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GHP: The Economy At A Glance (August 2010)

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  • 1. A publication of the Greater Houston Partnership Volume 19, Number 8 • August 2010 Drilling Moratorium Impact — Since the Obama Administration issued its ban on deepwater drilling in the Gulf of Mexico, there have been numerous studies on the moratorium’s impact upon the energy industry and the economy. Joseph R. Mason, an economist at Louisiana State University, estimates that the Gulf states (Alabama, Mississippi, Louisiana and Texas) will lose 8,169 jobs, $2.1 billion in economic output, and $487 million in wages. Texas’ share of that loss: 2,492 jobs, $622 million in gross domestic product, and $153 million in wages. If the mora- torium lasts more than six months, the losses would at least double or triple, Mason notes. In June, Morgan Stanley released a study suggesting three different scenarios for when deepwater drilling would resume: o Bull Case: The presidential commission studying the blowout completes its re- view and makes recommendations in six months. Congress enacts new rules and regulations in the following two months. Drilling resumes soon afterward. Morgan Stanley gives this scenario a 5 percent likelihood of happening. o Bear Case: The commission takes 12 months to review safety procedures and make recommendations. Congress bogs down in debate. Two years elapse be- fore new regulations are issued. Another 12 months elapse before rigs return to the Gulf. Morgan Stanley gives this scenario a 35 percent likelihood. o Base Case: The commission completes its work in six months. Congress takes six to 12 months to pass legislation. Although some rigs have moved out of the Gulf, activity resumes soon after legislation passes. Morgan Stanley gives this scenario a 60 percent likelihood. The study also suggests the moratorium will have the greatest impact upon the sub- sea equipment makers and offshore drillers. Smaller service companies and land- focused drillers will not be affected. An IHS Global Insight study, commissioned by Houston-based Cobalt Energy, es- timates that offshore activity supports 382,250 direct, indirect and induced jobs, adds $69.8 billion to the U.S. economy, and generates $30.1 billion in wages and salaries. The independent energy firms are responsible for approximately half of that employment, wages and impact to the U.S. economy. If Congress enacts rules August 2010 ©2010, Greater Houston Partnership Page 1
  • 2. HOUSTON—THE ECONOMY AT A GLANCE so arduous that independents can no longer work offshore, their contributions to the economy would be at risk. Most studies have dealt with the moratorium’s impact at the state, national and in- dustry level. If a detailed study has been completed on Houston, the GHP research department has yet to find it. (If you have one, please share it with us.) Most im- pact figures that are cited are anecdotal or from news reports. Last week, Baker Hughes announced the drilling ban would force it to move 300 Gulf workers over- seas. In a recent meeting with the real estate firm CB Richard Ellis, several brokers noted tenants asking for short-term renewals on their leases. They were reluctant to commit to long-term contracts until the impact of the moratorium is more apparent. One study that went almost unnoticed was the Energy Information Admin- istration’s International Energy Outlook 2010. EIA noted that worldwide energy consumption, on a BTU basis, is projected to grow by 49 percent from ’07 to ’35. Worldwide demand for liquid fuels and other petroleum products will grow 29 percent, from 86.1 million barrels per day in ’07 to 110.6 million in ’35. World- wide demand for natural gas is projected to grow 44 percent, from 108 trillion cubic feet in ’07 to 156 trillion cubic feet in ’35. The United States faces tough competition for oil and gas supplies on the world market. The Gulf of Mexico ac- counts for 30 percent of the crude and 13 percent of the natural gas produced in the United States. If U.S. policy shuts down exploration and production in the Gulf, that would have dire consequences for U.S. energy supply and energy security. Employment Continues to Recover — The Texas Workforce Commission reports that the Houston-Sugar Land-Baytown Metropolitan Statistical Area creat- ed 600 net new jobs in the month of June, marking the fifth consecutive month of job gains. Though the net increase is small a look at the details suggests a som- ewhat different picture. o Sector Gains and Losses: The private sector created 13,100 jobs in June with solid gains in several sectors—leisure and hospitality (3,100 jobs); professional and business services (2,600 jobs); trade, transportation, and utilities (2,600 jobs); manufacturing (1,700 jobs) and oil and gas (1,200 jobs). These gains were offset by losses of 12,500 government jobs. Federal employment fell (- 4,200 jobs) as Census workers finish their contracts and educational em- ployment dropped (-9,200 jobs) because of teachers and support staff on 10- month contracts. The offset illustrates the challenge of working with seasonally unadjusted em- ployment data. As teachers leave school for the summer holidays their entry in- to the job market, albeit temporary, pulls down the job numbers while hotels and restaurants hiring for the vacation season lift the numbers. In the fall, the two will swap places. Leisure and hospitality employment will decline while employment in education will rise. August 2010 ©2010, Greater Houston Partnership Page 2
  • 3. HOUSTON—THE ECONOMY AT A GLANCE o Employment Trends: Employment in health care and social assistance con- tinued to grow throughout the recession, thanks to Houston’s growing and aging population. Over the past 12 months, the sector added 9,000 jobs. Mining employment has also held up well. In Houston, energy employment is more closely tied to worldwide activity than to anything else. The energy sector has added 1,200 jobs over the past 12 months. Changes over the past 12 months or from a specific point in time offer a better insight into employment trends. • For the 12 months ending June ’10, the Houston region lost 17,400 jobs, or a loss of 0.7 percent. As recently as December, the 12 month loss was 92,500 jobs, or 3.5 percent. • Private sector employment peaked at 2,268,500 jobs in August ’08 and trended downward for 17 months, bottoming out at 2,106,100 jobs in January ’10. Since January, the private sector has regained 42,700 of the 162,000 private sector jobs lost in the recession or about 26 percent of the total. Again, these are seasonally unadjusted numbers. The recovery, though slow, continues across the nation. Eight of the nation’s large- st metro areas now show over-the-year job growth. Houston is among 13 large metros that have over-the-year losses of less than 1 percent. Jobs losses for all large metros, those with 1.5 million or more in population, are now less than 3 percent. Unemployment Rate — Houston’s June unemployment rate stood at 8.8 percent. The unemployment rate for Austin was 7.4 percent, for Dallas-Fort Worth, 8.5 percent, and for San Antonio 7.1 percent. McAllen had the highest unemployment rate in the state at 12.2 percent and Midland had the lowest at 5.9 percent. The un- employment rate for Texas stood at 8.5 percent and for the United States at 9.6 percent. (All rates are not seasonally adjusted.) Office Market Remains Weak, Industrial Market Improving — The office market remains weak while the industrial market shows signs of improvement, according to Lynn Cirillo with CB Richard Ellis. The number of office leases signed in the first half of the year is up but net absorption is down as tenants downsize their space and take advantage of incentives such as free rent, abated parking, and flexible contract terms offered by landlords to keep tenants in their spaces. Though several submarkets reported positive net absorption this year, nota- bly the Energy Corridor and FM 1960/Highway 249 area, the market overall re- ported a negative net absorption of 645,000 square feet, which represents about 0.3 percent of the 190.2 million square feet of available space in Houston. Occupancy has declined for six consecutive quarters and the trend is anticipated to continue until the economy strengthens, Cirillo notes. August 2010 ©2010, Greater Houston Partnership Page 3
  • 4. HOUSTON—THE ECONOMY AT A GLANCE The industrial market absorbed 2.7 million square feet of space during the first six months of ’10, moving the vacancy rate from 7.1 percent in the first quarter to 7.0 percent at the end of the second. As in the office market, tenants are receiving concessions such as free rent or increased tenant improvement dollars as landlords negotiate early renewals to insure cash flow and continued occupancy. The in- dustrial market should continue to tighten as only 417,000 square feet of space is under construction, the U.S. economy continues to recover, and activity in the Port of Houston grows. New Vehicle Sales Up —Total monthly sales volume of new cars, trucks and SUVs in the Houston region increased from 13,474 vehicles in June ’09 to 16,642 vehicles in June ’10, according to TexAuto Facts Report published by InfoNation, Inc. of Sugar Land. This represents a 23.5 percent increase over the same month last year. Nationally, sales increased 14 percent for June ’10 compared with June ’09. Average sales price for the Houston region in June ’10 was $31,334, an 8.3 percent increase from the pre-recession price base of June ’07 when the average vehicle sales price was $28,932. Houston region truck/SUV sales continue to be significantly higher than the natio- nal trend. In ’09, truck/SUV market share was at 54.8 percent in the Houston re- gion while national truck/SUV sales were 46.6 percent in the first-half of ’10. Houston Airport System Posts Gains — The Houston Airport System posted year-to-year gains in passenger volume and air freight in June ’10. Passenger volume rose 1.6 percent over June ’09, as 4.5 million passengers passed through Houston’s commercial airports. Domestic volume had a 1.0 percent increase, while international volume rose 5.1 percent. International passenger vol- ume has had year-to-year gains since September ’09. This June saw international passengers account for 17.1 percent of total passengers—one of only 10 months since 1980 where the international share has accounted for 17 percent or more of total passengers. Landings and takeoffs fell 5.2 percent shy of the June ’09 total. Air freight volume, however, posted a 17.3 percent increase for the month. Postings and Foreclosures Drop — Harris County foreclosures totaled 1,252 in July ’10, down 2.0 percent from July ’09, while July ’10 postings totaled 4,092, down 8.4 percent from last July, reports Foreclosure Information & Listing Service. August 2010 ©2010, Greater Houston Partnership Page 4
  • 5. HOUSTON—THE ECONOMY AT A GLANCE A posting for foreclosure occurs when a property in default is scheduled for sale at a monthly foreclosure auction. A foreclosure occurs when the lienholder assumes ownership of a property in default. Since April ’10, the postings’ 12-month running total has been trending downward. The 12-month running total for foreclosures appears to have stabilized over the same time period. “While there will continue to be some volatility in posting activity, totals should continue to stabilize contingent upon the admittedly anemic recovery from the recession,” notes the service. Other good news is that the ratio of foreclosures to postings remains low, indi- cating that a large share of problem loans continues to be resolved before actual foreclosure. Over the past five years, the ratio has been as high as 49 percent, but since January the 12-month ratio has hovered around 27 percent. Foreign Trade Continues to Rise — The Houston-Galveston Customs District handled foreign trade valued at $18.3 billion in May, up 42 percent from $12.8 billion in May ’09, according to the U.S. Census Bureau. Exports totaled $7.9 billion, up 26 percent from $6.3 billion in May ’09. Imports totaled $10.4 billion, up 57 percent from $6.6 billion in May ’09. Foreign trade has been trending upward since bottoming out in February ’09. For the first five months of ’10, trade totaled $88.9 billion, up 34 percent from $62.7 billion last year. Exports were $36.9 billion, up 29 percent from $28.7 billion last year. Imports were $46.9 billion, up 38 percent from $34.0 billion last year. Fuel oils, chemicals, plastics, industrial machinery, boats, cereals and vehicles comprise the bulk of the goods passing through the Houston-Galveston Customs District. The recent surge in exports and imports reflects the improving U.S. and global economies. However, economists have expressed concern over imports rising faster than exports, indicating that foreign trade could pull down the nation’s growth in the second quarter. Oil Prices Remain Strong — The Friday closing spot market price for West Texas Intermediate crude oil (WTI) averaged 77.49 a barrel for the first half of ’10, compared to $57.11 for the first half of ’09. In its July Short-Term Energy Out- look, the Energy Information Administration projects the WTI spot price, which ended June near $76 per barrel, will average $79 per barrel over the second half of ’10 and $83 per barrel in ’11. The Friday closing spot market price of Henry Hub natural gas averaged $4.80 per MMBtu for the first half of ‘10, compared to $4.08 for the first half of ’09. In its August 2010 ©2010, Greater Houston Partnership Page 5
  • 6. HOUSTON—THE ECONOMY AT A GLANCE July Short-Term Energy Outlook, the agency forecasts the Henry Hub spot price to average $4.70 per MMBtu in ’10 and $5.17 in ’11. ____________________________________ The Greater Houston Partnership is the primary advocate of Houston’s business community and is dedicated to building regional economic prosperity. Visit the Greater Houston Partnership on the World Wide Web at www.houston.org. Contact us by phone at 713-844-3600. August 2010 ©2010, Greater Houston Partnership Page 6
  • 7. HOUSTON—THE ECONOMY AT A GLANCE Houston Economic Indicators YEAR-TO-DATE A Service of the Greater Houston Partnership MONTHLY DATA TOTAL OR AVERAGE* Most Year % Most Year % Month Recent Earlier Change Recent Earlier Change ENERGY U.S. Active Rotary Rigs June '10 1,531 896 70.9 1,428 * 1,139 * 25.4 Spot Crude Oil Price ($/bbl, West Texas Intermediate) June '10 75.24 69.83 7.7 77.91 * 51.77 * 50.5 Spot Natural Gas ($/MMBtu, Henry Hub) June '10 4.82 3.72 29.6 4.15 * 3.72 * 11.6 UTILITIES AND PRODUCTION Houston Purchasing Managers Index June '10 55.6 43.5 27.8 57.6 * 42.1 * 36.8 Nonresidential Electric Current Sales (Mwh, CNP Service Area) June '10 4,334,779 4,379,772 -1.0 23,880,000 23,417,237 2.0 CONSTRUCTION Total Building Contracts ($, Houston MSA) June '10 807,469,000 940,171,000 -14.1 4,450,558,000 4,405,880,000 1.0 Nonresidential June '10 372,985,000 457,672,000 -18.5 1,705,643,000 2,056,155,000 -17.0 Residential June '10 434,484,000 482,499,000 -10.0 2,744,915,000 2,349,725,000 16.8 Building Permits ($, City of Houston) June '10 316,146,383 405,603,929 -22.1 1,650,911,210 2,049,582,396 -19.5 Nonresidential June '10 214,397,061 327,650,118 -34.6 1,076,618,238 1,600,239,816 -32.7 New Nonresidential June '10 57,082,115 173,806,368 -67.2 348,975,126 573,656,214 -39.2 Nonresidential Additions/Alterations/Conversions June '10 157,314,946 153,843,750 2.3 727,643,112 1,026,583,602 -29.1 Residential June '10 101,749,322 77,953,811 30.5 574,292,972 449,342,580 27.8 New Residential June '10 83,323,104 54,089,231 54.0 440,108,475 329,925,250 33.4 Residential Additions/Alterations/Conversions June '10 18,426,218 23,864,580 -22.8 134,184,497 119,417,330 12.4 Multiple Listing Service (MLS) Activity Closings June '10 6,593 6,332 4.1 32,102 29,110 10.3 Median Sales Price - SF Detached June '10 159,700 164,500 -2.9 152,288 * 147,192 * 3.5 Active Listings June '10 53,934 45,989 17.3 49,148 * 45,206 * 8.7 EMPLOYMENT (Houston-Sugar Land-Baytown MSA) Nonfarm Payroll Employment June '10 2,526,600 2,542,900 -0.6 2,506,100 * 2,557,200 * -2.0 Goods Producing (Natural Resources/Mining/Const/Mfg) June '10 476,900 495,400 -3.7 473,300 * 510,200 * -7.2 Service Providing June '10 2,049,700 2,047,500 0.1 2,032,800 * 2,047,000 * -0.7 Unemployment Rate (%) - Not Seasonally Adjusted Houston-Sugar Land-Baytown MSA June '10 8.8 8.0 8.6 * 6.9 * Texas June '10 8.5 8.6 8.3 * 7.5 * U.S. June '10 9.6 9.7 9.9 * 9.0 * Unemployment Insurance Claims (Gulf Coast WDA) Initial Claims June '10 23,729 28,120 -15.6 22,449 * 26,982 * -16.8 Continuing Claims June '10 108,819 150,163 -27.5 109,619 * 126,462 * -13.3 TRANSPORTATION Port of Houston Authority Shipments (Short Tons) June '10 3,448,962 2,886,101 19.5 19,123,164 18,249,204 4.8 Air Passengers (Houston Airport System) June '10 4,538,752 4,465,449 1.6 24,143,096 23,662,358 2.0 Domestic Passengers June '10 3,764,338 3,728,819 1.0 19,999,674 19,847,475 0.8 International Passengers June '10 774,414 736,630 5.1 4,143,422 3,814,883 8.6 Landings and Takeoffs June'10 72,892 76,899 -5.2 421,988 438,474 -3.8 Air Freight (000 lb) June '10 74,601 63,616 17.3 430,738 365,947 17.7 Enplaned June '10 38,702 33,844 14.4 226,112 196,422 15.1 Deplaned June '10 35,899 29,772 20.6 204,626 169,525 20.7 CONSUMERS New Car and Truck Sales (Units, Houston MSA) June '10 20,994 16,598 26.5 122,011 103,515 17.9 Cars June '10 9,345 7,672 21.8 55,813 46,129 21.0 Trucks, SUVs and Commercials June '10 11,649 8,926 30.5 66,198 57,386 15.4 Total Retail Sales ($000,000, Houston MSA, NAICS Basis) 3Q09 18,738 20,136 -6.9 53,679 59,150 -9.3 Consumer Price Index for All Urban Consumers ('82-'84=100) Houston-Galveston-Brazoria CMSA June '10 194.734 192.325 1.3 192.468 * 190.017 * 1.3 United States June '10 217.965 215.693 1.1 216.735 * 214.658 * 1.0 Hotel Performance (Harris County) Occupancy (%) Dec '09 45.5 57.5 60.2 * 70.1 * Average Room Rate ($) Dec '09 108.44 118.29 -8.3 116.79 * 126.58 * -7.7 Revenue Per Available Room ($) Dec '09 49.38 68.06 -27.4 70.30 * 88.79 * -20.8 POSTINGS AND FORECLOSURES Postings (Harris County) July '10 4,092 4,466 -8.4 26,974 22,325 20.8 Foreclosures (Harris County) July '10 1,252 1,278 -2.0 7,839 6,310 24.2 August 2010 ©2010, Greater Houston Partnership Page 7
  • 8. HOUSTON—THE ECONOMY AT A GLANCE Sources Rig Count Baker Hughes Incorporated Port Shipments Port of Houston Authority Spot WTI, Spot Natural Gas U.S. Energy Information Agency Aviation Aviation Department, City of Houston Purchasing Managers National Association of Houston Index Purchasing Management – Car and Truck Sales TexAuto Facts Report, InfoNation, Houston, Inc. Inc., Sugar Land TX Electricity CenterPoint Energy Retail Sales Texas Comptroller’s Office Building Construction Contracts McGraw-Hill Construction Consumer Price Index U.S. Bureau of Labor Statistics City of Houston Building Permits Building Permit Department, City Hotels PKF Consulting/Hospitality Asset of Houston Advisors International MLS Data Houston Association of Realtors® Postings, Foreclosures Foreclosure Information & Listing Employment, Unemployment Texas Workforce Commission Service STAY UP TO DATE! If you would like to receive this electronic publication on the first working day of each month, please e- mail your request for Economy at a Glance to rpate@houston.org. Include your name, title and phone number and your company’s name and address. Archived copies are available to Partnership Members in the Members Only section at www.houston.org. For information about joining the Greater Houston Partnership and gaining access to this powerful resource, call Member Services at 713-844-3683. The foregoing table is updated whenever any data change — typically, 11 or so times per month. If you would like to receive those updates by e-mail, usually accompanied by commentary, please e-mail your request for Key Economic Indicators to rpate@houston.org with the same identifying information. You may request Glance and Indicators in the same e-mail. August 2010 ©2010, Greater Houston Partnership Page 8
  • 9. HOUSTON—THE ECONOMY AT A GLANCE HOUSTON MSA NONFARM PAYROLL EMPLOYMENT (000) Change from % Change from Jun ' 10 May ' 10 Jun '09 May '10 Jun '09 May '10 Jun '09 Total Nonfarm Payroll Jobs 2,526.6 2,526.0 2,544.0 0.6 -17.4 0.0 -0.7 Total Private 2,148.7 2,135.6 2,180.0 13.1 -31.3 0.6 -1.4 Goods Producing 476.9 473.9 495.4 3.0 -18.5 0.6 -3.7 Service Providing 2,049.7 2,052.1 2,048.6 -2.4 1.1 -0.1 0.1 Private Service Providing 1,671.8 1,661.7 1,684.6 10.1 -12.8 0.6 -0.8 Mining and Logging 89.1 87.9 86.7 1.2 2.4 1.4 2.8 Oil & Gas Extraction 50.9 50.1 48.5 0.8 2.4 1.6 4.9 Support Activities for Mining 37.2 36.8 37.2 0.4 0.0 1.1 0.0 Construction 167.4 167.3 183.7 0.1 -16.3 0.1 -8.9 Manufacturing 220.4 218.7 225.0 1.7 -4.6 0.8 -2.0 Durable Goods Manufacturing 140.8 139.2 144.0 1.6 -3.2 1.1 -2.2 Nondurable Goods Manufacturing 79.6 79.5 81.0 0.1 -1.4 0.1 -1.7 Wholesale Trade 127.3 127.0 131.7 0.3 -4.4 0.2 -3.3 Retail Trade 261.4 259.7 262.2 1.7 -0.8 0.7 -0.3 Transportation, Warehousing and Utilities 119.0 118.4 123.1 0.6 -4.1 0.5 -3.3 Utilities 16.6 16.5 16.7 0.1 -0.1 0.6 -0.6 Air Transportation 24.0 23.8 24.7 0.2 -0.7 0.8 -2.8 Truck Transportation 18.6 18.4 19.1 0.2 -0.5 1.1 -2.6 Pipeline Transportation 8.9 8.9 8.7 0.0 0.2 0.0 2.3 Balance, incl Warehousing, Water & Rail Transport 50.9 50.8 53.9 0.1 -3.0 0.2 -5.6 Information 32.9 32.8 34.9 0.1 -2.0 0.3 -5.7 Telecommunications 17.7 17.6 18.1 0.1 -0.4 0.6 -2.2 Finance & Insurance 86.1 86.1 88.5 0.0 -2.4 0.0 -2.7 Real Estate & Rental and Leasing 51.3 50.9 51.5 0.4 -0.2 0.8 -0.4 Professional & Business Services 351.9 349.3 359.0 2.6 -7.1 0.7 -2.0 Professional, Scientific & Technical Services 169.5 168.0 174.9 1.5 -5.4 0.9 -3.1 Legal Services 23.2 22.9 23.4 0.3 -0.2 1.3 -0.9 Accounting, Tax Preparation, Bookkeeping 15.7 15.5 16.9 0.2 -1.2 1.3 -7.1 Architectural, Engineering & Related Services 60.2 59.4 61.2 0.8 -1.0 1.3 -1.6 Computer Systems Design & Related Services 23.7 23.8 24.1 -0.1 -0.4 -0.4 -1.7 Admin & Support/Waste Mgt & Remediation 162.3 161.1 164.6 1.2 -2.3 0.7 -1.4 Administrative & Support Services 154.6 153.4 156.3 1.2 -1.7 0.8 -1.1 Employment Services 51.3 50.6 54.0 0.7 -2.7 1.4 -5.0 Educational Services 42.4 43.1 41.3 -0.7 1.1 -1.6 2.7 Health Care & Social Assistance 263.9 263.0 254.9 0.9 9.0 0.3 3.5 Arts, Entertainment & Recreation 31.3 29.8 31.5 1.5 -0.2 5.0 -0.6 Accommodation & Food Services 210.8 209.2 212.3 1.6 -1.5 0.8 -0.7 Other Services 93.5 92.4 93.7 1.1 -0.2 1.2 -0.2 Government 377.9 390.4 364.0 -12.5 13.9 -3.2 3.8 Federal Government 35.9 40.1 28.9 -4.2 7.0 -10.5 24.2 State Government 69.3 71.2 67.1 -1.9 2.2 -2.7 3.3 State Government Educational Services 36.1 38.1 33.6 -2.0 2.5 -5.2 7.4 Local Government 272.7 279.1 268.0 -6.4 4.7 -2.3 1.8 Local Government Educational Services 184.6 191.8 182.1 -7.2 2.5 -3.8 1.4 SOURCE: Texas Workforce Commission August 2010 ©2010, Greater Houston Partnership Page 9
  • 10. HOUSTON—THE ECONOMY AT A GLANCE HOUSTON AIRPORT SYSTEM PASSENGER VOLUMES 1985 - 2011 50 9 45 8 INTERNATIONAL (000,000, 12 MONTHS ENDING 40 7 DOMESTIC (000,000), 12 MONTHS ENDING 35 6 30 5 25 4 20 3 15 2 10 5 1 0 0 1/85 1/87 1/89 1/91 1/93 1/95 1/97 1/99 1/01 1/03 1/05 1/07 1/09 1/11 DOMESTIC INTERNATIONAL Source: Houston Airports System HOUSTON MSA EMPLOYMENT 2001-2011 2.65 160 2.60 140 2.55 120 NONFARM PAYROLL EMPLOYMENT (000,000) 2.50 100 2.45 80 2.40 60 12-MONTH CHANGE (000) 2.35 40 2.30 20 2.25 0 2.20 -20 2.15 -40 2.10 -60 2.05 -80 2.00 -100 1.95 -120 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 12-MONTH CHANGE JOBS Source: Texas Workforce Commission August 2010 ©2010, Greater Houston Partnership Page 10
  • 11. HOUSTON—THE ECONOMY AT A GLANCE GOODS-PRODUCING AND SERVICE-PROVIDING EMPLOYMENT HOUSTON MSA 2001-2011 550 2.25 540 2.20 530 2.15 2.10 520 SERVICE-PROVIDING (000,000) 2.05 GOODS-PRODUCING (000) 510 2.00 500 1.95 490 1.90 480 1.85 470 1.80 460 1.75 450 1.70 440 1.65 430 1.60 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 GOODS-PRODUCING JOBS SERVICE-PROVIDING JOBS Source: Texas Workforce Commission UNEMPLOYMENT RATE HOUSTON & U.S. 2001-2011 11 10 9 8 PERCENT OF LABOR FORCE 7 6 5 4 3 2 1 0 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-09 Jan-11 HOUSTON U.S. Source: Texas Workforce Commission August 2010 ©2010, Greater Houston Partnership Page 11
  • 12. HOUSTON—THE ECONOMY AT A GLANCE SPOT MARKET ENERGY PRICES 2001 - 2011 140 28 120 24 HENRY HUB NATURAL GAS ($/MMBTU) WEST TEXAS INTERMEDIATE ($/BBL) 100 20 80 16 60 12 40 8 20 4 0 0 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 WTI MONTHLY WTI 12-MO AVG GAS MONTHLY GAS 12-MO AVG Source: U.S. Energy Information Administration INFLATION: 12-MONTH CHANGE 2001-2011 6% 5% 4% 3% 2% 1% 0% -1% -2% -3% Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 HOUSTON CPI-U U.S. CPI-U Source: U.S. Bureau of Labor Statistics August 2010 ©2010, Greater Houston Partnership Page 12