H-Town Man Posted February 24, 2008 Share Posted February 24, 2008 Interesting article in the Chronicle:http://www.chron.com/disp/story.mpl/business/5564021.htmlThe gist is that since we're not as dependent on oil as we used to be, we'll no longer experience an economic boom when oil prices soar. This paragraph is aggravating:"In New York, their presumption is that Houston is bursting at the seams," said local economic guru Barton Smith, who heads the University of Houston's Institute for Regional Forecasting. "But we're not growing as fast as Phoenix or Atlanta, or even Dallas or Austin. People ask how that can be with $95-a-barrel oil. We're a different economy."Okay, so what exactly will it take for us to grow as fast as Phoenix or Atlanta, or even Dallas or Austin? Not $100 oil prices apparently. What then? Link to comment Share on other sites More sharing options...
Mister X Posted February 24, 2008 Share Posted February 24, 2008 I found that article more reassuring than discouraging. Sure, big booms are nice, but there is only one sure thing about a big boom - there will eventually be a big bust (at least by comparison). Living and surviving one is enuf for me. Houston is growing more like how DFW was growing in the 70s, slower, but more steady. When oil collapsed in the 80s, it hurt DFW too, but not enuf to damage their image as it did in Houston. I'm fine with the way Houston is growing today. Like the article said, it's a more 'sophisticated' kind of growth. That boom in the 70's had Houston developers acting like teenagers, thinking that they were completely invincible and spending like there was no tomorrow. Then we all found out the hard way that there was a price to pay for such shortsightedness. It's always nice to hear that Houston outdoes Dallas in anything, but I'm not particularly worried that there are other cities growing faster than Houston AT THE MOMENT. As long as the economy stays as healthy as it has been in the last 10 years in Houston, I don't think there is much to complain about - except maybe that the new towers going up don't seem to be as tall as they were in the 70's boom. Yet. Link to comment Share on other sites More sharing options...
citykid09 Posted February 25, 2008 Share Posted February 25, 2008 They need to get more positive writers at the Chronicle. Talkin' bout Houston isn't growing as fast as all of these other cities when its growing 3rd fastest nationwide. Maybe they mean its not growing as fast building wise, because I could see their case there. Austin, Dallas & Atlanta are booming building wise. But on the other hand Houston is starting a lot of new projects. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 They need to get more positive writers at the Chronicle. Talkin' bout Houston isn't growing as fast as all of these other cities when its growing 3rd fastest nationwide. Maybe they mean its not growing as fast building wise, because I could see their case there. Austin, Dallas & Atlanta are booming building wise. But on the other hand Houston is starting a lot of new projects.We aren't growing as fast in percentage terms as Austin, Atlanta, or Phoenix (and we're actually growing slightly faster than DFW at the moment) but numerically, we are only slightly behind DFW in employment and population growth. Link to comment Share on other sites More sharing options...
crunchtastic Posted February 25, 2008 Share Posted February 25, 2008 We aren't growing as fast in percentage terms as Austin, Atlanta, or Phoenix (and we're actually growing slightly faster than DFW at the moment) but numerically, we are only slightly behind DFW in employment and population growth.What contributes to Phoenix's continued growth? Companies continue to relocate? All I know of are call centers. An endless supply of snowbirds? I have heard of middle-class Canadians buying older condo stock in Arizona-- weakness of the dollar, soft housing market, etc. Interested in what drives growth there. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 What contributes to Phoenix's continued growth? Companies continue to relocate? All I know of are call centers. An endless supply of snowbirds? I have heard of middle-class Canadians buying older condo stock in Arizona-- weakness of the dollar, soft housing market, etc. Interested in what drives growth there.Phoenix is similar to Las Vegas but without gambling. Both pick up on firms seeking to serve California without being subject to California regulations. That's probably the best thing that Phoenix has going for it. Both are attractive to snowbirds, both have hot dry climates with plenty of sunny days and cool nights.Phoenix is benefited by the weak dollar on account of that it has a fair bit of exposure to tech and aerospace, industries where the U.S. has a comparative advantage, but they've been hurt pretty badly as a result of overbuilding of for-sale homes and excessive home price speculation. Link to comment Share on other sites More sharing options...
BryanS Posted February 25, 2008 Share Posted February 25, 2008 Interesting article in the Chronicle:http://www.chron.com/disp/story.mpl/business/5564021.htmlThe gist is that since we're not as dependent on oil as we used to be, we'll no longer experience an economic boom when oil prices soar. This paragraph is aggravating:Okay, so what exactly will it take for us to grow as fast as Phoenix or Atlanta, or even Dallas or Austin? Not $100 oil prices apparently. What then?Location, location, location (which we can do nothing about). When you edge out Lake Jackson, Baytown, and New Orleans, in terms of where people want to live (location-wise), you've got a big problem. Just my opinion... Link to comment Share on other sites More sharing options...
Mister X Posted February 25, 2008 Share Posted February 25, 2008 Right, we've got a real 'big' problem. Adding a mere 100,000 new residents per year is just not enough. We're practically living in a ghost town. What ever shall we do! Link to comment Share on other sites More sharing options...
BryanS Posted February 25, 2008 Share Posted February 25, 2008 Right, we've got a real 'big' problem. Adding a mere 100,000 new residents per year is just not enough. We're practically living in a ghost town. What ever shall we do! Quality, not quantity. And I bet if you ask many of those 100K new residents, why they moved here, they would say their job. Houston just does not have the same Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 Location, location, location (which we can do nothing about). When you edge out Lake Jackson, Baytown, and New Orleans, in terms of where people want to live (location-wise), you've got a big problem. Just my opinion...Actually, Lake Jackson and Baytown are part of our Metropolitan Statistical Area. We don't edge them out; we are they.And Mister X is correct: nobody would live here if they didn't want to. There is nobody forcing people's decisions. If people want to live here because the jobs are good and because the relative cost of living is low, those are perfectly valid reasons which we shouldn't take for granted. Link to comment Share on other sites More sharing options...
Mister X Posted February 25, 2008 Share Posted February 25, 2008 Quality, not quantity. And I bet if you ask many of those 100K new residents, why they moved here, they would say their job. Houston just does not have the same “coolness factor” as many of those other cities (Atlanta, Chicago, Austin, Seattle, etc.) Not that being cool matters (well, it does in August around here)…Yet they come anyway. I bet a lot of those people would say that it's so 'cool' to have a job, so that probably makes Houston cool enuf for them. But, there must something more than just jobs keeping people coming here and staying here. Las Vegas has lots of jobs and is unquestionably 'cooler' and more fun than Houston - one would think that anyone who didn't feel that Houston was 'cool' enuf for them would just go there and be 'happy'.I don't think it makes Houston look bad at all if people moved here because a good job or a career brought them here, instead of 'coolness'. Coolness can go bust quicker than an overbuilt, one-trick pony driven economy.Quality is pretty subjective. I like my big house and big back yard. I would never have had this kind of quality back in San Francisco. Although I must admit, here in Houston I never get the pleasure of being asked for change from a homeless person the moment I walk out of my house, on a daily basis. Link to comment Share on other sites More sharing options...
Houston19514 Posted February 25, 2008 Share Posted February 25, 2008 We aren't growing as fast in percentage terms as Austin, Atlanta, or Phoenix (and we're actually growing slightly faster than DFW at the moment) but numerically, we are only slightly behind DFW in employment and population growth.Not sure about employment growth, but I believe the most recent census estimates show Houston growing faster than DFW both numerically and percentage-wise. Likewise, I'm pretty sure they show Houston growing faster numerically than both Atlanta and Phoenix (and no doubt Austin).IMO the Chron needs to find themselves a new economic analyst to turn to. Link to comment Share on other sites More sharing options...
H-Town Man Posted February 25, 2008 Author Share Posted February 25, 2008 Barton Smith was the analyst, and he's pretty much the reigning economics expert on Houston. My guess is that he was talking about percentages, and that with Dallas, he was thinking of how it's been for the most part the last two decades. Link to comment Share on other sites More sharing options...
jgriff Posted February 25, 2008 Share Posted February 25, 2008 It may not be like the 80s but we are definitley in an Energy Boom right now. One of the main things keeping it from getting even bigger is a lack of workforce. There just isn't enough petrochem talent in Houston to keep up with the amount of work out there. The amount of money coming through Houston's petrochem businesses is staggering. Projects that cost $70mil 5 years aog are now $350mil. There are multiple projects out there that are getting close to $10bil. My boss has been in the business for 47 years and he says he's never seen it like this.If this ended right now the West side of Houston would be a ghost town. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 Not sure about employment growth, but I believe the most recent census estimates show Houston growing faster than DFW both numerically and percentage-wise. Likewise, I'm pretty sure they show Houston growing faster numerically than both Atlanta and Phoenix (and no doubt Austin).IMO the Chron needs to find themselves a new economic analyst to turn to.They really just need to hire better reporters and editors. It was not at all clear what Bart was using as a measure of growth or what time period he was referring to, and if tracking stats like these weren't a professional obligation of mine, I probably wouldn't know whether he was talking about numerical or percentage forms of growth.A good reporter/editor would seek to use more precise language. It's not as though the guy is at all difficult to reach for clarification...and I know from personal experience that if he has the opportunity to clarify, he figgin' clarifies.It may not be like the 80s but we are definitley in an Energy Boom right now. One of the main things keeping it from getting even bigger is a lack of workforce. There just isn't enough petrochem talent in Houston to keep up with the amount of work out there.I've heard this several times from different economists and energy execs speaking at events. In the words of many, the only single thing that really puts a constraint on Houston's growth is a shortage of professional, skilled, and semi-skilled labor equiped with the knowledge to function in the energy industry. The problem is compounded by the energy workforce tends to be much older than the non-energy workforce, and are retiring at a disproportionate rate. Link to comment Share on other sites More sharing options...
jgriff Posted February 25, 2008 Share Posted February 25, 2008 I've heard this several times from different economists and energy execs speaking at events. In the words of many, the only single thing that really puts a constraint on Houston's growth is a shortage of professional, skilled, and semi-skilled labor equiped with the knowledge to function in the energy industry. The problem is compounded by the energy workforce tends to be much older than the non-energy workforce, and are retiring at a disproportionate rate.I think the problem was caused by the big bust of the 80s. The oil companies got rid of everyone. The refinery where my dad worked had 5000 people when he started and 800 left when he retired. No one went into the business for 20 years. Now all we have left are guys that are 55+ and 20 something college grads, there's a new guy on my job that is 80 years old. The oil compaines worked so hard for the last 20 years to keep prices low that they destroyed their workforce. Now we're paying for all those years of cheap gas prices. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 I think the problem was caused by the big bust of the 80s. The oil companies got rid of everyone. The refinery where my dad worked had 5000 people when he started and 800 left when he retired. No one went into the business for 20 years. Now all we have left are guys that are 55+ and 20 something college grads, there's a new guy on my job that is 80 years old. The oil compaines worked so hard for the last 20 years to keep prices low that they destroyed their workforce. Now we're paying for all those years of cheap gas prices.Refinery operations have tended to have relatively little variability in employment that is attributable to the refining margins, and in fact refining (like most other forms of manufacturing) has become more capital-intensive and less labor-intensive over the last several decades, resulting in a slow hemmorage of jobs.The bulk of refinery-related employment that expands or contracts has to do with major capital expansion programs. The good news is that Houston gets a lot of engineering and energy finance jobs that can be done from office buildings far-removed from the actual project, so refinery expansions all over the world create employment here. The bad news is that if refining margins go south, these people get laid off pretty quick.The much larger employment push right now, though, is in upstream energy. Link to comment Share on other sites More sharing options...
ricco67 Posted February 25, 2008 Share Posted February 25, 2008 I'm not really worried about the "B-Word" anymore, as someone said, our economy is totally different from the 80's. The only real thing that is holding development, and I hear this almost constantly now from people that looking at Houston to move into to is how far behind we are in transit for being the size of city we are and its incredible as to what kind of preconceptions they have of our city. It's not something that the Convention and travel Bureau (or whatever it is called) can fix with some nifty (read: lame) ads. There is something fundamentally wrong on how people percieve Houston. I don't know if its the cowboy movies, the terrible movies, or what. But people can't get over the "hick" factor that Houston seems to have. While talking to a few people last night, I found it absolutely unforgivable on how some businesses downtown don't stay open/change their hours when a major event comes to Houston. The Helicopter convention has brought 15,000 people in to Downtown and I had to struggle to find a place for them to eat early on a saturday and sunday afternoon for a quick snack.Sorry, I was ranting.. Link to comment Share on other sites More sharing options...
jgriff Posted February 25, 2008 Share Posted February 25, 2008 The bulk of refinery-related employment that expands or contracts has to do with major capital expansion programs. The good news is that Houston gets a lot of engineering and energy finance jobs that can be done from office buildings far-removed from the actual project, so refinery expansions all over the world create employment here.The bad news is that those projects can also be done from India. They don't have the expertise yet but they are fast learners and we're handing all our technology to them. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 The bad news is that those projects can also be done from India. They don't have the expertise yet but they are fast learners and we're handing all our technology to them.Those jobs wouldn't go to India if we actually had people that could do the jobs...even if those people were paid considerably more. According to studies done by urban economists on what they call "economies of localization", professions related to engineering and specifically to the energy industry benefit the most out of any kinds of jobs by those jobs being clustered in a single city. Houston is that city.Relying on labor from other parts of the world is a major sacrifice for the corporations, but they're doing what they have to to make projects happen. If we adjusted our educational infrastructure to provide for these kinds of positions or made our immigration laws more friendly to productive people that want to come here, a lot of our problems would be solved...but neither of those are going to be politically popular, especially given that they aren't looking to do any favors for oil/gas/coal producers.The only real thing that is holding development, and I hear this almost constantly now from people that looking at Houston to move into to is how far behind we are in transit for being the size of city we are and its incredible as to what kind of preconceptions they have of our city. It's not something that the Convention and travel Bureau (or whatever it is called) can fix with some nifty (read: lame) ads. There is something fundamentally wrong on how people percieve Houston. I don't know if its the cowboy movies, the terrible movies, or what. But people can't get over the "hick" factor that Houston seems to have. While talking to a few people last night, I found it absolutely unforgivable on how some businesses downtown don't stay open/change their hours when a major event comes to Houston. The Helicopter convention has brought 15,000 people in to Downtown and I had to struggle to find a place for them to eat early on a saturday and sunday afternoon for a quick snack.People that care so much about coolness are the most likely to do irrepairable harm to our local economy by voting for politicians that will stifle it. Their priorities are totally messed up. They have little concept of how the world actually works. We should do absolutely nothing to try to attract them. Link to comment Share on other sites More sharing options...
KimberlySayWhat Posted February 25, 2008 Share Posted February 25, 2008 I don't know if its the cowboy movies, the terrible movies, or what. But people can't get over the "hick" factor that Houston seems to have. I see that is the perception of Texas as a whole from the outsiders, not soley Houston. Maybe it's my imagination but it seems cities such as San Antonio and Dallas embrace those old cowboys and spurs images more than Houston or Austin. To people outside of Texas, we're all the same. This weekend I was watching the movie "Ordinary People" and there's a scene where Mary Tyler Moore and Donald Sutherland's characters are on a airplane to Houston to visit Beth's (played by MTM) brother and there were two guys sitting behind them with with big 10-gallon cowboy hats. I rolled my eyes, but at the same time found it amusing. I mean it's laughable. From what I understand "Ordinary People" has always been a highly regarded film, but it doesn't seem to matter to Hollywood, granted this movie is about 25 years old. Though the couple of scenes that actually took place in Houston were about golf and country clubs so I think that redeemed it a little for me. Link to comment Share on other sites More sharing options...
KatieDidIt Posted February 25, 2008 Share Posted February 25, 2008 If this ended right now the West side of Houston would be a ghost town.I disagree. West Houston is growing for more reasons than just oil. A bust may cause a hiccup, but nothing like the 80s. Houston's population and demand for real estate is just too huge now.1. Anything inside the Beltway along the Memorial corridor all the way into downtown is pretty much out of 98% of the populations reach. The areas just outside the Beltway are still in an outstanding school district and the values are what inside the Beltway was 5 years ago.2. People are moving in from the satellite suburbs. The commutes are becoming too long as Houston packs in. These little neighborhoods in West Houston are the closest things to the suburbs. Most people inside the Loop think we are the suburbs. And we are, just urban suburban.3. The new little medical center that starting to build out here is pulling in staff and doctors to reside.4. The tech industry is setting up shop in the region. Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 4. The tech industry is setting up shop in the region.Cite examples please. Link to comment Share on other sites More sharing options...
jgriff Posted February 25, 2008 Share Posted February 25, 2008 Relying on labor from other parts of the world is a major sacrifice for the corporations, but they're doing what they have to to make projects happen.Your posts are always interesting and well-informed niche...I wouldn't call the outsourcing of the engineering business a sacrifice though. I've been heavily involved with it for many years now and the one thing that drives it is cost. It is simply a tool to keep labor costs down. There is less motivation for people in the U.S. to go into businesses that are being outsourced, that causes the labor pool to shrink. Many people in the engineering business have left it because of the outsourcing, that's one of the reasons we have a shortage of talent today. I have many friends who have left to start a small business or new career, they aren't coming back now even though there is big money to be made.I don't think there is anything we can do about this though. The economic imbalance between the U.S. and India is what causes it. The only solution is to end that imbalance. If we don't outsource then the petrochem engineering companies will just leave the U.S. altogether and go where the cheap labor is. Link to comment Share on other sites More sharing options...
jgriff Posted February 25, 2008 Share Posted February 25, 2008 Cite examples please.The only big one I know of is BMC. From what I hear they are not doing that well. They keep having layoffs. Edit: Microsoft has an office in the BMC complex also. Link to comment Share on other sites More sharing options...
BryanS Posted February 25, 2008 Share Posted February 25, 2008 Those jobs wouldn't go to India if we actually had people that could do the jobs...even if those people were paid considerably more. According to studies done by urban economists on what they call "economies of localization", professions related to engineering and specifically to the energy industry benefit the most out of any kinds of jobs by those jobs being clustered in a single city. Houston is that city.Relying on labor from other parts of the world is a major sacrifice for the corporations, but they're doing what they have to to make projects happen. If we adjusted our educational infrastructure to provide for these kinds of positions or made our immigration laws more friendly to productive people that want to come here, a lot of our problems would be solved...but neither of those are going to be politically popular, especially given that they aren't looking to do any favors for oil/gas/coal producers.People that care so much about coolness are the most likely to do irrepairable harm to our local economy by voting for politicians that will stifle it. Their priorities are totally messed up. They have little concept of how the world actually works. We should do absolutely nothing to try to attract them.There's nothing that can be done, unless you can dig up this city and move it 200 miles west or north. Our location has us sunk (good for ships, not for people). There's a reason your big house and big yard is so cheap - because given the choice among other cities, and looking at the bigger work-life balance picture, your proximity to the nasty, humid Gulf of Mexico, people choose other places (yea, so 100K a year come here, but other 'nicer' places are growing faster - and there's a reason for it). The economics of working and residing in Houston works out well, but we're lacking in too many other departments (not to mention the weather is crappy here 50% of the time, regardless of the time of year!).No amount of "coolness" or trying to be cool or electing politicians who would be as foolish to think they can change our image is going to change that, and I certainly wasn't advocating that position - and anyone who told me they were going to make Houston "a cool place to live," I wouldn't vote for simply because I don't believe in the principal of putting lipstick on pigs. Houston is what it is: a large, sprawling city that is a good place to work, but low on the list of places to live. Link to comment Share on other sites More sharing options...
MidtownCoog Posted February 25, 2008 Share Posted February 25, 2008 There's nothing that can be done, unless you can dig up this city and move it 200 miles west or north. Our location has us sunk (good for ships, not for people). Houston's location is not good for people? That's just asinine. Your post makes you sound like the man less traveled. Link to comment Share on other sites More sharing options...
BryanS Posted February 25, 2008 Share Posted February 25, 2008 Houston's location is not good for people? That's just asinine. Your post makes you sound like the man less traveled.Houston's location, relative to other locations, is not the best. There are worse, and there are more that are better... and I know that... because I have traveled. =) Link to comment Share on other sites More sharing options...
TheNiche Posted February 25, 2008 Share Posted February 25, 2008 Your posts are always interesting and well-informed niche...I wouldn't call the outsourcing of the engineering business a sacrifice though. I've been heavily involved with it for many years now and the one thing that drives it is cost. It is simply a tool to keep labor costs down. There is less motivation for people in the U.S. to go into businesses that are being outsourced, that causes the labor pool to shrink. Many people in the engineering business have left it because of the outsourcing, that's one of the reasons we have a shortage of talent today. I have many friends who have left to start a small business or new career, they aren't coming back now even though there is big money to be made.I don't think there is anything we can do about this though. The economic imbalance between the U.S. and India is what causes it. The only solution is to end that imbalance. If we don't outsource then the petrochem engineering companies will just leave the U.S. altogether and go where the cheap labor is.There are certain types of employment within the energy sector that have been aggressively outsourced. One example is accounting. An aunt of mine lost her job at Shell for just that reason...they moved her whole department to the Philipennes. But GAAP accounting methods are much easier to teach than is engineering, and it is utilized in such a variety of industries that labor is relatively interchangable and also ubiquitously available in major labor markets.Engineering (especially in oil & gas) is different because within the whole of the field are finely-honed specialties for which there are few schools. This is why energy firms chose Houston over New Orleans, Tulsa, Chicago, NYC, etc. It was an HR decision that was self-reinforcing. If they could actually find sufficient engineering talent locally, they'd hire them. Just think of all the bonuses that have been given not only to the new hires, but to those that referred them. They're desperate for qualified American engineers.If they have to go to India, that really is a sacrifice. The labor may be cheap, but there are a lot of problems with going multinational. Firstly is bringing together a team of qualified persons that are presently geographically scattered (there isn't a labor market similar to Houston in India). Language, culture, travel, expats, tax implications, currency risk, law, lawlessness, war risk, and political risk come to mind at other complicating factors...I'm sure there are others. Link to comment Share on other sites More sharing options...
Gary Posted February 25, 2008 Share Posted February 25, 2008 Houston's location, relative to other locations, is not the best. There are worse, and there are more that are better... and I know that... because I have traveled. =)You talk about heat and humidity but fail to mention 2 of the most poplar tourist cities in the nation (NO & Miami) having the same problem.I get soooo tired of listening to those that moan and groan about Houston and it's lack of amenities, topography, etc. This city is very desirable for millions, including myself who has traveled this country for years. I have a beach, I have architecture, I have great food, I have a wonderful home that would cost me a fortune in most cities, I've got virtually every athletic team available, and those venues are all of 7 miles from one another. I've got fishing in both fresh and saltwater, I've got 75 degree days right now while many in the Norths more desirable cities are miserable, I've got great live music, etc, etc....In short, What Coog said. This is "Asinine" Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.