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A publication of the Greater Houston Partnership

Volume 22, Number 2 February 2013

A Three-Peat for Houston 12 marked the third consecutive year in which Houston led the state in job growth. Houston, with 23.7 percent of the states population, accounted for 31.8 percent of the states job growth last year. The 10-county metro area added 84,500 jobs, a 3.2 percent increase over the previous year. GHPs official employment forecast called for the region to create 84,600 net new jobs in 12. Growth in the region fell short of the GHP forecast by only 100 jobs, essentially a rounding error in an economy with 2.7 million in total nonfarm payroll employment. Texas Metro Areas Ranked by Total Jobs Created
Metro Area Houston-Sugar Land-Baytown Dallas-Fort Worth-Arlington Austin-Round Rock-San Marcos San Antonio-New Braunfels El Paso Corpus Christi Odessa Waco McAllen-Edinburg-Mission Midland Wichita Falls Beaumont-Port Arthur Killeen-Temple-Fort Hood Amarillo Texarkana Tyler Abilene Laredo Victoria San Angelo Longview College Station-Bryan Sherman-Denison Lubbock Brownsville-Harlingen State of Texas
Source: Texas Workforce Commission

December Employment '12 '11 2,731,000 3,040,500 833,900 878,600 287,800 187,500 71,300 107,800 235,100 78,100 60,100 159,500 131,600 115,600 60,200 98,500 66,700 96,700 52,100 47,700 99,600 97,600 43,600 130,200 125,600 10,972,800 2,646,500 2,961,300 799,300 856,600 284,300 184,900 68,900 105,400 232,900 76,000 58,000 157,500 129,700 113,900 58,500 96,800 65,100 95,200 50,900 46,700 98,700 96,900 44,000 132,000 130,000 10,707,300

Annual Change Nominal % 84,500 79,200 34,600 22,000 3,500 2,600 2,400 2,400 2,200 2,100 2,100 2,000 1,900 1,700 1,700 1,700 1,600 1,500 1,200 1,000 900 700 -400 -1,800 -4,400 265,500 3.2 2.7 4.3 2.6 1.2 1.4 3.5 2.3 0.9 2.8 3.6 1.3 1.5 1.5 2.9 1.8 2.5 1.6 2.4 2.1 0.9 0.7 -0.9 -1.4 -3.4 2.5
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February 2013

2013, Greater Houston Partnership

HOUSTONTHE ECONOMY AT A GLANCE Data sets for the full year are now available for most sectors. This issue of Glance reviews them. Going, Going, Gone Houston realtors sold 74,682 homes in 12, a 17.4 percent increase over the 63,606 sold in 11, reports the Houston Association of REALTORS (HAR). Last year was the fourth best year on record. That performance should be viewed in the proper context. Subprime lending fueled sales in the three best years on record, so last years volume sustained by solid fundamentalswas truly a milestone. Five factors drove those salesjob growth, household income growth, low interest rates, pent-up demand, and growing consumer confidence. The Texas Workforce Commission reports the Houston region gained more than 250,000 net new jobs since the bottom of the recession, giving many would-be homeowners the wherewithal to purchase a house, condo or townhome. Metro Houston Home Sales*
Year '12 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 Sales 74,682 63,606 61,005 63,801 69,336 83,736 87,799 79,012 72,183 64,600 58,914

The U.S. Census Bureau reports that between 09 and 11 * Includes houses, duplexes, the number of households with annual incomes of $75,000 townhomes, condominiums or greater grew by more than 48,000. As a rule a thumb, a Source: Houston Association of REALTORS household can afford a home worth two to three times its annual income. The market for homes in Houston priced at or above $150,000 has been the strongest. When data becomes available for 12, another 16,000 to 20,000 local households will most likely be above the $75,000 threshold. In 10 (the year Houston began to emerge from the recession), local realtors sold 61,005 homes, the fewest since 02, according to HAR. Houston also had one million fewer residents in 02. Clearly, Houstonians had postponed buying homes during the recession until they felt more confident about their economic prospects. The cost of borrowing has gone down. In August 08, the typical interest on a 30-year, fixed rate conventional mortgage was 6.48 percent, according to data compiled by the Federal Reserve Bank of St. Louis. As of December 12, the rate was 3.35 percent. The strong performance of Houstons economy over the past three years has boosted Houstonians confidence. History will show that Houston was the first of the major U.S. metro areas to recover from the recession. 1

Houston returned to its pre-recession employment peak in November 11. Of the nations 20 most populous metro areas, only Washington, D.C. and Dallas-Fort Worth have returned to their previous peaks, and they did so after Houston. February 2013 2013, Greater Houston Partnership Page 2

HOUSTONTHE ECONOMY AT A GLANCE The national media have noted Houstons strong performance as well. In July 12, Forbes rated Houston number one among Americas Coolest Cities to Live. Forbes based the rankings on the number of entertainment options per capita, recreational opportunities, number of pro and college sports teams, number of restaurants and bars per capita, cultural composition, median age, net migration in 11 and unemployment rates. In March 12, Site Selection ranked Houston the top metro for new and expanded corporate facilities. The ranking was based on the 195 projects that GHP identified and submitted to publishers. 2 In January 12, Business Insider ranked Houston number one among U.S. cities with the Fastest-Growing Wages in America. The organizations PayScale Index tracks how many times private sector wages have changed since 06. Two more items of note. First, the sale of foreclosed homes no longer has a significant impact on the market. In January 09, one in every three homes sold through HARs Multiple Listing Service was a foreclosure. By December 12, foreclosures accounted for one in seven sales. Second, supply remains tight. Houston has 3.7 months of available inventory, i.e., the number of months it would take to deplete current active inventory based on the prior 12 months of sales activity. Six months of inventory is considered a balanced market. As recently as June 11, Houston had a 7.9-month inventory. Looking ahead to 13, the GHP doesnt see any significant shifts in the above fundamentals. Houston realtors should enjoy another strong year of home sales. Beep-beep, beep-beep, yeah! Auto dealers in the Houston metro area sold 325,088 vehicles, a 27.5 percent increase over the 254,996 sold in 11, reports TexAuto Facts, published by InfoNation, Inc. of Sugar Land. This represents the third best year in the past 10. Like housing, solid fundamentalsjob growth, income growth, pent-up demand, growing consumer confidencedrove auto sales. Several factors specific to the autos drove sales as well: Motorists who held onto their vehicles in uncertain times finally felt comfortable trading in their clunkers for more recent models. According to R.L. Polk & Company, the global automotive intelligence firm, the average age of the U.S. passenger vehicle in June 11 was 11.1 years; for a light truck, it was 10.4 years. That compares to around 8.4 years for both vehicle types in the mid-90s. Granted, it is better that vehicles last longer now, but the aging of the fleet helps spur sales. And older cars are less likely to

A list of the projects which have relocated or expanded to Houston in the past three years can be purchased through the Partnerships Publication Sales Department, 713-844-3600. February 2013 2013, Greater Houston Partnership Page 3

HOUSTONTHE ECONOMY AT A GLANCE be covered by insurance and thus more likely to be replaced rather than repaired after a collision. Light truck sales (i.e., the sale of pickup trucks) depend heavily on the health of the local housing market. Pickup trucks are the work horses for construction contractors. Drive by any construction site and pickups are likely to outweigh autos by a ratio of three-to-one. The surge in construction, discussed later in Glance, helped stimulate demand for new pickups. The inventory of used vehicles continues to dwindle, forcing more buyers into the new car market. This trend is partly driven by U.S. car rental companies, which had sold their used vehicles in the domestic market, now selling their used vehicles into overseas markets where they receive higher profits. Metro Houston Vehicle Sales
Year '12 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 Units Sold 325,088 254,996 240,354 218,710 306,860 358,770 349,368 322,068 303,984 319,940 343,738

* Includes passenger vehicles and light duty trucks

Auto sales should continue to grow this year. As noted earlier, Source: TexAuto Facts pubGHP foresees no significant changes to fundamentals that drove lished by InfoNation of Sugthe market in 12. The industry anticipates an increase in ar Land younger consumers as the job market continues to improve. In addition, R.L. Polk reports auto manufacturers plan to introduce 43 new vehicles this year and 60 redesigns of existing vehicles. The new and refreshed products will draw traffic to showrooms and generate an uptick in sales. And Houston remains a car-dependent metro. InfoNation anticipates local auto sales should grow another six to eight percent, barring any significant negative economic events. Up, Up and Away! The Houston Airport System (HAS) set a record for international passenger traffic in 12, handling 8.76 million international travelers, an increase of 1.5 percent from 8.64 million in 11. Travel between Houston and the Asian and African markets, up 29.9 percent over 11, fueled much of the growth. Canadian traffic grew 11.4 percent, Central/South American traffic grew 2.8 percent, and European traffic grew 1.6 percent. Traffic between Houston and the Middle East fell 10.0 percent, and traffic between Houston and Mexico decreased 3.9 percent. Airport officials expect international traffic to continue growing as more carriers add international service from Houston. Pending government approval, direct flights to Beijing will occur four times a week starting July 13. Travel to the Middle East is expected to grow as Turkish Airlines initiates four weekly nonstop services to Istanbul beginning April 13. Southwest Airlines is investing $100 million at Houston Hobby Airport (HOU) and plans to begin service to Mexico and the Caribbean starting 15. Currently, one in every six passengers flying out of Houston is travelling internationally.
February 2013 2013, Greater Houston Partnership Page 4

HOUSTONTHE ECONOMY AT A GLANCE Domestic traffic, which acHOUSTON AIRPORT SYSTEM ACTIVITY counts for 82.6 percent of all passengers, grew 0.6 percent 12 11 Change from 41.39 million passengers Total passengers 50,329,002 50,030,744 0.6% in 11 to 41.56 million pasDomestic 41,564,457 41,393,412 0.4% sengers in 12. Slower growth International 8,764,545 8,637,332 1.5% in passenger traffic and declines in landings and takeoffs Landings and Takeoffs 812,237 854,222 -4.9% is expected as airlines focus Air cargo (metric tons) 419,306 423,761 -1.1% more on profitability and capacity discipline and less on Source: Houston Airport System gaining market share from competitors. This discipline results in fewer seats and/or flights which has been experienced to some degree in Houston and is reflected in HAS domestic passenger traffic. The Welcome Mat is Out In January, the Association of Foreign Investors in Real Estate (AFIRE) ranked Houston as the fifth best city in the world for real estate investment. 3 This was no popularity contest. Their confidence is well-placed. Last year, the Houston market absorbed 4.4 million square feet of office spacethe second highest absorption since 06, when the market absorbed 5.4 million square feet. Large blocks of contiguous space in showcase buildings remain hard to find. In four buildings representative of the best Class A space in the Central Business District 717 Texas, 5 Houston Center, 1000 Main and Heritage Plazaoccupancy ranges from 97.5 to 100 percent. In three suburban buildings representative of the best Class A space in the submarketsWilliams Houston Office Market Tower, 9 Greenway Plaza and Two El- Market Overview '11 '12 dridge Placeoccupancy ranges be1 2.6 M 4.4 M Total Absorption tween 95.0 to 99.0 percent.
Vacancy Rate Rental Rates2 CBD Suburban CBD Suburban
1) million square feet 2) $/SF/Year Source: Colliers International

15.5%

13.8%

Most construction is concentrated in the three major submarkets with some of the lowest vacancy ratesKaty/Energy Corridor, Galleria/Uptown, and The Woodlands. Of the 4.4 million square feet of office space under construction, more than half is pre-leased. Houstons industrial market remains equally strong. CBRE Research reports the industrial vacancy rate fell from 5.6 percent
3

$23.20 $35.29 $27.34

23.970 $37.02 $28.20 9.8% 11.4%

Class A Rental Rates2

Class A Vacancy 14.3% 14.1%

The top four cities, in order or ranking, are New York, London, San Francisco and Washington, D.C. February 2013 2013, Greater Houston Partnership

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HOUSTONTHE ECONOMY AT A GLANCE in Q4/11 to 5.1 percent in Q4/12. The market absorbed 6.4 million square feet of industrial space, with another 4.9 million square feet currently under construction. And lease rates, at an average of $0.53 per square foot per month, are up from $0.52 in Q4/11 and $0.48 in Q4/10. Another First Place Finish Houston led the nation in home construction last year, both in value of construction and units permitted. This is the third consecutive year Houston has led the nation. Data for the years 11 and 12:
New Residential Building Permits (single and multi-family units) 11 Houston Dallas New York Los Angeles Washington Atlanta Miami Chicago Boston Philadelphia 31,271 24,827 21,539 14,247 19,657 8,634 7,532 7,593 6,139 6,979 12 43,451 33,797 26,931 17,407 22,352 14,356 12,626 9,425 8,902 9,042 % Change 38.9 36.1 25.0 22.2 13.7 66.3 67.6 24.1 45.0 29.6 New Residential Building Permits ($ value, 000s) 11 4,831,152 4,348,698 3,252,738 2,997,275 2,937,160 1,400,186 1,307,935 1,514,928 1,327,032 966,394 12 6,921,004 5,604,591 3,722,415 3,677,236 3,322,646 2,325,613 2,065,068 1,945,994 1,844,109 1,274,649 % Change 43.3 28.9 14.4 22.7 13.1 66.1 57.9 28.5 39.0 31.9

Metro Area

Source: U.S. Census Bureau, Building Permits Survey

Metrostudy reports that in 12 few homes under construction showed up as finished units for sale because the homes were sold before construction was completed. In December 12, there were only 2,298 speculative homes under construction and 1,097 speculative homes finished and vacant. Construction in general continues to rebound. More than $10.6 billion in construction contracts were awarded in the 10-county Houston metro area last year, up 19.2 percent from the $9.0 billion awarded in 11. Readers are cautioned that values for 12 are incomplete and will be revised over coming months. Case in point: with the release of yearend data for 12, the final revision for 11 was also released. As a result, 11 tallied $534.9 million more construction activity than originally reported. The GHP expects similar revisions for 12 when the final data are released this time next year.

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HOUSTONTHE ECONOMY AT A GLANCE Grow, Grow, Grow Over the next five years, Houston will grow faster than any other major metro in Texas, according to the recently released report, The Perryman Economic Forecast, Short-Term Outlook for the United States, Texas, REAL GROSS AREA and Major Texas Metropolitan Statistical Areas. Perryman PRODUCT GROWTH RATES, 12 17 states that between 12 and 17, Houstons real gross area product (GAP) will grow at a 5.0 percent compound an- Metro Area CAGR* nual rate (CAGR). The report states that the oil and gas in- Houston 5.00% dustry, while cyclical in nature, will continue to drive the Ft. Worth 4.77% regions economy. The Port of Houston and other regional 4.59% facilities will play greater roles as global economies im- Austin 4.55% prove. Health care and technology businesses will also Dallas 4.25% drive growth. Perryman calculates Houstons GAP at San Antonio 3.89% $480.6 billion in 12, or $394.5 in inflation-adjusted 05 El Paso dollars. By 17, Houstons nominal GAP will exceed *Compound Annual Growth Rate $708.6 billion, or $503.6 billion in inflation-adjusted 05 Source: The Perryman Group dollars. Perryman forecasts mining, i.e., oil and gas extraction, to grow at a 7.4 percent CAGR, durable goods manufacturing at 5.3 percent, services at 5.1 percent, manufacturing at 4.8 percent, wholesale and retail trade at 4.7 percent, nondurables manufacturing at 4.5 percent, transportation/warehousing at 4.4 percent, finance/insurance/real estate at 3.7 percent, construction at 3.2 percent, and government at 2.3 percent. Current and Projected Values of Houston MSA Gross Product By Industry, $ Billions*
$109.5 $107.8

2012
$82.0

2017

$76.5

$84.2

$64.9

$61.2

$51.2

$44.3

$55.6

$30.0

$24.1

$23.7

$26.5

$17.3

$20.2

Mining

Services

Manufacturing

FIRE

Trade

TWU

Government

Construction

Information

* Inflation-adjusted '05 dollars TWU= Transportation, Warehousing, and Utilities; FIRE = Finance, Insurance and Real Estate Source: The Perryman Group, Winter 2012

February 2013

2013, Greater Houston Partnership

$8.0

$10.4 Page 7

HOUSTONTHE ECONOMY AT A GLANCE


Patrick Jankowski and Jenny Philip contributed to this issue of Houston: The Economy at a Glance

STAY UP TO DATE!

Are you a GHP Member? If so, log in to your account here and access archived issues of Glance available only to members. You can also sign-up RSS feeds to receive Houstons latest economic data throughout the month. If you are a non-member and would like to receive this electronic publication on the first working day of each month, please email your request for Economy at a Glance to dmorrow@houston.org. Include your name, title and phone number and your companys name and address. For information about joining the Greater Houston Partnership and gaining access to this powerful resource, call Member Services at 713-844-3683. The Key Economic Indicators 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 email your request for Key Economic Indicators to dmorrow@houston.org with the same identifying information. You may request Glance and Indicators in the same email.

February 2013

2013, Greater Houston Partnership

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HOUSTONTHE ECONOMY AT A GLANCE


Houston Economic Indicators A Service of the Greater Houston Partnership Month ENERGY U.S. Active Rotary Rigs Spot Crude Oil Price ($/bbl, West Texas Intermediate) Spot Natural Gas ($/MMBtu, Henry Hub) UTILITIES AND PRODUCTION Houston Purchasing Managers Index Nonresidential Electric Current Sales (Mwh, CNP Service Area) CONSTRUCTION Total Building Contracts ($, Houston MSA) Nonresidential Residential Building Permits ($, City of Houston) Nonresidential New Nonresidential Nonresidential Additions/Alterations/Conversions Residential New Residential Residential Additions/Alterations/Conversions Multiple Listing Service (MLS) Activity Closings Median Sales Price - SF Detached Active Listings EMPLOYMENT (Houston-Sugar Land-Baytown MSA) Nonfarm Payroll Employment Goods Producing (Natural Resources/Mining/Const/Mfg) Service Providing Unemployment Rate (%) - Not Seasonally Adjusted Houston-Sugar Land-Baytown MSA Texas U.S. FOREIGN TRADE (Houston-Galveston Customs District) Port of Houston Authority Shipments (Short Tons) Air Passengers (Houston Airport System) Domestic Passengers International Passengers Landings and Takeoffs Air Freight (metric tons) Enplaned Deplaned CONSUMERS New Car and Truck Sales (Units, Houston MSA) Cars Trucks, SUVs and Commercials Total Retail Sales ($000,000, Houston MSA, NAICS Basis) Consumer Price Index for All Urban Consumers ('82-'84=100) Houston-Galveston-Brazoria CMSA United States Hotel Performance (Harris County) Occupancy (%) Average Room Rate ($) Revenue Per Available Room ($) POSTINGS AND FORECLOSURES Postings (Harris County) Foreclosures (Harris County) Jan '13 Jan '13 Jan '13 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 Dec '12 2Q12 Dec '12 Dec '12 3Q12 3Q12 3Q12 Dec '12 Dec '12 MONTHLY DATA Most Recent 1,756 94.37 3.33 54.6 3,989,149 768,785,000 281,909,000 486,876,000 358,109,439 261,510,838 92,005,167 169,505,671 96,598,601 82,305,044 14,293,557 6,055 172,500 33,554 2,731,000 522,300 2,208,700 6.0 6.0 7.6 3,472,829 4,156,790 3,410,635 746,155 63,405 35,182 17,250 17,932 25,456 10,800 14,656 25,809 202.477 229.601 64.3 90.09 57.90 2,061 678 Year % Earlier Change 2,003 99.47 2.66 57.8 4,017,421 794,474,000 358,182,000 436,292,000 331,128,164 195,334,931 64,003,147 131,331,784 135,793,233 118,530,457 17,262,776 5,381 160,000 42,083 2,646,500 492,500 2,154,000 7.2 7.1 8.3 3,515,641 4,311,108 3,542,815 768,293 69,401 36,955 18,439 18,516 19,986 8,099 11,887 24,595 200.477 225.672 57.9 85.94 49.76 4,338 1,169 -1.2 -3.6 -3.7 -2.9 -8.6 -4.8 -6.4 -3.2 27.4 33.3 23.3 4.9 1.0 1.7 -12.3 -5.1 25.2 -5.5 -0.7 -3.2 -21.3 11.6 8.1 33.9 43.8 29.1 -28.9 -30.6 -17.2 12.5 7.8 -20.3 3.2 6.1 2.5 YEAR-TO-DATE TOTAL or YTD AVERAGE* Most Recent 1,756 * 94.37 * 3.33 * 58.9 * 51,188,914 10,690,348,000 3,689,000,000 7,001,348,000 4,857,134,531 3,084,749,715 1,268,209,156 1,816,540,559 1,772,384,816 1,528,801,469 243,583,347 74,682 162,775 * 40,497 * 2,681,883 * 509,050 * 2,172,833 * 6.8 * 6.8 * 8.1 * 43,808,039 50,329,002 41,564,457 8,764,545 812,237 419,306 216,396 202,910 325,088 143,061 182,027 50,442 204.214 * 229.594 * 66.5 * 94.22 * 62.68 * 34,730 9,993 Year Earlier 2,003 * 99.47 * 2.66 * 60.0 * 51,527,823 8,971,138,000 3,647,348,000 5,323,790,000 3,653,176,019 2,429,652,877 1,021,522,318 1,408,130,559 1,223,523,142 1,010,457,924 213,065,218 63,606 153,618 * 48,800 * 2,599,064 * 486,242 * 2,106,883 * 8.1 * 7.1 * 8.3 * 42,476,178 50,030,744 41,393,412 8,637,332 854,222 423,761 217,302 206,459 254,996 107,552 147,444 46,984 200.496 * 224.939 * 60.3 * 90.85 * 54.86 * 43,832 11,092 3.1 0.6 0.4 1.5 -4.9 -1.1 -0.4 -1.7 27.5 33.0 23.5 7.4 1.9 2.1 % Change -12.3 -5.1 25.2 -1.8 -0.7 19.2 1.1 31.5 33.0 27.0 24.1 29.0 44.9 51.3 14.3 17.4 6.0 -17.0 3.2 4.7 3.1

4.8 16.4 -52.5 -42.0

3.7 14.3 -20.8 -9.9

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HOUSTONTHE ECONOMY AT A GLANCE


Sources Rig Count Spot WTI, Spot Natural Gas Houston Purchasing Managers Index Electricity Building Construction Contracts City of Houston Building Permits MLS Data Employment, Unemployment

Baker Hughes Incorporated U.S. Energy Information Admin. National Association of Purchasing Management Houston, Inc. CenterPoint Energy McGraw-Hill Construction Building Permit Department, City of Houston Houston Association of Realtors Texas Workforce Commission

Port Shipments Aviation Car and Truck Sales Retail Sales Consumer Price Index Hotels Postings, Foreclosures

Port of Houston Authority Aviation Department, City of Houston TexAuto Facts Report, InfoNation, Inc., Sugar Land TX Texas Comptrollers Office U.S. Bureau of Labor Statistics PKF Consulting/Hospitality Asset Advisors International Foreclosure Information & Listing Service

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2012, Greater Houston Partnership

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HOUSTONTHE ECONOMY AT A GLANCE


HOUSTON MSA NONFARM PAYROLL EMPLOYMENT (000)
Dec '12 Total Nonfarm Payroll Jobs Total Private Goods Producing Service Providing Private Service Providing Mining and Logging Oil & Gas Extraction Support Activities for Mining Construction Manufacturing Durable Goods Manufacturing Nondurable Goods Manufacturing Wholesale Trade Retail Trade Transportation, Warehousing and Utilities Utilities Air Transportation Truck Transportation Pipeline Transportation Information Telecommunications Finance & Insurance Real Estate & Rental and Leasing Professional & Business Services Professional, Scientific & Technical Services Legal Services Accounting, Tax Preparation, Bookkeeping Architectural, Engineering & Related Services Computer Systems Design & Related Services Admin & Support/Waste Mgt & Remediation Administrative & Support Services Employment Services Educational Services Health Care & Social Assistance Arts, Entertainment & Recreation Accommodation & Food Services Other Services Government Federal Government State Government State Government Educational Services Local Government Local Government Educational Services SOURCE: Texas Workforce Commission 2,731.0 2,357.1 522.3 2,208.7 1,834.8 97.3 53.8 41.2 186.5 238.5 161.6 76.9 140.1 293.6 128.2 17.3 19.1 23.5 11.0 31.3 15.7 90.9 48.3 387.3 184.7 23.6 17.5 59.5 27.0 181.2 170.6 79.5 44.1 305.7 26.4 238.0 100.9 373.9 27.5 73.2 39.5 273.2 193.1 Nov '12 2,725.8 2,350.4 519.7 2,206.1 1,830.7 96.5 53.4 40.7 185.7 237.5 160.8 76.7 141.7 289.0 127.3 17.3 19.2 23.6 10.8 31.4 15.6 91.5 48.6 385.9 183.2 23.3 17.0 59.9 26.8 181.7 171.7 80.2 44.5 305.5 27.6 236.7 101.0 375.4 27.2 73.9 40.1 274.3 193.8 Dec '11 2,646.5 2,270.6 492.5 2,154.0 1,778.1 92.8 50.8 39.6 168.9 230.8 153.0 77.8 137.0 281.7 124.8 16.5 19.8 22.5 10.7 31.5 15.8 91.5 48.8 390.2 189.3 23.4 18.2 63.2 25.8 179.6 170.1 72.9 44.0 287.0 25.3 220.6 95.7 375.9 27.5 72.4 39.4 276.0 192.7 Change from Nov '12 Dec '11 5.2 6.7 2.6 2.6 4.1 0.8 0.4 0.5 0.8 1.0 0.8 0.2 -1.6 4.6 0.9 0.0 -0.1 -0.1 0.2 -0.1 0.1 -0.6 -0.3 1.4 1.5 0.3 0.5 -0.4 0.2 -0.5 -1.1 -0.7 -0.4 0.2 -1.2 1.3 -0.1 -1.5 0.3 -0.7 -0.6 -1.1 -0.7 84.5 86.5 29.8 54.7 56.7 4.5 3.0 1.6 17.6 7.7 8.6 -0.9 3.1 11.9 3.4 0.8 -0.7 1.0 0.3 -0.2 -0.1 -0.6 -0.5 -2.9 -4.6 0.2 -0.7 -3.7 1.2 1.6 0.5 6.6 0.1 18.7 1.1 17.4 5.2 -2.0 0.0 0.8 0.1 -2.8 0.4 % Change from Nov '12 Dec '11 0.2 0.3 0.5 0.1 0.2 0.8 0.7 1.2 0.4 0.4 0.5 0.3 -1.1 1.6 0.7 0.0 -0.5 -0.4 1.9 -0.3 0.6 -0.7 -0.6 0.4 0.8 1.3 2.9 -0.7 0.7 -0.3 -0.6 -0.9 -0.9 0.1 -4.3 0.5 -0.1 -0.4 1.1 -0.9 -1.5 -0.4 -0.4 3.2 3.8 6.1 2.5 3.2 4.8 5.9 4.0 10.4 3.3 5.6 -1.2 2.3 4.2 2.7 4.8 -3.5 4.4 2.8 -0.6 -0.6 -0.7 -1.0 -0.7 -2.4 0.9 -3.8 -5.9 4.7 0.9 0.3 9.1 0.2 6.5 4.3 7.9 5.4 -0.5 0.0 1.1 0.3 -1.0 0.2

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HOUSTONTHE ECONOMY AT A GLANCE

PURCHASING MANAGERS INDEX


HOUSTON & U.S. 2002-2012

70

65

60

55

50

45

40

35

30 Jan-02

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09
U.S.

Jan-10

Jan-11

Jan-12

Jan-13

HOUSTON

Source: National Association for Purchasing Management - Houston, Inc.

HOUSTON MSA EMPLOYMENT


2002-2012
2,800 2,750 2,700 2,650 160 140 120 100 80

NONFARM PAYROLL EMPLOYMENT (000)

2,600 2,550 2,500 2,450 2,400

40 20

2,350 2,300 2,250 2,200 2,150 2,100 2,050 2,000 1,950 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09
JOBS

0 -20 -40 -60 -80 -100 -120 Jan-13

Jan-10

Jan-11

Jan-12

12-MONTH CHANGE

Source: Texas Workforce Commission

February 2013

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12-MONTH CHANGE (000)

60

HOUSTONTHE ECONOMY AT A GLANCE


GOODS-PRODUCING AND SERVICE-PROVIDING EMPLOYMENT
HOUSTON MSA 2002-2012
550 540 530 520 2,250 2,200 2,150 2,100 2,050 2,000 500 1,950 490 1,900 480 1,850 470 460 450 440 430 Jan-02 1,800 1,750 1,700 1,650 1,600 Jan-13

GOODS-PRODUCING (000)

510

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09

Jan-10

Jan-11

Jan-12

GOODS-PRODUCING JOBS

SERVICE-PROVIDING JOBS

Source: Texas Workforce Commission

UNEMPLOYMENT RATE
HOUSTON & U.S. 2002-2012
11 10 9 8

PERCENT OF LABOR FORCE

7 6 5 4 3 2 1 0 Jan-02

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07
HOUSTON

Jan-08
U.S.

Jan-09

Jan-10

Jan-11

Jan-12

Jan-13

Source: Texas Workforce Commission

February 2013

2012, Greater Houston Partnership

Page 13

SERVICE-PROVIDING (000)

HOUSTONTHE ECONOMY AT A GLANCE

SPOT MARKET ENERGY PRICES


2002-2012
140 28

120

24

100

20

80

16

60

12

40

20

0 Jan-02

Jan-03

Jan-04
WTI Monthly

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09

Jan-10

Jan-11
GAS 12-MO AVG

Jan-12

0 Jan-13

WTI 12-MO AVG

GAS MONTHLY

Source: U.S. Energy Information Administration

INFLATION: 12-MONTH CHANGE


2002-2012
6%

5%

4%

3%

2%

1%

0%

-1%

-2%

-3% Jan-02

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09
U.S. CPI-U

Jan-10

Jan-11

Jan-12

Jan-13

HOUSTON CPI-U

Source: U.S. Bureau of Labor Statistics

February 2013

2012, Greater Houston Partnership

Page 14

HENRY HUB NATURAL GAS ($/MMBTU)

WEST TEXAS INTERMEDIATE ($/BBL)