Fall 2018 Symposium
Tuesday, November 6, 2018
"Houston's Economy in 2019: Sorting Out the Right Path Forward as Growth Returns"
Featuring: Robert W. Gilmer, Ph.D.
Director, Institute for Regional Forecasting
Event Details
Hyatt Regency Hotel (Imperial Ballroom), 1200 Louisiana, Houston, Texas 77002 (Map)
Tuesday, November 6, 2018
Registration/Name Badge
pickup: 11 a.m.
Luncheon & Presentation:
11:30 a.m. - 1:30 p.m.
Registration closed today at noon, November 5. If you are not registered and would like to attend, there will be a few seats available for sale at the door for $140/seat (please see special assistance table in lobby of hotel). Name badge pick up will begin in the lobby of the hotel at 11 a.m. Your name badge will contain your name, your company name (if given to us) and the table number you are assigned to. We ask that everyone be in their seat by 11:30 a.m. for lunch to be served. The program will conclude around 1:30 p.m. Valet parking is available at the hotel, self-parking is available in the Regency Garage, and the 1400 Louisiana parking garage (entrance off Bell).
Houston’s economy made a clear turn for the better in early 2018, finally shaking off the hangover from the last oil price decline. The current track seems to be one of moderate growth, with prospects of a continued solid economic performance – as long as oil prices and the U.S. economy hold near their current track.
Untangling exactly where the local economy stands today is almost as challenging as asking where it might be headed. An unprecedented series of events have pulled Houston in different directions: Super Bowl, World Series, Hurricane Harvey, a failed OPEC accord in 2017, and one that finally stuck in 2018. As new data come in, and as revisions are made, we seem to be emerging onto a two-percent growth path for employment, or the 60-65,000 jobs annually that is typical of Houston for the last 25 years.
A late-cycle stimulus package from Congress has finally shaken the U.S. economy out of its post-Great Recession doldrums. This is great news, but it also could present the Federal Reserve with real challenges as labor markets tighten further. The current path for short-term interest rates has the Federal Reserve taking a neutral stance on monetary policy by next spring – neither providing stimulus nor tightening. But too strong an economy could mean higher interest rates and – for the first time in a decade -- real risks to the national business cycle.
Oil prices have returned to a moderate level near $65 per barrel, led by OPEC’s firm clamp on production levels. Meanwhile U.S. oil production continues to rise rapidly, despite pipeline capacity and equipment shortage. Oil politics keep markets balanced – Iran sanctions, the collapse of Venezuela, wars in the Middle east. The key oil question for Houston: How fast can oil jobs return? So far, the numbers fail to show the classic V-shaped recovery expected after a major decline. After losing over 73,000 jobs in 2015-16, only 14,000 returned by summer. Why so slow?
Meanwhile, Houston’s real estate community is generally well-situated to take advantage of Houston’s nascent expansion. Residential, industrial, and retail sectors all coped well with the downturn; apartments were moderately over-built; only office faces serious issues in the recovery. For the office sector, the missing oil workers are an essential part of any hope for improved occupancy.