The Houston metropolitan area is at an employment peak, says Patrick Jankowski of the Greater Houston Partnership. The area added 120,600 jobs in 2014, an increase of 4.3 percent from the previous year.
Jankowski says the Houston area will continue to see overall job growth in 2015, but falling oil prices will likely lead to decreased job growth in the energy industry. He says every job in energy supports three to four jobs in other sectors as consumers have more money to spend on goods and services.
“We’re entering another phase in the business cycle, and it’s going to be a phase of slower growth,” he says.
At 4.7 percent, Houston’s unemployment rate remains below the national rate of 5.5 percent. Wages also continued to increase. Houston workers earned $169.7 billion in 2013, an increase of 24.6 percent from 2009.
Last year, the Houston metro area added 79,600 jobs.
UPDATE: 4:41 p.m.
Jankowski falling oil prices likely mean lower profits, which could lead to layoffs in the energy industry.
“We’re our own worst enemy,” he said. “We have doubled the amount of production coming out of Texas over the last five years. We’re got more oil out there than we can consume. It’s pushing prices down.”
So how would a slowdown in the energy industry affect the average Houstonian? Jankowski says many people may not see a direct impact, but news of layoffs could make some consumers cautious. They’ll still spend, just spend less.
“It’s not that the bubble’s popped or the good times won’t keep on going,” he said. “It’s simply that we’re entering another phase in the business cycle, and it’s going to be a phase of slower growth.”
Jankowski appeared as a guest on Houston Matters.
The Greater Houston Partnership is expected to release its forecast for the economic outlook in 2015 tomorrow.