Patrick Jankowski · 2017-05-10 · 4-Qtr Moving Total, ’06 Constant $ Salaries & Wages Paid to Houston Workers. 22. The worst is over. 0 20 40 60 80 100 120 ... Brazil 3.6 0.7

Houston Economic Outlook

Patrick Jankowski

www.houston.org

Follow me on Twitter @pnjankowski

http://www.google.com/url?sa=i&source=images&cd=&cad=rja&docid=3LTVBTaCB-E50M&tbnid=TW40P_3a4vVnfM:&ved=&url=http://theinspirationroom.com/daily/2012/twitter-logo-redesigned/&ei=09ZUUqmmJojw2QXf6oGwDQ&psig=AFQjCNH_PG9_nOkpQU53Gtic-g7vziLy1Q&ust=1381378131702576

May 22

10:30 a.m.

Hilton Post Oak

5

It’s not Christmas but . . .

6

It’s not Christmas but . . .

Population Estimates

Revised Employment Data

7

Rank Metro Area Population as of 7/1/16 Change since 7/1/15

1 New York 20,153,634 35,571

2 Los Angeles 13,310,447 41,619

3 Chicago 9,512,999 (19,570)

4 Dallas-Fort Worth 7,233,323 143,435

5 Houston 6,772,470 125,005

6 Washington, D.C. 6,131,977 53,508

7 Philadelphia 6,070,500 8,197

8 Miami 6,066,387 64,670

9 Atlanta 5,789,700 90,650

10 Boston 4,794,447 27,692

Source: U.S. Census Bureau

10 Most Populous Metro Areas

8

Births 102,152

Deaths -40,536

Natural Increase 61,616

Net International1 35,000

Net Domestic +28,090

Net In-Migration 63,090

Total2 125,0051 Includes U.S. and foreign-born populations.2 Does not sum due to rounding and other effects.


Components of Growth, 7/15 – 7/16

9

Births 102,152

Deaths -40,536

Net Natural Increase 61,616

In-Migration

International 35,000

Domestic 28,090

In-Migration 63,090




10

Births 102,152

Deaths -40,536

Natural Increase 61,616

In-Migration

International 35,000

Domestic 28,090

In-Migration 63,090




11

Metro Area Net Growth

Houston 851,971

Dallas-Fort Worth 807,082

New York 587,163

Atlanta 502,975

Miami 500,089

Washington 495,561

Los Angeles 481,486

Boston 241,852

Philadelphia 104,838

Chicago 51,449

Long-Term Growth, 7/10 – 7/16

Current Metro Populations

Baton Rouge, LA = 835,175

New Haven, CT = 856,875

12

Metro Area---------- Net Migration ----------

Total International Domestic

Houston 476,857 193,618 283,239

Dallas-Fort Worth 444,944 140,476 304,468

New York -53,912 848,704 -902,616

Atlanta 257,589 104,223 153,366

Miami 374,706 381,468 -6,762

Washington 199,276 245,540 -46,264

Los Angeles -57,111 315,879 -372,990

Boston 145,718 182,201 -36,483

Philadelphia -4,729 123,139 -127,868

Chicago -260,662 148,505 -409,167


13

Metro Area Net Change Vital Events Net Migration

Houston 851,971 372,983 476,857

Dallas-Fort Worth 807,082 357,825 444,944

New York 587,163 671,717 -53,912

Atlanta 502,975 241,489 257,589

Miami 500,089 120,947 374,706

Washington 495,561 297,395 199,276

Los Angeles 481,486 554,435 -57,111

Boston 241,852 103,093 145,718

Philadelphia 104,838 115,420 -4,729

Chicago 51,449 321,530 -260,662


Vital Events = Births minus Deaths

14

Payroll Employment

91.0

21.3

-110.5

50.3

83.1

118.8

90.4

118.2

0.2

18.7

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

Houston Job Growth, Dec – Dec (000s)

Source: Texas Workforce Commission

118.2

0.2

18.7

'14 '15 '16

Houston Job Growth, Dec – Dec (000s)


SectorJobs Lost

Dec ’14 – Dec ’16 %

Exploration & Production -11,000 -18.7%

Oil Field Services -19,900 -35.6

Fabricated Metal Products -18,700 -28.2

Machinery Manufacturing 20,600 -30.4

Engineering -10,900 -14.3

Total Losses -81,100 -25.5%Source: Texas Workforce Commission

17

Energy Losses

SectorJobs Gained

Dec ’14 – Dec ’16%

Leisure & Hospitality 25,800 9.0%

Health Care 23,000 7.5

Public Education (state & local) 17,000 6.9

Retail Trade 10,900 3.5

Financial Activities 6,000 4.0

Total Gains +82,700


18

Non-Energy Gains

-80

-60

-40

-20

0

20

40

60

80

100

120

140

Jan '14 Jul '14 Jan '15 Jul '15 Jan '16 Jul '16 Jan '17 Jul '17

Job

s (

00

0s)

Source: U.S. Bureau of Labor Statistics

12-Month Running Totals

Energy Jobs Total Jobs Non-Energy Jobs

19

Metro Houston Employment

Winners $ Wages

Leisure & Hospitality $22,800

Health Care 54,800

Public Education (state & local) 47,800

Retail Trade 32,400

Financial Activities 89,100

20

Average Annual Wage


Losers $ Wages

Exploration & Production $192,000

Oil Field Services 121,000

Fabricated Metal Products 71,700

Machinery Manufacturing 95,524

Engineering 106,000

Biggest Winners and Losers

$188.4 $186.7

$100

$125

$150

$175

$200

Q1/10 Q1/11 Q1/12 Q1/13 Q1/14 Q1/15 Q1/16 Q1/17

$ B

illio

ns

Source: Quarterly Census of Employment and Wages

4-Qtr Moving Total, ’06 Constant $

Salaries & Wages Paid to Houston Workers

22

The worst is over.

0

20

40

60

80

100

120

Jun '14 Dec '14 Jun '15 Dec '15 Jun '16 Dec '16 Jun '17

$ P

er

Ba

rre

l

Source: U.S. Energy Information Administration

23

NYMEX WTI Spot Price

Feb 11, 2016 $26.19/barrel

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Jun '14 Dec '14 Jun '15 Dec '15 Jun '16 Dec '16 Jun '17

Wo

rkin

g R

igs

Source: Baker Hughes

24

U.S. Rig Count

May 27, 2016 404 Rigs

35

40

45

50

55

60

65

70

'13 '14 '15 '16 '17 '18

Above 50 = Expansion, Below 50 = Contraction

25

Purchasing Managers Index

Source: Institute for Supply Management- Houston

Regional Employment, Net Change

-20

0

20

40

60

80

100

120

140

'14 Mar May Jul Sep Nov '15 Mar May Jul Sep Nov '16 Mar May Jul Sep Nov '17 Mar May

Job

s, 0

00

s



August 2016 - 3,800 jobs

Regional Employment, Net Change

-20

0

20

40

60

80

100

120

140

'14 Mar May Jul Sep Nov '15 Mar May Jul Sep Nov '16 Mar May Jul Sep Nov '17

Job

s, 0

00

s



28

Three sectors to

cut jobs in ’17.

29

Lost Money Earned a Profit

Energy

Still restructuring

No hiring when losing money

- 3,500 jobs

30

5

10

15

20

25

30

35

$ B

illio

ns

Source: Dodge Data and Analytics

12-Month Moving Total

31

Construction Starts, Metro Area

5

10

15

20

25

30

35

$ B

illio

ns

Source: Dodge Data and Analytics

12-Month Moving Total

32

Construction Starts, Metro Area

Petrochem

Office

Industrial

Residential

Health care

Government

33

- 16,000 jobs

Construction Employment

Information

Long-term decline

continues

- 200 jobs

34

35

Where will job

growth come

from?

-100

-50

0

50

100

150

200

250

'81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13 '15

Th

ou

sa

nd

s


36

Annual Change, Houston MSA Population

2.8

0.8

3.1

4.0

-1.2

4.0

5.0

2.32.0

2.6

2.0

0.9 0.8

1.4

3.5

2.1

0.7

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17

Source: U.S. Bureau of Economic Analysis * seasonally and inflation adjusted

% Change from Preceding Quarter*

37

U.S. Gross Domestic Product

0

50

100

150

200

250

300

350

400

Jan '14 Apr '14 Jul '14 Oct '14 Jan '15 Apr '15 Jul '15 Oct '15 Jan '16 Apr '16 Jul '16 Oct '16 Jan '17 Apr '17


Jobs Added (000s)

38

U.S. Employment

Growth Forecasts, Year-Over-Year Percent Change

’16 ’17 ’18

Global Economy 3.0% 3.1% 3.3%

Advanced Economies 1.8 2.0 2.3

United States 1.6 2.0 2.3

Eurozone 1.7 1.8 2.0

United Kingdom 1.8 1.8 1.8

Japan 1.0 1.1 0.9

Korea 2.7 2.5 2.6

Developing Economies 4.2 4.1 4.3

China 6.7 6.3 5.8

India 7.8 7.0 7.0

Mexico 2.3 -1.0 1.6

Brazil 3.6 0.7 2.7

Source: Wells Fargo Securities

39

Global Growth Forecasts

Imports

$104.1 Billion

64%

Exports,

$58.1 Billion

36%

’06

40

Houston’s Foreign Trade

Imports

$69.8 Billion

43%

Exports

$93.0 Billion

57%

'16

41

Health Care

0

50

100

150

200

250

300

350

'90 91 92 93 94 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17


Jobs, 000s

42

Houston Health Care Employment

11.09.7

8.8

7.38.1

7.2 7.6

6.1 6.2

16.9

15.114.0 13.7

12.2

10.6 10.4 10.49.4

Philadelphia New York Minneapolis Los Angeles Phoenix Dallas HOUSTON Atanta Washington


'90 '15

43

Health Care as % of Total Employment

44

Health Care

+ 9,800 Jobs

45

Hotels,

Restaurants and

Bars

7,184 7,4648,023 8,082 8,353 8,677 8,950 9,342 9,619 9,939 10,217 10,627

Q2/05 Q2/06 Q2/07 Q2/08 Q2/09 Q2/10 Q2/11 Q2/12 Q2/13 Q2/14 Q2/15 Q2/16


Houston Area Bars and Restaurants

46

47

Hotels,

Restaurants and

Bars

+ 8,700 Jobs

48

Government

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

250

270

290

310

330

350

370

390

410

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15

Tota

l Em

plo

yme

nt, 0

00

,00

0s

Go

ve

rnm

en

t E

mp

loym

en

t, 0

00

s


Government Employment Metro Population

49

Metro Employment

50

Government

+ 6,200 jobs

51

Retail

-7.7

6.3

8.6

5.54.2

1.1

7.5 7.99.6

3.5

-3.7-2.7

-4.9

2.5

8.8

2.1

12.2

0.4

-7.2

6.47.6

8.47.2

4.7 4.32.9

'91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16

Source: U.S. Bureau Labor Statistics

Annual Change, 000s

52

Metro Retail Employment

53

Retail

+ 4,500 Jobs

54

Manufacturing

$8.3

$22.7

$5.0$4.0

$3.0$2.0

'16 '17 '18 '19 '20 '21

Source: Institute for Regional Forecasting

Value, Billions

55

Local Chemical Plant Completions

56

Manufacturing

+ 3,000 Jobs

9,800

8,700

6,200

4,9004,500

3,0002,400 2,400 2,200 2,100

1,100 1,100 1,000

57

’17 Metro Employment Forecast

Construction -16,000

Energy -3,500

Information -200

58

’17 Metro Employment Forecast

+ 29,700 Jobs

-8.1

17.6

44.853.2 56.8 52.7

106.292.6

18.0

60.0

1.4

-1.2-11.7

39.3

91.4106.9

91.0

21.3

-110.5

50.3

83.1

118.8

90.4

118.2

0.2

18.729.7

'91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17

December to December, (000s)

Historic Job Growth


60

Rules of Thumb, Guestimates and Theorems

61

The Yahtzee Rule for

Measuring Houston

Growth

62

Houston wins when

we roll sixes.

63

Houston wins when

we roll sixes.$60 oil

64

Houston wins when

we roll sixes.$60 oil 60,000 jobs

65

Houston wins when


60,000

relocations

66

Houston wins when


60,000

relocations 60 MPH

67

Thank you

Houston Economic OutlookPatrick Jankowski

Documents

Patrick Jankowski · 2017-05-10 · 4-Qtr Moving Total, ’06 Constant $ Salaries & Wages Paid to Houston Workers. 22. The worst is over. 0 20 40 60 80 100 120 ... Brazil 3.6 0.7