Houston, “America’s Coolest Cities to Live”

by CoyDavidson on August 27, 2012

Houston skyline at sunset

Houston Economic Outlook – Mid-Year 2012

Houston ranked among the top-performing U.S. metros in 2011 and continues to lead the nation in population and job growth in 2012. Although 2009 was undeniably challenging with local job losses totaling 95,200, this was the first year Houston suffered job losses following a stellar period of expansion and job growth from 2005 thru 2008. While the nation’s economy still has hurdles to overcome, Houston is once again making headlines as having one of the healthiest economies in the U.S. In its March 2012 issue, Site Selection ranked Houston #1 for “Tier One New and Expanded Facilities in 2011” for MSA’s with population over 1 million, securing 195 corporate facility expansion projects. In addition, Chief Executive Magazine (for the eighth straight year) named Texas as the number one state for Best Business, in which Houston’s energy industry played a huge part. In July 2012, Forbes ranked Houston #1 in the following categories: “America’s Coolest Cities to Live”, “Big Cities Where Self-Employment is Growing the Fastest”, and “Cities Where a Paycheck Stretches the Furthest”.

Houston’s economic base comprises varied mature industries led by the energy sector, accounting for just over 50 percent of the local economy. Following the energy price peaks at midyear 2008, with crude oil trading at $133 per barrel and natural gas over $8 per MMBtu, the industry experienced increased volatility due in large part to prevailing uncertainty regarding the worst global economic recession in recent history. After oil prices spiked last year, demand decreased, increasing supply. During the first half of 2012, energy prices have decreased and at mid-year crude oil was near $84 per barrel and natural gas prices reached historical lows, just below $2.50 per MMBtu. According to the U.S. Energy Information Administration, the West Texas Intermediate (WTI) crude oil spot price will average about $88 per barrel over the second half of 2012. Increased demand, particularly from emerging markets led by China and India with mass-scale industrialization projects underway, is the primary reason many industry experts are convinced the era of low crude oil prices is over and prices are expected to increase 23 percent by 2030, while global energy demand will increase an even more significant 55 percent during the same period.

Houston’s strategic location and core strengths, including an expanding energy sector, strong import/export trade activity, cutting-edge medical advancements, and technological breakthroughs across industries, uniquely position it to play a vital role in meeting national and global market demands. At a time of unprecedented geopolitical demographic shifts affecting markets worldwide, Houston stands as a leader among U.S. metros of the 21st century.

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