The Economy in Houston
Take a closer look at the Houston economy and its current state of employment, tourism, industry strength, and expectations for the future.
The Houston economy is enjoying good growth and a decrease in unemployment.
Driving industries in Houston are the energy, healthcare, and aerospace sectors.
The average salary in Houston is $51,830, making it one of the best places to live in America.
Houston’s economic forecast is positive, with a predicted total GDP increase of at least 1.7% by 2024.
A financial advisor can help you make the best decisions that take advantage of the economic opportunities in Houston.
Understanding the Houston economy
The city of Houston is ranked as one of the best metros to live in Texas, listed just under Dallas for income per household and quality of life. Having seemingly recovered from the pandemic, Houston is known for its economic opportunities, diverse community, and strong oil and gas industries.
Understanding the economy in your city is important when it comes to managing personal finances. The more you know about the American economy where you live, the easier it becomes to make smart financial decisions – something that can be further enhanced by working with a financial advisor.
Employment in Houston is stable, and there’s a low unemployment rate and a healthy tourism scene, with the latter bringing in $17 billion per annum and 120,000 jobs in total. The Houstonian average yearly income is $51,830, earning it a spot on Business Insider’s list of Best Places to Live in America if You Want to Make Money 2023, as it surpasses many other states.
What is the main industry driving the Houston economy?
The biggest industry driving the economy and employment in Houston, Texas, relates to energy, especially oil and gas. There are over 5,000 energy firms doing business locally. In 2023, gasoline and petroleum wholesaling generated $298.1 billion, oil drilling and gas extraction $210.9 billion, and petroleum refining $170.2 billion.
There are also strong healthcare, aerospace, and biomedical research industries, all of which greatly benefit the economy in Houston, Texas.
What are the positives of the Houston economy?
Houston’s economy, for the most part, is pretty strong and is continuously growing thanks to the brand it is creating for itself. There are many positive elements of the economy that bring more value to the city, including more job opportunities, increased GDP, and more:
The employment rate is growing; Unemployment rates decreased by 3.9% in the last year, recovering a total of 145% of jobs lost during the pandemic
The energy sector is gaining strength: According to the EIA, natural gas prices fell by 23% in 2023
GDP is in recovery mode: Houston’s GDP between 2022 and 2023 has grown by 3.4%, placing it in the top 20 of America’s highest-earning metros
Racial diversity: Houston’s racial diversity is almost twice as high as the national average
What are the underlying issues in the Houston economy?
Just like every big city, Houston does experience ongoing issues that have been prevalent as drawbacks to the city’s economy.
The three biggest issues that the economy in Houston, Texas, faces in 2023 relate to clustered unemployment, limited industrial diversity, and poverty. Let’s take a closer look:
Decrease in industrial diversity: Houston is best known for its oil and gas industries, which tend to dominate the market and make it difficult for other industries to gain momentum.
Unemployment issues: Despite Houston's decreasing unemployment rates, there are still hundreds of thousands of Houstonians without work, and most of them struggle to break out of their situation due to a lack of education and skills.
Stuck in a cycle of intergenerational poverty: Houston has the highest poverty rate among America’s biggest metros. It also has the highest child poverty rate at 20.8% in 2023.
The future of Houston’s economy
Economies are prone to change, whether in a city, state, or country. For the most part, Houston’s economy looks to enjoy continual growth. Houston economy forecasts project a total GDP increase of at least 1.7% by 2024.
To keep up with the growth, Houston will need to continue lowering the employment rate as more young people enter the job market. Education rates and upskilling will also be needed to stabilize the economy and welcome new growth.
The bottom line
Houston’s economy is regaining necessary strength after the chaos of COVID-19 and is seeing higher employment rates than most other metros across the US.
Learning more about your local economy is one of the best ways to take advantage of it. But you can further improve your personal financial situation by getting Unbiased to match you with a financial advisor who can provide expert advice on savings, investments, and more.
Senior Content Writer
Rachel is a Senior Content Writer at Unbiased. She has nearly a decade of experience writing and producing content across a range of different sectors.