Houston’s economy is deteriorating even faster than we at the IRF expected. Year-over-year employment comparisons for April show job losses of 35,000 or almost 1.4%. All of these losses have come since seasonally adjusted employment peaked in November of last year. That’s a loss of about 7,000 per month, frightening close to the declines of 10,000 per month experienced during the worst of the 80s bust. These numbers mean that Houston has already lost about 57% of the decline the IRF forecast at this May’s symposium.
The job losses are across the board with only a few surprises. Most startling is the sudden reversal in construction. Construction alone accounts for 13,500 of the job losses, down a surprising 6.5%. On the other hand, employment in retail sales and finance turned out to be somewhat better than expected.
Overall, the region’s secondary sectors have experienced a decline of 1.48% and the economic base has contracted 1.03%. Upstream energy employment is down .7%; downstream is down 1.4%; and the region’s non-energy related base is down 1.2%. This shows a rather remarkable even distribution of the pain. In the coming months, expect greater losses in upstream energy, which will lead the overall regional economy further into the hole. (Full details are contained in the IRF’s publication, DataBook Houston.)
While the Houston recession is unfolding faster than expected, it is not a total surprise, given continued national job losses. As indicated at May’s symposium, Houston’s primary hope lies in a U.S. recovery, a recovery that is far from certain. As long as the nation continues to experience new jobless claims each week in excess of 600,000, we can only expect things in Houston to get progressively worse.
Read Previous Houston Updates
- Houston Update (March 13, 2009) - "Data Revisions Show That The Houston Slowdown Is Already Here!"
- Houston Update (November 29, 2008) - "Houston Slowdown Continues"
- Houston Update (June 18, 2008) - "Houston Stays On Top"
- Houston Update (July 16, 2008) - "Houston's Economy Slows"
- Houston Update (August 19, 2008) -
"Home Market Woes Worsen"
- Houston Update (September 9, 2008) - "
Is the Houston Slowdown for Real this Time?"
- Houston Update (September 22, 2008) - "Houston's Economy Slows Even Before Ike"
- Houston Update (November 18, 2008) - "Houston’s Economy To Slow Significantly"
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