The most recent addition of DataBook Houston shows that the Houston area economy continues to slow down. Twelve months ago Houston’s year-over-year growth rate was 4.6%. Today, the BLS reports a growth rate of 2.2%. However, while at the end of summer last year the BLS data was telling the same story: the March revisions to the 2007 numbers indicated that there was no slowdown at all. Might that be the same situation this year?
The Dallas Federal Reserve Bank attempts to rebenchmark the data more regularly than the BLS, and what they are now report is that once again the BLS numbers for 2008 will likely again require an upward revision next March. However, at this point the upward revision in regional employment numbers appears will be less than 20,000 jobs. If that’s the case, the “true” growth rate for Houston is more likely around 3.0% instead of 2.2%. That remains an impressive growth rate, given the continuous job losses experienced this year at the national level, but it is a reduction over last year’s regional growth. If the slowdown continues through the rest of this year, then Houston’s growth rate for the entire year will end up very close to the IRF’s forecast of 2.8% growth. This would virtually assure that Houston will maintain its position as the fastest growing large city in America. Whether that spills over to 2009 will greatly depend upon how far the current correction in oil and natural gas prices goes this fall and winter. |