Employment Outlook: Houston
August 17, 2022
By Mary Anne Thompson, Founder and President, GoinGlobal, Inc.
One of the largest cities in the US, Houston, Texas, is experiencing economic and population growth and hiring across multiple job sectors.
Houston is the US’s fourth-largest city and the largest city in the US Southwest, with a population of 2.3 million. As the ‘Energy Capital of the World,’ it employs nearly a third of the nation’s jobs in oil and gas extraction; therefore, the region’s financial health hinges on the price of oil and gas. The city is the key center for the international oil and gas exploration and production industry and for many of the nation’s largest international engineering and construction firms.
The region’s employment has returned to pre-pandemic levels, and the metro area added 159,700 jobs over the last year.
The Houston-Woodlands-Sugar Land Metropolitan Statistical Area (MSA) consists of nine counties: Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller. Residents enjoy the advantages of a temperate climate, no state income tax and relatively low cost of housing. The region has the second-lowest overall cost of living among the nation’s 20 most populous metropolitan areas.
Its population is growing. The metro area’s population stands at more than 7.1 million. According to the Greater Houston Partnership, the region will have more than 10 million residents by 2040.
Houston is regarded as the nation’s most diverse region. Its residents speak more than 145 different languages and nearly one in four was born outside the US. There are more than 1.64 million foreign-born people in the metro area, and of those, 71.8% entered the US before 2010. Among the foreign-born population, about 62.4% are from Latin America, 25.5% from Asia, 6.9% from Africa and 4.0% from Europe. The remainder comes from other parts of the world.
Key Industries
Houston is world renowned for its aerospace and health care innovations. In addition, the city has strong construction, education, international trade and technology industries. With its massive port and brisk international trade, the city is an economic juggernaut.
As the nation’s leading domestic and international center for virtually every segment of the energy industry, it derives nearly 8% of its total employment from the energy sector.
Twenty-four companies headquartered in Metro Houston are on the Fortune 500 list, ranking the region third nationwide in Fortune 500 companies. Metro Houston is also home to 43 Fortune 1000 companies. The top five local Fortune 500 companies are:
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Phillips 66
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Sysco
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ConocoPhillips
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Plains GP Holdings
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Enterprise Products Partners
The largest employers in Houston:
(More than 20,000 employees)
H-E-B
Houston Methodist
Memorial Hermann Health System
UT MD Anderson Cancer Center
Walmart
(10,000 to 19,999 employees)
ExxonMobil
HCA Houston Healthcare
Kroger
Landry’s
Schlumberger
Shell Oil Co.
Texas Children’s Hospital
United Airlines
UT Health Science Center
UT Medical Branch Health System
Wood Group
Areas of Job Promise
Metro Houston’s workforce has grown to more than 3.26 million workers, after losing more than 350,000 jobs during the pandemic shutdown. The current unemployment rate in Houston is at 4.3%, higher than the national average.
The metro area gained 169,700 jobs over the last year, or 5.6%, compared to the national increase of 4.6% during that period. Here are the sectors that accounted for the largest numbers of job gains over the last year:
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Trade, transportation and utilities
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Leisure and hospitality
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Education and health services
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Professional and business services
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Construction
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Manufacturing
Houston’s economy is resilient. Over the last decade, the region has bounced back from the pandemic shutdown, the Great Recession and from the worst oil recession in a generation, the 2014 to 2016 slump that caused a loss of more than 86,000 oil and gas jobs. However, growth in other sectors helped offset the job losses.
The Greater Houston Partnership predicts that the region will create more than 75,000 jobs in the coming year, with growth in every sector of the economy. It expects that the greatest gains will come in administrative support and waste management; government; health care and social assistance; and professional, scientific and technical assistance.
Salaries
Houston’s annual wage growth was in the medium range among the 15 largest metropolitan areas in the United States during the past year; wages rose by 5.2% over the last 12 months. By comparison, wages and salaries increased an average of 4.8% nationwide over the same period. The average annual salary in the metro area is 57,790 USD, according to the Bureau of Labor Statistics.
Industry Trend Highlights
Aerospace
Houston is one of NASA’s largest research and development facilities and a source of the nation’s finest high-tech professionals in science and engineering. There are 1,500 aerospace engineers in Houston, and the region is home to more than 23,000 aerospace professionals.
The aviation community includes 350 companies involved in aircraft or space vehicle manufacturing, space research and technology. The Johnson Space Center employs about 3,000 locals, many of them engineers and scientists. In addition, 50 contracting companies provide 12,000 space center workers.
Axiom Space, a commercial space station builder, is constructing a 14-acre headquarters campus at the Houston Spaceport. The project, which will include a facility to train private astronauts and establish a private space station, is expected to create more than 1,000 jobs.
Engineering
Commercial and industrial building consumes much of the Houston construction sector. The construction industry is currently responsible for 234,600 jobs, about 7% of the region’s civilian labor force. This number represents an increase of 12.8% over the last year.
The construction industry faces several post-pandemic challenges, including supply shortages, labor shortages and delivery delays. The pace of office construction has slowed as the region experiences a glut of office and retail space. However, the increased demand for e-commerce has spurred the need for additional warehouse space, and the demand for single-family housing remains steady as Houston’s population continues to grow. The Greater Houston Partnership predicts a gain of 2,700 jobs in the construction and engineering sector in the coming year.
Metro Houston has one of the highest concentrations of engineering talent in the nation, according to the Greater Houston Partnership. Architectural and engineering services account for more than 73,900 jobs in the metro area.
Energy
The metropolitan area has more than 4,650 energy-related firms, including more than 600 companies involved with oil and gas exploration and production and 1,100 oilfield service companies, according to the Greater Houston Partnership. About 25.3% of the country’s oil and gas extraction jobs, 19.5% of jobs in drilling oil and gas wells, and 12.2% of jobs in support activities in oil and gas extraction are located in the area.
Additionally, Houston’s energy industry has moved beyond fossil fuels to include alternative energy source development. The city is a significant player in the production of wind energy, solar energy and biofuels, as major oil companies look to increase investments in renewable energy technologies. It is the largest municipal buyer of renewable power in the US, sourcing 89% of the 1.2-million-kilowatt hours used per year from solar and wind energy.
Employment in the energy sector has seen major upheavals over the past several years as oil prices and the number of operating oil rigs fluctuated. The region currently has more than 227,600 jobs in the energy sector; the Greater Houston Partnership predicts that energy employment will add 4,000 jobs in the coming year.
Health Care
Houston is a good place to be a doctor – or a sick person, for that matter. The region is home to Texas Medical Center, the largest medical complex in the world. The health care and social assistance sector employs more than 376,000 in the Houston-Sugar Land-Baytown Metro Area, including more than 19,400 practicing physicians at 240 hospitals, according to the Greater Houston Partnership.
The Texas Medical Center, in particular, contributes enormously to the local economy. It consists of 63 world-renowned medical research centers and academic institutions, including five medical schools, two pharmacy schools and five nursing schools. The medical center has the largest concentration of medical and research institutions in the world. It has more than 106,000 employees, including physicians, scientists, researchers and other advanced-degree professionals in the life sciences.
Houston’s hospitals particularly need nurses. The state is facing a long-term shortage of 57,000 nurses by 2032. The coalition is currently lobbying the state for millions to fund nursing education. That funding could make this city a great place for jobseekers who want to become nurses.
Conclusion
Houston, one of the US’s largest cities, continues to grow economically, and there is expansion across multiple job sectors.