Here's where the Greater Houston Partnership projects employment growth and decline in 2018

Population growth analysts project 500,000-800,000 people will be added to Houstonu2019s population between 2017 and 2022.

Population growth analysts project 500,000-800,000 people will be added to Houstonu2019s population between 2017 and 2022.

While the Greater Houston area's population grew by 852,000 people from 2010 to 2016, some of the nation’s other largest metropolitan areas—New York, Los Angeles, Philadelphia and Chicago—experienced a net loss of people, or saw more people moving out than moving in, according to Jenny Philip, a research director for the Greater Houston Partnership.

Population growth experts project 500,000-800,000 people will be added to Houston’s population between 2017 and 2022, Philip said Tuesday at a Cy-Fair Houston Chamber of Commerce luncheon.

The GHP projects employment growth in every industry sector except two—construction and information—from December 2017 to December 2018. Although Houston added 62,900 jobs in 2017, roughly 30,000 of them were created as a part of the Hurricane Harvey recovery process, including many construction jobs, and are not expected to last through the next year.

Philip said Houston should add about 45,500 jobs throughout 2018.

“Because energy is going to remain flat for quite some time, and that is the main economic driver for the Houston area, population growth is what will continue to spur employment growth and activity in population-based industries like health care and education,” Philip said.

At the same time, economic opportunity leads to population growth, and for Houston, that opportunity depends heavily on the energy industry, she said.

Energy recovery

The oil and gas industry is anticipated to continue recovering in 2018 with the price of oil hovering between $55-$60 per barrel. This is the level where capital investment and rig counts typically increase, Philip said.

However, Houston’s rig count has plateaued at around 1,000 because the industry has advanced to the point where oil and gas production has increased with fewer employees, Philip said.

“As we were going through this downturn, we saw so much advancement in technology and the way that we were producing... with less capital needed, less human employment needed,” she said.

Exploration and production companies such as Chevron, BP, Exxon and Shell are affected less than oilfield services companies like Halliburton and Schlumberger, which are more likely to cut or add jobs based on the price of oil, Philip said.

Overall, energy employment is up 20 percent, capital expenditures are up 50 percent and oil production is up 60 percent since the downturn.

Construction boom

After Harvey, the construction industry saw a massive increase in jobs after a period of net loss in that area, but Philip said this bump is only temporary.

“What we're seeing is this momentary spike in construction employment, which will likely be slowing down [in mid-2018], and then by the time December rolls around, we’ll probably be at a net loss in terms of construction employment in the Houston area,” she said.

Permit values in the residential sector—primarily renovations and additions being made in the midst of hurricane recovery—also had a slight uptick toward the end of 2017. From September to December, those values increased by 170 percent from the previous year, Philip said.

Health care employment

Houston added 50,000 health care jobs over five years, which helped offset the most recent oil and gas downturn, Philip said.

“Unfortunately, we aren’t able to maintain that level of growth and we’re actually experiencing one of the first net declines in employment at the end of 2017,” she said.

Ambulatory care centers drove much of the industry’s growth in recent years, but Philip said the growth was more than what was necessary. Now, Houston is in a period of “right-sizing,” she said, adding that the decline can be seen at the national level as well.

“There are a lot of systemic issues that we need to deal with in health care in terms of insurance, in terms of pharmaceutical costs, and a lot of that may need to just be addressed on the policy side before we’ll see overall growth,” she said.


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