November 2016 ©2016, Greater Houston Partnership Page 1

Better Times Ahead? — The worst

may be over for the energy industry.

The price of crude has more than dou-

bled from its February trough. The

North American drilling fleet has added

more than 150 rigs over the past five

months. Announcements of layoffs in

the oil patch are less frequent. And bellwether companies, like Halliburton and Schlumberg-

er, reported profits―albeit small ones―in the third quarter.

But other sectors of Houston’s economy continue to struggle. Construction has tapered off.

Retail sales have slipped. Vehicle purchases are at their lowest level in five years. Sales tax

collections trail last year’s pace. Fewer passengers are flying out of Bush Intercontinental

Airport. And million-dollar homes go unsold in The Woodlands.

How long before these sectors improve as well? The answer is forthcoming. On December 9,

the Partnership will host the 2017 Houston Region Economic Outlook and address the issues

of energy, construction, consumer confidence and job growth for next year.

The event begins at 10 a.m. with a panel of experts from the energy, health care, finance and

real estate industries sharing their insights into Houston’s economy. KHOU-11 anchor

Shern-Min Chow will moderate the discussion. The panelists:

• Vicki Hollub, CEO, Occidental Petroleum;

• John Sotoodeh, Regional Banking Executive, Wells Fargo;

• Richard J. Campo, Chairman and CEO, Camden Property Trust; and

• Marc L. Boom, M.D., President and CEO, Houston Methodist.

Hollub is the panel’s energy expert. Occidental has operations in the U.S., Middle East and

Latin America. The Fortune 500 company relocated its headquarters to Houston in ’14 and is

the leading acreage holder and largest operator and producer of oil in the Permian Basin.

Sotoodeh is the panel’s finance expert. Wells Fargo is the world’s second largest bank by

market capitalization and third largest by assets. In Houston, the bank has more than 200

branches and $25.1 billion in deposits.

Campo is the panel’s real estate expert. Camden Property Trust is one of the largest publicly

traded multifamily companies in the U.S. He is also chairman of Houston First Corporation

and the Houston Super Bowl Host Committee.

A publication of the Greater Houston Partnership Volume 25 Number 11 — November 2016

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 2

Boom is the panel’s health care expert. Houston Methodist is one of the most comprehensive

teaching hospitals in the United States. The system includes eight hospitals, seven acute care

facilities, and more than a hundred specialty physician groups in Houston. U.S. News and

World Report consistently ranks Houston Methodist as “One of America's Best Hospitals.”

Those attending the morning session will receive a copy of Houston Economic Highlights, 60

pages of insights into local economic and demographic trends over the past 10 years. A copy

of the Highlights publication distributed at last year’s event can be found here.

The luncheon portion of the event convenes at noon. Patrick Jankowski, the Partnership’s

Senior Vice President of Research, will present the Partnership’s employment forecast for

’17. (Click here to see the ’16 forecast.) Dr. Kevin Swift, chief economist and managing di-

rector at the American Chemistry Council, will deliver the keynote address. Dr. Swift is re-

sponsible for economic analyses dealing with policy issues and the business environment.

Full-program tickets include the panel discussion, the Partnership’s forecast, the luncheon,

the keynote speech, a copy of the forecast and Houston Economic Highlights. Luncheon tick-

ets include only the forecast and keynote address. To register for the event, go to the Events

section of the Partnership’s webpage, www.houston.org, or click here.

Houston vs. Our Peers — In the October Houston: The Economy at a Glance, the Partner-

ship examined data from the U.S. Census Bureau’s American Community Survey (ACS).1

The newsletter focused on how Houston’s demographic profile has shifted over the past 10

years. In this issue, the Partnership examines ACS data for the nation’s 20 most populous

metro areas. The ACS covers 47 topics, but the Partnership focused on six that tell much

about the similarities and differences among Houston and its peers. The topics include age,

educational attainment, race, place of origin, transportation to work, and health insurance.

Age: The Houston-The Woodlands-Sugar

Land metro area has one of the youngest

populations among its peers. The median

age in Houston is 34.1 years. That means

that half of all residents are younger and

half are older than 34.1 years. The median

age for the nation as a whole is 37.8 years.

Houston’s young population translates into

a large supply of entry-level and early-

career workers to meet local hiring needs, a

substantial base of consumers entering their

household formation and wealth-acquisition

years, and a larger population more open to social change.

1 The ACS is the U.S. Census Bureau’s annual snapshot of the nation’s economic, housing and social characteristics. The survey

has been conducted every year since ’05.

MEDIAN AGE, 20 MOST POPULOUS U.S. METROS Metro Area Median

Age Metro Area Median

Age

Houston 34.1 Chicago 37.0 Riverside 34.1 Seattle 37.0

Dallas-Fort Worth 34.7 New York 38.1

San Diego 35.5 Philadelphia 38.6

Atlanta 36.1 Boston 38.7 Denver 36.2 San Francisco 38.9 Phoenix 36.3 St. Louis 38.9

Los Angeles 36.4 Detroit 39.9

Washington, D.C. 36.6 Miami 40.9

Minneapolis 36.9 Tampa 42.1 Source: U.S. Census Bureau, American Community Survey, 2015

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 3

Age, Part II: Senior citizens

represent a smaller share of

Houston’s population. Only

one in 10 Houston residents is

over the age of 65 compared

to one in seven in San Fran-

cisco, New York and Boston,

and one in five in Tampa.

Seniors are less likely to be in

the workforce, thus less likely

to contribute to the region’s

economic growth. They also

tend to have lower incomes, make fewer purchases, pay lower taxes, and place greater de-

mands on infrastructure, social services and health care.

Educational Attainment: Though Houston has made progress in recent years, the region’s

educational attainment lags behind that of its peers. When corporations consider a city for a

relocation or major capital investment, a well-educated workforce is as important as a low

cost of doing business and well-developed infrastructure. The Texas Workforce Commission

recently forecast Houston-area employment will add 700,000 jobs between ’14 and ’24, with

roughly one-third of the newly created jobs requiring a high-school diploma and slightly

more than one-third requiring education beyond high school. However, the lack of a well-

educated workforce could result in occupational shortages and inhibit the region’s growth.

HIGHEST LEVEL OF EDUCATION, % OF POPULATION 25 AND OLDER, 20 LARGEST U.S. METROS

Metro Less than

H.S. H.S. or higher

Bachelor's or higher

Metro Area Less than

H.S. H.S. or higher

Bachelor's or higher

Washington, D.C. 9.8 90.2 49.3 Philadelphia 10.1 89.9 36.0

San Francisco 11.7 88.2 47.2 Dallas-Fort Worth 15.5 84.4 33.4

Boston 8.6 91.4 46.0 Los Angeles 20.5 79.5 32.7

Denver 9.5 90.5 41.8 St. Louis 9.0 91.1 32.5

Seattle 7.6 92.3 41.2 Houston 17.7 82.3 31.5

Minneapolis 6.8 93.2 40.3 Miami 15.2 84.8 30.9

New York 14.3 85.7 38.4 Detroit 10.6 89.3 29.5

San Diego 13.4 86.6 37.2 Phoenix 13.5 86.5 29.4

Atlanta 11.3 88.7 37.0 Tampa 10.8 89.3 28.9

Chicago 12.0 87.9 36.0 Riverside 20.3 79.7 20.1 Source: U.S. Census Bureau, American Community Survey, 2015

Place of Origin: Among the 20 most populous metros, Houston ranks fifth in size and sixth in

share of its population that is foreign born. A large immigrant community is important to re-

gional growth for numerous reasons. Immigrants are risk takers. After all, they left their

% RESIDENTS OVER 65, 20 MOST POPULOUS METRO AREAS Metro Area % Metro Area %

Houston 10.1 Chicago 13.1

Dallas-Fort Worth 10.5 San Francisco 14.3

Atlanta 11.2 New York 14.4

Washington, D.C. 11.7 Boston 14.6

Denver 12.0 Phoenix 14.7

Riverside 12.2 Philadelphia 14.8

Seattle 12.6 Detroit 15.1

Minneapolis 12.7 St. Louis 15.2

Los Angeles 12.8 Miami 17.4

San Diego 13.1 Tampa 19.0

Source: U.S. Census Bureau, American Community Survey, 2015

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 4

homeland, facing uncertainty but hoping for a better life in the U.S. Risk taking begets inno-

vation, which in turn begets growth.

Immigrants also tend to

be entrepreneurial. Ac-

cording to the Small

Business Administra-

tion, immigrants are

twice as likely as na-

tive-born citizens to

start a business. Immi-

grants maintain ties to

their homeland, thus

facilitating trade and

investment between the

two countries. A large

immigrant community is important to foreign corporations seeking to establish operations

here. Before agreeing to open an office, manufacturing plant or distribution center in Hou-

ston, the foreign company seeks some assurance that the expat workers assigned here will be

comfortable in the new environment. Growth in one’s immigrant community also tends to be

self-reinforcing. A foreign national is more likely to relocate to a metro with a large popula-

tion of fellow countrymen.

Race: Houston’s racial pro-

file is the most diverse of

the major metros. While San

Francisco has a large Asian

community, few blacks live

in the metro area. While

Miami has a large Hispanic

population, the metro has

few Asians. In Minneapolis,

whites still account for more

than three-fourths of all res-

idents. Houston’s ethnic di-

versity has long been a

strength for the region,

providing cultural, business

and civic opportunities not

available in less diverse

metros.

FOREIGN-BORN POPULATION, 20 MOST POPULOUS METRO AREAS

Metro Estimate

(Millions) % of

Total Pop Metro

Estimate (Millions)

% of Total Pop

Miami 2.398 39.9 Chicago 1.719 18.0

Los Angeles 4.509 33.8 Seattle 0.665 17.8

San Francisco 1.429 30.7 Phoenix 0.654 14.3

New York 5.853 29.0 Atlanta 0.788 13.8

San Diego 0.798 24.2 Tampa 0.399 13.4

Houston 1.578 23.7 Denver 0.346 12.3

Washington, D.C. 1.397 22.9 Minneapolis 0.374 10.6

Riverside 0.983 21.9 Philadelphia 0.637 10.5

Boston 0.874 18.3 Detroit 0.409 9.5

Dallas-Ft Worth 1.293 18.2 St. Louis 0.129 4.6

Source: U.S. Census Bureau, American Community Survey, 2015

RACE/ETHNICTY COMPOSITION, 20 MOST POPULOUS U.S. METROS Metro White Black Asian Hispanic1 Other Atlanta 48.3 33.1 5.5 10.6 2.5 Boston 71.7 7.4 7.6 10.6 2.7 Chicago 53.3 16.5 6.3 21.9 2.0 Dallas-Ft Worth 47.7 15.2 6.3 28.4 2.4 Denver 64.5 5.3 3.8 22.9 3.5 Detroit 66.8 22.3 4.1 4.3 2.5 Houston 37.3 16.9 7.5 36.5 1.8 Los Angeles 29.9 6.5 15.5 45.1 3.0 Miami 31.8 20.4 2.4 43.8 1.6 Minneapolis 76.6 7.8 6.4 5.7 3.5 New York 46.9 15.7 10.9 24.1 2.4 Philadelphia 62.6 20.1 5.8 9.0 2.5 Phoenix 56.5 5.1 3.7 30.4 4.3 Riverside 33.4 6.9 6.5 49.9 3.3 San Diego 46.0 4.9 11.5 33.4 4.2 San Francisco 40.4 7.3 25.2 21.9 5.2 Seattle 64.9 5.5 12.6 9.8 7.2 St. Louis 74.2 18.1 2.5 2.9 2.3 Tampa 64.4 11.4 3.3 18.2 2.7 Washington, D.C. 46.1 24.8 10.0 15.2 3.9 (1) Hispanics are of any race. All other categories include only non-Hispanics. Source: U.S. Census Bureau, American Community Survey, 2015

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 5

Travel to Work: Though Houstonians complain about wasting time in traffic, their journey to

work is not much longer than that of Houston’s peers. Among the nation’s 20 largest metro

areas, the average commute is 29.6 minutes. In Houston, the work commute is 30.2

minutes―only 36 seconds more. A few additional observations: Drop New York from the

top 20 and commute times in the nation’s major metro areas differ by only nine minutes.

Though Atlanta has a highly touted rail and bus system, public transit handles only 3.1 per-

cent of all work commutes in the region. Though Minneapolis experiences 60-70 inches of

snow in a typical winter, the weather doesn’t seem to cause many delays. The region has one

of the shortest average commute times among the nation’s 20 largest metro areas.

Health Insurance: Houston ranks last in the share of population covered by health insurance.

Only 62.8 percent of local residents have private coverage and 26.5 have public coverage,

leaving nearly 1.2 million Houstonians uninsured. Los Angeles and New York, with popula-

tions two and three times larger than Houston, have larger uninsured populations, 1.4 and 1.7

million respectively, but not that much larger than Houston’s. Dallas, with 450,000 more res-

idents than Houston, has only 7,000 more uninsured. Treating the uninsured becomes a bur-

den on others, with the costs absorbed by providers as charity care, passed on to the insured

via higher insurance premiums, or paid by property owners and through higher ad valorem

taxes.

Industrial Leasing Update — Construction activity in Houston’s industrial market fell

sharply in Q3/16 as delivery of several large facilities emptied the project pipeline. The

amount of industrial space under construction fell to 7.6 million square feet (msf), a 44 per-

cent drop from the 13.6 msf under construction in Q3/15, according to research firm New-

mark Grubb Knight Frank. Nearly all of that is being developed as warehouse and distribu-

tion space, with only 130,000 square feet intended for manufacturing.

The delivery of the Daikin/Goodman manufacturing and distribution facility, a massive new

heating/ventilation/air conditioning (HVAC) plant in Northwest Houston, helped boost ab-

sorption in the third quarter. The facility, covering an area the size of 70 football fields, is the

COMMUTING TO WORK, 20 MOST POPULOUS METRO AREAS, 2015

Metro Avg. Travel Time

to Work - Minutes % Workers Using

Public Transit Metro

Avg. Travel Time to Work - Minutes

% Workers Using Public Transit

New York 36.3 31.5 Philadelphia 29.6 9.7

Washington, D.C. 34.4 14.4 Miami 29.1 3.8

San Francisco 33.2 17.2 Dallas-Ft Worth 28.1 1.5

Riverside 31.9 1.5 Denver 27.7 4.0

Chicago 31.8 12.0 Tampa 27.0 1.4

Boston 31.4 13.6 Detroit 26.6 1.2

Atlanta 31.3 3.1 Phoenix 26.2 2.2

Houston 30.2 2.2 San Diego 26.1 3.5

Seattle 30.2 9.3 St. Louis 25.6 2.6

Los Angeles 30.0 5.1 Minneapolis 25.4 4.7

Source: U.S. Census Bureau, American Community Survey, 2015

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 6

world’s largest concrete tilt-wall building. Daikin/Goodman accounted for more than two-

thirds of the 5.8 msf that was absorbed in Houston in Q3, according to JLL.

Year-to-date net ab-

sorption in Houston

stands at 5.3 msf.2

The Daikin project

boosted the North-

west submarket,

which has a year-to-

date net absorption

of 4.3 msf, the highest among all Houston area submarkets. The Southeast submarket has ab-

sorbed 1.2 msf so far this year and accounts for 4.4 msf of the industrial space currently un-

der construction. At the other end of the spectrum, year-to-date absorption is negative for the

Southwest submarket and the Central Business District, which have struggled to overcome

losses in oil and gas related manufacturing. Year-to-date absorption in the Central Business

District has fallen to negative 750,000 sf, according to JLL.

The overall vacancy rate in the Houston industrial market rose to 5.5 percent in Q3, an in-

crease from 4.6 percent in Q3/15, according to Newmark Grubb Knight Frank. Unless de-

mand picks up, the vacancy rate will inch up in the coming months. Less than half of the 7.6

msf under construction is pre-leased.

“Tenant activity in the market is being dominated by a variety of industries including con-

sumer goods, building materials, logistics and plastics,” JLL noted in its most recent market

report. “Conversely, the manufacturing sector remains soft across the metro, but it is getting a

lift from the downstream sector, somewhat offsetting its losses from upstream.”

Average asking rents fell from $6.98 per square foot per year in Q3/15 to $6.87 in Q3/16, a

1.6 percent decline, according to Colliers.

Employment Outlook Brightens — The Houston metro area added 14,500 jobs in Septem-

ber, according to the Texas Workforce Commission (TWC). While the reported job growth is

a bit above historic patterns, it’s not substantially higher. Over the past 25 years, September

job gains have ranged from 5,000 to 18,000, averaging 10,000. The average of the past five

years is 13,100. In the 12 months ending September ’16, the region has created 20,100 jobs.

The data suggest that the low point of the current downturn occurred May ’16, when the re-

gion’s 12-month gain was just 3,200 jobs. Not once in the recent downturn has the 12-month

change been negative.

2 JLL reports Houston’s industrial absorption of 64,635 feet in Q1 and negative absorption of 623,318 square feet in Q2.

HOUSTON INDUSTRIAL MARKET OVERVIEW – Q3/16

Inventory

(MSF) Vacancy Rate (%)

Under Con-struction

(MSF)

Net Absorption

(MSF)

Avg Rent- (sf/yr)

Newmark Grubb 529.8 5.5 7.6 5.6 $6.84

CBRE 503.2 5.3 7.5 4.8 $8.40

JLL 416.5 5.5 7.2 5.8 $6.28

Transwestern 485.6 6.0 8.0 5.9 -

Colliers - 5.5 7.4 6.3 $6.87

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 7

The bulk of the September growth (18,800 jobs) occurred in local public education, a subsec-

tor of local government. Over the past 10 years, local education has added an average of

16,500 jobs in the month. Given Houston’s recent population growth and the current stage of

the business cycle—public education always lags every other sector by a year or two—

September’s robust job growth is not surprising.

Houston benefited from the 1,600 jobs added in health care in September. That sector contin-

ues to generate employment opportunities. As long as people continue to move here, have

babies here, and grow old here, that sector should continue to add jobs. Construction also

added 1,600 jobs in September, but growth in the sector will taper off in the coming months

as the office, multi-family and chemical plant construction booms wind down.

The loss of only 300 jobs in manufacturing, a sector that cut 2,000 to 3,000 jobs a month in

’15 and early ’16, suggests the worst may be over for manufacturing. Job losses in wholesale,

retail trade, finance, insurance, real estate, and other services partly offset gains in the other

sectors. Retail always loses jobs in September before adding them back in October, Novem-

ber and December. The weakness in wholesale is symptomatic of the weakness in the energy

sector and energy-related manufacturing. The drop in finance employment is part of ongoing

restructuring as the industry tries to remain profitable in a low-interest environment.

The losses in accommodation and food services are no surprise. Like retail, the sector always

loses jobs in September before adding them back over the remainder of the year. A common

misconception is that TWC’s employment data reflect full-time/40-hour-a-week jobs. In real-

ity, the data only reflect individuals on payroll, whether they work 20, 40 or 60 hours in a

-150

-100

-50

0

50

100

150

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17

Job

s (0

00

s)

Source: Texas Workforce Commission

12-Month Change in Payroll Employment, Metro Houston

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 8

0

500

1000

1500

2000

Jun'14

Dec'14

Jun'15

Dec'15

Jun'16

Dec'16

Wo

rkin

g R

igs

Source: Baker Hughes

U.S. Rig Count

week. The employment loss in accommodation and food services may reflect the departure of

part-time help, primarily high school and college students, who leave the payroll when they

return to school in the fall.

Energy Update —West Texas Intermediate, the U.S. benchmark for light sweet crude,

opened the year at $36.81, fell to $26.19 in February, and the last day of October closed at

$46.75.

The improvement in oil prices began before OPEC made its September announcement that

the cartel had reached a tentative agreement to curtail production. Details of the final agree-

ment are to be revealed at OPEC’s November 30 meeting. However, industry watchers re-

main skeptical that an agreement will be reached by then. Iran, Iraq, Libya, Nigeria and

Venezuela believe they should be exempt from any quotas. That would leave the bulk of the

cuts to come from a handful of countries—Saudi Arabia, Kuwait, U.A.E. and Qatar. This

growing uncertainty has caused WTI to slip from its mid-October high of $51.59.

The U.S. rig count hit 557 the last

week of October, up 153 rigs from

the May trough of 404. About half

the rigs (75), have been added in

the Permian Basin. Only two have

been added in the Eagle Ford. Six-

teen have been added in Oklahoma

and 11 in Pennsylvania. Unfortu-

nately, the bump in the rig count

has not been enough to have an im-

pact on energy-related employment

in Houston.

Through the first nine months of this year, the industry has drilled 8,036 onshore wells,

down from 16,248 wells drilled in the first nine months of ’15, and 30,278 drilled in the

same period in ’14. Despite the drop in exploration activity, U.S. production has averaged

8.4 million barrels a day this year, down only slightly from 8.9 million in ’15 and still mar-

ginally above 8.3 million in ’14. More efficient drilling and fracking techniques, better un-

derstanding of geology associated with shale oil, and steep cost concessions by the oil field

service firms have helped to minimize U.S. production declines.

Perhaps the biggest energy-related development in October was the announcement that GE

would combined its oil and gas operations with Baker Hughes, creating what would be the

world’s second largest oil field services company, behind Schlumberger and ahead of Halli-

burton. The deal is subject to approval from shareholders and regulatory authorities. The im-

pact on energy-related employment in Houston likely won’t be seen until late next year.

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 9

SNAPSHOT — KEY ECONOMIC INDICATORS

Aviation — The Houston Airport System handled 40.8 million passengers through Septem-

ber of this year, down 0.2 percent from the 40.9 million during the same period in ’15. Do-

mestic passengers totaled 32.0 million, down 2.9 percent from 32.9 million YTD in ’15. In-

ternational passengers totaled 8.8 million, up 10.5 percent from the 8.0 million YTD in ’15.

Building Permits — City of Houston building permits totaled $5.3 billion for the first nine

months of ’16, down 12.8 percent from $6.1 billion in the same period last year, according to

the City’s Department of Public Works & Engineering Planning & Development Services.

Inflation — The cost of consumer goods and services as measured by the Consumer Price

Index for All Urban Consumers (CPI-U) rose 1.5 percent nationwide from September ’15 to

September ’16, according to the U.S. Bureau of Labor Statistics. Core inflation (all items

less the volatile food and energy categories) increased 2.2 percent since September ’15.

Home Sales — Houston-area single-family home sales were nearly unchanged from one

year ago, falling 0.5 percent from 6,685 homes in September ’15 to 6,652 in September ’16,

according to the Houston Association of Realtors®. Year to date, single-family home sales

total 58,087, up 1.3 percent from 57,333 sales during the same period in ’15.

Vehicle Sales — Houston-area auto dealers sold 23,200 vehicles in September, a 40.4 per-

cent decrease from the 38,922 sold in September ’15, according to TexAuto Facts, published

by InfoNation, Inc. of Sugar Land. September marks the ninth consecutive month of over-

the-year declines in vehicle sales. InfoNation expects monthly sales for the remainder of the

year to fall between 22,000 and 25,000 units. The firm forecasts total sales in ’16 of approx-

imately 300,000 units, down from the 376,481 sold in ’15.

Purchasing Managers Index — The Houston Purchasing Managers Index (PMI), a short-

term leading indicator for regional production, registered 48.5 in September, up from 46.1 in

August, according to the latest report from the Institute for Supply Management-Houston

(ISM-Houston). Although the PMI continues to show economic contraction, the September

reading is the highest since July ’15.

Sales Tax Collections — City of Houston sales tax collections totaled $525.9 million

through October, down 4.3 percent from $549.4 million from the same period last year.

Patrick Jankowski, Josh Pherigo, and Jenny Philip

contributed to this issue of Houston: The Economy at a Glance

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 10

STAY UP TO DATE!

To access past issues of Economy at a Glance, please click here.

If you are a not a member of the Greater Houston Partnership and would like to subscribe to

Economy at a Glance, please click here and enter your email address. For information about

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HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 11

HOUSTON MSA NONFARM PAYROLL EMPLOYMENT (000) Change from % Change from

Sep '16 Aug '16 Sep '15 Aug '16 Sep '15 Aug '16 Sep '15

Total Nonfarm Payroll Jobs 3,006.2 2,991.7 2,986.1 14.5 20.1 0.5 0.7

Total Private 2,617.1 2,623.4 2,605.2 -6.3 11.9 -0.2 0.5

Goods Producing 533.8 532.3 555.9 1.5 -22.1 0.3 -4.0

Service Providing 2,472.4 2,459.4 2,430.2 13.0 42.2 0.5 1.7

Private Service Providing 2,083.3 2,091.1 2,049.3 -7.8 34.0 -0.4 1.7

Mining and Logging 87.3 87.1 97.1 0.2 -9.8 0.2 -10.1

Oil & Gas Extraction 49.7 50.4 52.3 -0.7 -2.6 -1.4 -5.0

Support Activities for Mining 36.3 36.6 43.4 -0.3 -7.1 -0.8 -16.4

Construction 216.5 214.9 218.4 1.6 -1.9 0.7 -0.9

Manufacturing 230.0 230.3 240.4 -0.3 -10.4 -0.1 -4.3

Durable Goods Manufacturing 145.5 145.3 159.2 0.2 -13.7 0.1 -8.6

Nondurable Goods Manufacturing 84.5 85.0 81.2 -0.5 3.3 -0.6 4.1

Wholesale Trade 168.6 169.7 172.6 -1.1 -4.0 -0.6 -2.3

Retail Trade 310.1 311.6 300.8 -1.5 9.3 -0.5 3.1

Transportation, Warehousing and Utilities 138.9 138.8 138.1 0.1 0.8 0.1 0.6

Utilities 16.2 16.1 16.0 0.1 0.2 0.6 1.3

Air Transportation 21.9 21.9 21.6 0.0 0.3 0.0 1.4

Truck Transportation 25.3 25.3 25.7 0.0 -0.4 0.0 -1.6

Pipeline Transportation 10.9 10.8 10.7 0.1 0.2 0.9 1.9

Information 30.4 30.8 32.1 -0.4 -1.7 -1.3 -5.3

Telecommunications 13.7 13.9 14.2 -0.2 -0.5 -1.4 -3.5

Finance & Insurance 96.8 98.2 95.9 -1.4 0.9 -1.4 0.9

Real Estate & Rental and Leasing 55.4 56.9 55.9 -1.5 -0.5 -2.6 -0.9

Professional & Business Services 464.1 464.0 471.1 0.1 -7.0 0.0 -1.5

Professional, Scientific & Technical Services 215.7 215.2 218.0 0.5 -2.3 0.2 -1.1

Legal Services 24.5 24.7 24.5 -0.2 0.0 -0.8 0.0

Accounting, Tax Preparation, Bookkeeping 24.3 23.9 22.6 0.4 1.7 1.7 7.5

Architectural, Engineering & Related Services 66.1 66.0 71.2 0.1 -5.1 0.2 -7.2

Computer Systems Design & Related Services 32.8 32.6 33.1 0.2 -0.3 0.6 -0.9

Admin & Support/Waste Mgt & Remediation 213.3 213.8 216.3 -0.5 -3.0 -0.2 -1.4

Administrative & Support Services 201.2 201.7 204.6 -0.5 -3.4 -0.2 -1.7

Employment Services 77.0 78.6 79.0 -1.6 -2.0 -2.0 -2.5

Educational Services 59.0 57.7 56.6 1.3 2.4 2.3 4.2

Health Care & Social Assistance 329.1 327.5 315.5 1.6 13.6 0.5 4.3

Arts, Entertainment & Recreation 34.4 36.4 32.7 -2.0 1.7 -5.5 5.2

Accommodation & Food Services 289.8 291.0 270.8 -1.2 19.0 -0.4 7.0

Other Services 106.7 108.5 107.2 -1.8 -0.5 -1.7 -0.5

Government 389.1 368.3 380.9 20.8 8.2 5.6 2.2

Federal Government 28.4 28.3 27.6 0.1 0.8 0.4 2.9

State Government 73.4 71.2 72.5 2.2 0.9 3.1 1.2

State Government Educational Services 40.2 38.0 39.6 2.2 0.6 5.8 1.5

Local Government 287.3 268.8 280.8 18.5 6.5 6.9 2.3

Local Government Educational Services 201.1 182.3 195.7 18.8 5.4 10.3 2.8

SOURCE: Texas Workforce Commission

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 12

Houston Economic Indicators

A Service of the Greater Houston Partnership

Most Year % Most Year %

Month Recent Earlier Change Recent Earlier Change

ENERGY

U.S. Active Rotary Rigs Sep '16 509 848 -40.0 487 * 1,059 * -54.0

Spot Crude Oil Price ($/bbl, West Texas Intermediate) Sep '16 45.18 45.48 -0.7 41.15 * 50.93 * -19.2

Spot Natural Gas ($/MMBtu, Henry Hub) Sep '16 2.99 2.66 12.4 2.34 * 2.80 * -16.4

UTILITIES AND PRODUCTION

Houston Purchasing Managers Index Sep '16 48.5 47.6 1.9 45.3 * 46.9 * -3.4

Nonresidential Electric Current Sales (Mwh, CNP Service Area) Sep '16 5,108,114 4,754,992 7.4 43,312,209 42,094,239 2.9

CONSTRUCTION

Total Building Contracts ($, Houston MSA) Sep '16 1,477,966,000 1,937,630,000 -23.7 11,358,202,000 14,096,061,000 -19.4

Nonresidential Sep '16 806,845,000 1,097,363,000 -26.5 4,662,595,000 5,894,257,000 -20.9

Residential Sep '16 671,121,000 840,267,000 -20.1 6,695,607,000 8,201,804,000 -18.4

Building Permits ($, City of Houston) Sep '16 440,642,919 598,438,344 -26.4 5,280,969,429 6,057,690,646 -12.8

Nonresidential Sep '16 326,289,022 435,474,161 -25.1 3,571,514,206 3,916,668,594 -8.8

New Nonresidential Sep '16 81,410,015 164,473,093 -50.5 1,407,786,853 1,951,598,300 -27.9

Nonresidential Additions/Alterations/Conversions Sep '16 244,879,007 271,001,068 -9.6 2,163,727,353 1,965,070,294 10.1

Residential Sep '16 114,353,897 162,964,183 -29.8 1,709,455,223 2,141,022,052 -20.2

New Residential Sep '16 94,256,088 140,873,854 -33.1 1,305,061,633 1,921,471,934 -32.1

Residential Additions/Alterations/Conversions Sep '16 20,097,809 22,090,329 -9.0 404,393,590 219,550,118 84.2

Multiple Listing Service (MLS) Activity

Property Sales Sep '16 7,893 8,024 -1.6 69,489 69,078 0.6

Median Sales Price - SF Detached Sep '16 219,990 210,000 4.8 219,226 * 211,872 * 3.5

Active Listings Sep '16 37,955 34,020 11.6 35,480 * 30,785 * 15.3

EMPLOYMENT (Houston-Sugar Land-Baytown MSA)

Nonfarm Payroll Employment Sep '16 3,006,200 2,986,100 0.7 2,991,689 * 2,980,122 * 0.4

Goods Producing (Natural Resources/Mining/Const/Mfg) Sep '16 533,800 555,900 -4.0 539,122 0 567,733 * -5.0

Service Providing Sep '16 2,472,400 2,430,200 1.7 2,452,567 0 2,412,389 * 1.7

Unemployment Rate (%) - Not Seasonally Adjusted

Houston-Sugar Land-Baytown MSA Sep '16 5.7 4.8 5.2 * 4.6 *

Texas Sep '16 4.9 4.5 4.6 * 4.5 *

U.S. Sep '16 4.8 4.9 5.0 * 5.5 *

TRANSPORTATION

Port of Houston Authority Shipments (Short Tons) Sep '16 3,992,992 3,404,971 17.3 33,918,671 35,135,428 -3.5

Air Passengers (Houston Airport System) Aug '16 4,605,137 4,789,130 -3.8 36,714,840 36,771,039 -0.2

Domestic Passengers Aug '16 3,569,747 3,782,749 -5.6 28,662,150 29,479,777 -2.8

International Passengers Aug '16 1,035,390 1,006,381 2.9 8,052,690 7,291,262 10.4

Landings and Takeoffs Aug '16 68,268 67,499 1.1 525,101 536,245 -2.1

Air Freight (metric tons) Aug '16 33,147 32,350 2.5 266,409 275,328 -3.2

Enplaned Aug '16 15,673 16,776 -6.6 129,215 143,171 -9.7

Deplaned Aug '16 17,475 15,574 12.2 137,194 132,157 3.8

CONSUMERS

New Car and Truck Sales (Units, Houston MSA) Sep '16 23,200 38,922 -40.4 227,507 294,076 -22.6

Cars Sep '16 8,634 15,612 -44.7 83,038 119,855 -30.7

Trucks, SUVs and Commercials Sep '16 14,566 23,310 -37.5 144,469 174,221 -17.1

Total Retail Sales ($000,000, Houston MSA, NAICS Basis) Q4/15 31,941 35,393 -9.8 112,143 125,047 -10.3

Consumer Price Index for All Urban Consumers ('82-'84=100)

Houston-Galveston-Brazoria CMSA Sep '16 216.573 214.652 0.9 215.747 * 212.662 * 1.5

United States Sep '16 241.428 237.945 1.5 239.514 * 236.945 * 1.1

Hotel Performance (Houston MSA)

Occupancy (%) Q2/16 66.2 71.1 65.9 * 70.6 *

Average Room Rate ($) Q2/16 110.75 112.10 -1.2 107.96 * 108.09 * -0.1

Revenue Per Available Room ($) Q2/16 73.29 79.70 -8.0 71.07 * 76.28 * -6.8

YEAR-TO-DATE TOTAL or

YTD AVERAGE*MONTHLY DATA

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 13

Sources Rig Count Baker Hughes Incorporated Spot WTI, Spot Natural Gas U.S. Energy Information Admin. Houston Purchasing Managers National Association of Index Purchasing Management – Houston, Inc. Electricity CenterPoint Energy Building Construction Contracts McGraw-Hill Construction City of Houston Building Permits Building Permit Department, City of Houston

MLS Data Houston Association of Realtors Employment, Unemployment Texas Workforce Commission

Port Shipments Port of Houston Authority Aviation Aviation Department, City of Houston Car and Truck Sales TexAuto Facts Report, InfoNation, Inc.,

Sugar Land TX Retail Sales Texas Comptroller’s Office Consumer Price Index U.S. Bureau of Labor Statistics Hotels PKF Consulting/HospitalityAsset Advisors International Postings, Foreclosures Foreclosure Information &Listing Service

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 14

3

4

5

6

7

8

9

10

11

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

% C

ivili

an L

abo

r Fo

rce

Source: Texas Workforce Commission

Unemployment Rate - Houston, Texas and U.S.

Houston Texas U.S.

3

4

5

6

7

8

9

10

11

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

% C

ivili

an L

abo

r Fo

rce

Source: Texas Workforce Commission

Unemployment Rate - Houston, Texas and U.S.

Houston Texas U.S.

1,800

1,900

2,000

2,100

2,200

2,300

2,400

2,500

420

460

500

540

580

620

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

Serv

ice

-Pro

vid

ing

Job

s (0

00

s)

Go

od

s-P

rod

uci

ng

Job

s (0

00

s)

Source: Texas Workforce Commission

Goods-Producing and Service-Providing EmploymentHouston MSA

Goods-Producing Jobs Service-Providing Jobs

HOUSTON—THE ECONOMY AT A GLANCE

November 2016 ©2016, Greater Houston Partnership Page 15

30

35

40

45

50

55

60

65

70

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

Source: Institute for Supply Management-Houston

Houston Purchasing Managers Index50 = Neutral

Co

ntr

acti

on

Exp

ansi

on

0

2

4

6

8

10

12

14

16

0

20

40

60

80

100

120

140

160

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

Nat

ura

l Gas

, $ /

MM

Btu

WTI

, $ b

arre

l

Source: U.S. Energy Information Administration

Spot Crude and Natural Gas PricesMonthly Averages

WTI Natural Gas