Whether you’re an executive at a Houston business in need of a recruitment strategy or a candidate looking for a job, it’s important to understand the realities facing your industry. Here we’ve gathered the most recent news and predictions for hiring and employment in Houston:
The Houston metro area is showing signs of renewal after the prolonged economic downturn following the 2014 oil-industry bust. With energy sector companies among the largest employers in the region, Houston was hit hard by the steep drop in oil prices and decreased production. Between December 2014 and October 2016, the Houston metro area lost 30,400 manufacturing jobs, 25,600 mining and logging jobs, and 10,700 engineering services jobs.
But the region’s economy is showing signs of growth. Crude oil prices rose from $26 per barrel in February 2016 to $50 per barrel in December 2016. Oil drilling rig activity is rising across the U.S. with 593 active rigs in November 2016, up from 404 operational rigs in May 2016. A slow yet steady recovery is forecast for Houston’s economy, provided oil prices continue to rise moderately and they don’t experience another price drop.1
Houston’s employment expanded by .5 percent, or 14,800 jobs, over the course of 2016. Unemployment in Houston was 4.8 percent in December 2016, rising from 4.2 percent in December 2015, but close to the 4.7 percent national unemployment rate.2
Medical Research and Biotech Expand in Houston
The Texas Medical Center, one of Houston’s largest employers, is undergoing a massive $650 million expansion set to be complete in 2018. The new facility will grow from 2.5 to 3.8 million square feet and include a new trauma institute and burn center. The Texas Medical Center Innovation Institute, an incubator for biotech startups, is also expecting to expand.3 Johnson & Johnson Innovation JLABS also opened a major incubator for biotechnology and life science businesses in March 2016, helping further position Houston as a globally competitive bioscience hub.4
Growth in the Service and Tourism Industries
Houston’s economy weathered the oil bust slightly better than expected because many of the lost energy sector jobs were replaced with jobs in expanding sectors, such as retail and healthcare. Hotels, restaurants and bars added 27,500 jobs to the region between December 2014 and October 2016. Although these gains significantly offset lost oil industry jobs, many of these positions are lower paying than the energy sector positions they replaced.5
Houston’s employment expanded by .5 percent, or 14,800 jobs, over the course of 2016. Unemployment in Houston was 4.8 percent in December 2016, rising from 4.2 percent in December 2015, but close to the 4.7 percent national unemployment rate.6
Despite the marginal job growth, the Houston area is experiencing one of the largest increases in population in the nation. This population expansion is helping fuel the growth in the service industries.7 Retailers such as 365, Whole Foods’ low-cost supermarket, and sporting goods company Field & Stream, are opening locations in the region in 2017. The Greater Houston Partnership, an organization of local business leaders supporting the region’s growth, predicts the retail industry will add 4,500 jobs over the course of the year.8
As the recent host of Super Bowl LI, Houston’s established appeal as a tourist destination is showing signs of further growth. A building boom of hotels will add 3,000 rooms to the city in 2017. Together, the hospitality and food services industries are forecast to add 8,700 jobs this year.9
Houston-area Housing Market:
In the third quarter of 2016, Houston was second in the nation only to Dallas in new home construction. House sales have remained strong for the past two years, despite the downturn. The inventory is tight and the number of foreclosure sales has dropped dramatically since the start of the Great Recession. Homes priced above $500,000 are selling slowly, however, and growth in home values has slowed.9 Supply has outstripped demand in the Houston rental market, leading to a 2-to-6-percent drop in 2016 rental prices.10
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1 Jankowski, Patrick. “2017 Houston Employment Forecast.” Greater Houston Partnership. Web December 2016, accessed 13 Feb 2017.
2 DePillis, Lydia. “2016 Ends with Marginal Job Growth in Houston.” Houston Chronicle. Web 20 Jan 2017, accessed 13 Feb 2017.
3 Metro Economic Outlook: Houston. Society for Human Resource Management. Web 1 Jan 2017, accessed 13 Feb 2017.
4 Deam, Jenny. “Texas is Growing Into a National Bioscience Power.” Houston Chronicle. Web 7 June 2016, accessed 13 Feb 2017.
5 Jankowski, Patrick. “2017 Houston Employment Forecast.” Greater Houston Partnership. Web December 2016, Accessed 13 Feb 2017.
6 DePillis, Lydia. “2016 Ends with Marginal Job Growth in Houston.” Houston Chronicle. Web 20 Jan 2017, accessed 13 Feb 2017.
7 Metro Economic Outlook: Houston. Society for Human Resource Management. Web 1 Jan 2017, accessed 13 Feb 2017.
8 Jankowski, Patrick. “2017 Houston Employment Forecast.” Greater Houston Partnership. Web December 2016, Accessed 13 Feb 2017.