
Atlanta-Sandy Springs-Roswell, GA
89.7
82.8
-10.3%
$267,249
-17.2%
Tampa-St. Petersburg-Clearwater, FL
St. Louis, MO-IL
77.5
71.5
-22.5%
$222,464
-28.5%
-7.7%
$266,788
$243,123
$209,306
* Riverside, California is one of the 20 most populous MSAs, but did not submit COLI data for Q3 2015. ** Index is based 73.8 percent on homeownership costs and 26.2 percent on apartment rent. *** Approximately 2,400 square foot home with 4 bedrooms, 2 baths, family-room (or equivalent), 2-car garage and 8,000 square foot lot. Neighborhoods are typical for corporate middle-management transferees. Source: Council for Community and Economic Research (C2ER), Cost of Living Index, Q3 2015 (Data based on a survey of 265 urban areas, published October 2015).
December 2015
Partnership Research
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Houston Region Population Houston has a sustained histor y of strong population grow th. HOUSTON REGION POPULATION MILLIONS City of Houston
7
Harris County
Houston-The Woodlands-Sugar Land MSA
6 5 4 3 2 1 0 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2013 2014 Source: U.S. Census Bureau
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•
From the first census in Texas in 1850 through the 2014 intercensal estimates, the Houston-The Woodlands-Sugar Land Metropolitan Statistical Area—has averaged a compound annual growth rate of 3.4 percent.
•
The Houston-The Woodlands-Sugar Land MSA is the nation’s fifth most populous metropolitan area. As Houston’s population has grown, the region has climbed in the rankings. In ’70, Houston was the nation’s 14th most populous metro. Today, Houston is the nation’s fifth. Over that period, three metros—Cleveland, Detroit and San Francisco—have slipped from the top 10 and three metros—Atlanta, Miami and Houston—took their places.
•
Between July 1, 2010 and July 1, 2014 (the period for which the Bureau of the Census released its most recent population estimates), metro Houston added 569,690 residents, the largest gain of any U.S. metro over that period. About 45 percent of Houston’s growth comes from natural increase (births minus deaths) and around 55 percent comes from net in-migration (more residents moving in than out).
Partnership Research
December 2015
Houston Region Population POPULATION TOTALS
Houston-The Woodlands-Sugar Land Metropolitan Statistical Area*
27,984 1850
1890
1930
1970
Harris County
55,317
4,688
1860
City of Houston
80,866
9,070
1870
112,053
17,375
1880
27,985
2,396
4,845
9,332
16,513
137,800
202,438
252,066
348,661
37,249
1900
63,768
1910
115,693
1920
186,667
27,557
44,633
78,800
138,276
545,547
752,937
1,083,100
1,594,894
359,328
1940
528,961
1950
806,701
1960
1,243,158
292,352
384,514
596,163
938,219
2,195,146
3,135,806
3,750,411
4,693,161
1,741,912
1980
1,233,505
2,409,544 1,595,138
5,920,416 2010
1990
4,092,459 2,099,451
2,818,199 1,630,553
6,313,158 2013
4,336,853 2,195,914
2000
3,400,578 1,953,631
6,490,180 2014 **
4,441,370 2,239,558
* Census numbers for the 2013 MSA definition, which includes the nine counties of Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller. ** As of July 1, 2014 Source: U.S. Census Bureau
December 2015
Partnership Research
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Foreign-Born Population Nearly one in four Houstonians was born outside the U.S. PLACE OF BIRTH OF FOREIGN-BORN POPULATION Houston-The Woodlands-Sugar Land MSA 2014
25.2%
Mexico
Asia
41.0%
15.7%
Other
Central America
5.1% 3.7% 4.6% 4.7% Europe
Africa South America
Source: U.S. Bureau of the Census, 2014 American Community Survey
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In 2014, the Houston Metropolitan Statistical Area (MSA) contained an estimated 1.5 million residents born outside the United States, according to the Census Bureau’s American Community Survey (ACS). This figure represents 23.1 percent of all residents, up slightly from 2013.
•
Mexico accounts for forty percent of all foreign-born Houston residents (613,978). El Salvador was the birthplace of the next largest of this group (126,387), followed by Honduras (58,215), Guatemala (37,388) and Colombia (23,825).
•
More than one in four foreign-born Houstonians—an estimated 377,829 persons—were born in Asia. Asian nations that are the birthplaces of the largest numbers of Houstonians are Vietnam (82,227), India (81,843), China (54,979), Philippines (41,564), Pakistan (27,996), Korea (12,821) and Iran (8,291).
Partnership Research
December 2015
Foreign-Born Population Houston is a magnet for international migration. PERCENT OF METRO POPULATION FOREIGN-BORN 20 Most Populous Metro Areas 39.2
Miami, FL 33.7
Los Angeles, CA 30.4
San Francisco, CA
28.8
New York, NY San Diego, CA
23.2
Houston, TX
23.1 22.6
Washington, DC
21.9
Riverside, CA Dallas, TX
17.9
Chicago, IL
17.6
Boston, MA
17.6
Seattle, WA
17.2 14.5
Phoenix, AZ Atlanta, GA
13.4
Tampa, FL
13.0
Philadelphia, PA
10.2
Minneapolis, MN
10.1
Baltimore, MD
10.1 9.4
Detroit, MI St. Louis, MO
4.2
Source: U.S. Census Bureau, 2014 American Community Survey
•
In ’14, nearly one in four Houstonians was foreign-born, versus one in eight nationwide, according to the Census Bureau’s 2014 American Community Survey.
•
In only five of the nation’s 20 most populous metropolitan areas—Miami, Los Angeles, San Francisco, New York and San Diego—do foreign-born residents represent a larger share of total population than in Houston.
•
Houston’s foreign-born population of 1.5 million is greater than the total populations of 11 states and the District of Columbia.
December 2015
Partnership Research
45
Most Populous Metropolitan Areas Houston is the f if th most populous metro in the nation. POPULATION ESTIMATES U.S. Metros Residents July 1, 2014 20,092,883
New York-Newark-Jersey City, NY-NJ-PA
Dallas-Fort Worth-Arlington, TX Houston-The Woodlands-Sugar Land, TX
90,797
13,262,220
Los Angeles-Long Beach-Anaheim, CA Chicago-Naperville-Elgin, IL-IN-WI
Residents added 7/1/13 to 7/1/14
9,554,598
86,371 9,802
6,954,330
131,217
6,490,180
156,371
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
6,051,170
Washington-Arlington-Alexandria, DC-VA-MD-WV
6,033,737
66,561
Miami-Fort Lauderdale-West Palm Beach, FL
5,929,819
66,361
Atlanta-Sandy Springs-Roswell, GA
5,614,323
Boston-Cambridge-Newton, MA-NH
4,732,161
San Francisco-Oakland-Hayward, CA
4,594,060
Phoenix-Mesa-Scottsdale, AZ
4,489,109
Riverside-San Bernardino-Ontario, CA
4,441,890
Detroit-Warren-Dearborn, MI
4,296,611
14,942
88,891 34,112 64,406 84,980 51,628 1,217
Seattle-Tacoma-Bellevue, WA
3,671,478
57,857
Minneapolis-St. Paul-Bloomington, MN-WI
3,495,176
San Diego-Carlsbad, CA
3,263,431
40,873
Tampa-St. Petersburg-Clearwater, FL
2,915,582
41,428
St. Louis, MO-IL
2,806,207
Baltimore-Columbia-Towson, MD
2,785,874
33,742
4,620 11,824
Source: U.S. Census Bureau
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46
Between July 1, 2013 and July 1, 2014 (the period for which the U.S. Census Bureau released its most recent population estimates), the Houston-The Woodlands-Sugar Land Metropolitan Statistical Area (MSA) added more residents than any other U.S. metro area. Partnership Research
December 2015
Most Populous Cities Houston is the four th most populous cit y in the nation. POPULATION ESTIMATES U.S. Cities Residents July 1, 2014 8,491,079
New York, NY
52,700
3,928,864
Los Angeles, CA
30,924
2,722,389
Chicago, IL Houston, TX
Residents added 7/1/13 to 7/1/14
82
2,239,558
35,752
Philadelphia, PA
1,560,297
Phoenix, AZ
1,537,058
24,616
San Antonio, TX
1,436,697
24,931
San Diego, CA
1,381,069
21,225
1,281,047
20,322
Dallas, TX San Jose, CA Austin, TX
4,245
1,015,785
11,964
912,791
Jacksonville, FL
853,382
San Francisco, CA
852,469
Indianapolis, IN
848,788
Columbus, OH
835,957
Fort Worth, TX
812,238
Charlotte, NC
809,958
Detroit, MI
680,250
El Paso, TX
679,036
Seattle, WA
668,342
25,667 9,368 11,331 5,413 12,421 18,183 16,007 -6,424 2,245 14,938 Source: U.S. Census Bureau
•
Between July 1, 2013 and July 1, 2014 (the period for which the U.S. Census Bureau released its most recent population estimates), only New York City added more residents than the city of Houston.
December 2015
Partnership Research
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Most Populous Counties Harris Count y is the third most populous count y in the nation. POPULATION ESTIMATES U.S. Counties Residents July 1, 2014
Residents added 7/1/13 to 7/1/14 10,116,705
Los Angeles County, CA
5,246,456
Cook County, IL
62,710
-179
4,441,370
Harris County, TX
88,618
4,087,191
Maricopa County, AZ San Diego County, CA
3,263,431
Orange County, CA
3,145,515
74,027 40,873 23,661
Miami-Dade County, FL
2,662,874
21,008
Kings County, NY
2,621,793
19,420
Dallas County, TX
2,518,638
Riverside County, CA
2,329,271
Queens County, NY
2,321,580
32,555 32,315 17,587
San Bernardino County, CA
2,112,619
King County, WA
2,079,967
Clark County, NV
2,069,681
Tarrant County, TX
1,945,360
Santa Clara County, CA
1,894,605
23,498
Broward County, FL
1,869,235
23,842
Bexar County, TX
1,855,866
Wayne County, MI
1,764,804
New York County, NY
1,636,268
19,313 33,011 40,365 31,417
33,712 -10,899 4,263 Source: U.S. Census Bureau
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48
Between July 1, 2013 and July 1, 2014 (the period for which the U.S. Census Bureau released its most recent population estimates), Harris County added more residents than any other county in the nation.
Partnership Research
December 2015
The Work Ethic in Houston The work ethic is alive, well, and f lourishing in Houston. THE WORK ETHIC IN HOUSTON “IF YOU WORK HARD IN THIS CITY, EVENTUALLY YOU WILL SUCCEED.” Percent Who Agree 89.3 87.9
88.4
86.8 85.6
85.1 83.0 81.5
81.1
80.6
79.6
79.5 78.2
78.2 76.7
76.4 75.3
74.7
’82
’83
’84
78.3
’85
’86
’87
’88
’89
75.8
76.0
’91
’93
’95
’97 ’99
’01
’03
’05
’07
’09
’11
’13
’15
Source: Kinder Institute, Houston Area Survey
•
Houston’s business success appears related, at least in part, to the overwhelming prevalence of the work ethic here and to confidence that Houston provides an environment in which individual initiative will be rewarded.
•
According to Rice University’s annual Houston Area Survey, a large majority of Houstonians agree that “if you work hard in this city, eventually you will succeed.” In March 1982, when employment in Houston stood at what was then the all-time peak, 81 percent of respondents agreed. In February 1987, when Houston was at the bottom of its recession and unemployment stood above 10 percent, 75 percent of respondents still shared this view. In 1999, 83 percent of Houstonians accepted this statement—a record at the time. In 2001, agreement soared to 88 percent. (By 1990, it had become clear that Houstonians’ responses to this item barely shifted, thus the question is only asked every other year.)
•
In contrast to Houston’s strongly positive attitude, agreement with this same statement in national samples over the same period has ranged only from 58 to 63 percent. The difference between Houston and the nation as a whole is statistically significant and has endured through the entire range of the regional business cycle.
•
The confidence that personal effort will be rewarded in Houston transcends racial and ethnic categories. Over the past six surveys, on average 85 percent of Anglos, 82 percent of Blacks, 88 percent of U.S.-born Latinos, and 94 percent of U.S.-born Asians agreed with the statement.
December 2015
Partnership Research
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Gross Area Product Forecast Real Gross Area Produc t in Houston shows sustained grow th over the nex t quar ter centur y. REAL GROSS AREA PRODUCT FORECAST: HOUSTON-THE WOODLANDS-SUGAR LAND MSA Billions - ’09 Constant Dollars $1,154.1
$1,022.1
$887.2 $754.0 $627.4 $504.1 $380.9 $333.9
’05
’15
’10
’20
’25
’30
’35
’40
Source: The Perryman Group, Summer 2015
50
•
Real (i.e., net of inflation) Gross Area Product (GAP) in the Houston region is expected to grow at an average annual rate of 3.37 percent from ’15 to ’40 in The Perryman Group’s forecast.
•
The Houston MSA’s real gross area product is projected to more than double between ’15 and ’40.
•
Compound annual growth rates of real gross area product from ’15 to ’40 are highest in services (3.9 percent); manufacturing (3.8 percent); mining (3.3 percent); and finance, insurance, and real estate (3.1 percent).
Partnership Research
December 2015
Gross Area Product Forecast Real Gross Area Produc t: Houston-The Woodlands-Sugar Land Metropolitan Area ESTIMATES AND FORECASTS Real Gross Area Product ($ Billions) Constant ’09 Dollars
2005
Compound Annual Growth Rate (Percent), 5 Years Ending
2010
$333.907
-
2015
$380.944
2.67%
2020
$504.067
5.76%
2025
$627.351
4.47%
2030
$753.996
3.75%
2035
$887.155
3.31%
2040
$1022.069
2.87%
$1154.096
2.46%
Source: The Perryman Group, Summer 2015; Growth rate calculations by the Greater Houston Partnership
December 2015
Partnership Research
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Population and Employment Forecast The Perr yman Group forecast s Houston's population and employment to grow faster than the state's and the nation's over the nex t 25 years. POPULATION AND EMPLOYMENT: HOUSTON-THE WOODLANDS-SUGAR LAND MSA Millions Population
Employment 9.9 9.2 8.4
7.7
7.1
6.5
3.0
’15
’20
4.0
3.7
3.4
’25
’30
4.6
4.3
’35
’40
Source: The Perryman Group, Summer 2015
•
From ’15 to ’40, The Perryman Group sees population growth averaging 1.69 percent annually in the Houston region. Over the same period, the Texas-based economic forecasting firm expects wage and salary employment to rise at a 1.62 percent annual rate.
•
The Houston–The Woodlands–Sugar Land Metro Area will add 3.4 million residents between ’15 and ’40. Perryman also forecasts that Houston will add an additional 1.54 million jobs and account for one-fourth of Texas job growth during that time frame.
The Perr yman repor t states: "As a major center for the oil industry and related activity, Houston has been hit by lower oil prices. While the end of the oil surge will affect performance in the near term, the Houston area’s economy is far more diversified than in decades past and the downturn in oil prices is not likely to derail economic performance for an extended period of time. Despite weakness from the lower energy prices and the ripple effects through the economy, expansion in other sectors is expected to moderate the overall negative impact and generate growth in the years to come."
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Partnership Research
December 2015
Population and Employment Forecast Houston-The Woodlands-Sugar Land MSA ESTIMATES AND FORECASTS Population
2015
6,458,000
2020
3,040,000
2025
7,734,000
7,092,000
3,384,000
2030
3,706,000
2035
9,159,000
Payroll Employment
8,422,000
4,018,000
2040
4,312,000
9,946,000
4,576,000
Source: The Perryman Group, Summer 2015
December 2015
Partnership Research
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Top Metro Areas by Gross Domestic Product Houston has the four th largest metro GDP in the nation. GROSS DOMESTIC PRODUCT —TOP 20 METROS $Billion 11
1
20
9
$1,558,518
14 13
3
6
19
8
New York-NewarkJersey City, NY-NJ-PA
1
2
7 16
Los Angeles-Long BeachAnaheim, CA
$866,745 18
3
2 17
10
15
Chicago-NapervilleElgin, IL-IN-WI
$610,552
5
4
4 12
5
Dallas-Fort WorthArlington, TX
$504,358 9
Boston-CambridgeNewton, MA-NH
$382,459 13 Detroit-WarrenDearborn, MI
$236,500 17 San Diego-
Carlsbad, CA $206,817
6
Washington-ArlingtonAlexandria, DC-VA-MD-WV
$471,584 10 Atlanta-Sandy SpringsRoswell, GA
$324,881 14 Minneapolis-St. PaulBloomington, MN-WI
$235,733 18 Denver-AuroraLakewood, CO
$187,111
7
San Francisco-OaklandHayward, CA
$411,969 11 Seattle-TacomaBellevue, WA
$300,827 15 Phoenix-MesaScottsdale, AZ
$215,214 19 Baltimore-ColumbiaTowson, MD
$173,516
Houston-The WoodlandsSugar Land, TX
$525,397 8
Philadelphia-CamdenWilmington, PA-NJ-DE-MD
$391,118 12 Miami-Fort LauderdaleWest Palm Beach, FL
$299,161 16 San Jose-SunnyvaleSanta Clara, CA
$213,819 20 Portland-VancouverHillsboror, OR-WA
$159,328
Source: U.S. Bureau of Economic Analysis, 2014 GDP by Metropolitan Area, current dollars
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•
The U.S. Bureau of Economic Analysis (BEA) estimates Houston’s gross domestic product (GDP) reached $525.4 billion in ’14, ranking it as the nation’s fourth largest metro economy. The Houston region has a gross domestic product greater than 41 states.
•
If Houston were an independent nation, the region would have the 26th largest economy in the world, placing it behind Belgium ($527.8 billion) and ahead of Norway ($511.6 billion).
Partnership Research
December 2015
Publication underwritten by:
Patrick Jankowski, CCR
Jenny Philip
Senior Vice President, Research
Senior Manager, Economic Research
Follow me on Twitter: @pnjankowski
Read my blog: houston.org/economy/blog
Connect with me: linkedin.com/in/pnjankowski