When global oil prices fell roughly 70% between mid-2014 and early 2016, Houston’s energy-dependent economy experienced a severe shock. Core drivers of economic mobility — including hiring rates, earnings growth, job-to-job mobility and regional migration — suffered disruptions that still linger a decade later.
This report shows how far the region’s economy fell behind by analyzing labor and income data from 2009 to 2019, extended through 2024 to assess long-term persistence. Houston’s performance was compared to a group of 54 similar large metro areas with little to no oil and gas dependence. Figures in this report reflect changes relative to the control group rather than raw numbers.
This report is the first of a three-part series analyzing regional economic mobility and proposing ways for expanding opportunity.
Key findings
- Houston’s economy lost significant ground after the oil crash and has fallen behind its peers.
- Relative to the control group, per-resident income was about 13% lower and private employment was about 7% lower on average from 2015 to 2019.
- In 2019 alone, Houston had roughly 240,000 fewer private-sector jobs than the comparison implies it would have had, as existing worksites cut positions rather than closing down.
- Goods-producing industries lost about 15% of their jobs relative to the control group in 2019, while services lost about 4%.
- The damage to individuals came through hiring, pay, and job turnover, the everyday building blocks of economic mobility.
- Continuing workers and new hires earned roughly 10% and 12% less, respectively, between 2015 and 2019.
- Hiring slowed, especially for young workers ages 19-24, and more workers were pushed into persistent joblessness.
- The population adjusted with fewer people moving to Houston rather than a surge of people leaving.
The oil shock illustrates how global economic shifts can profoundly affect opportunities for Houstonians. As the global energy industry continues to evolve, this report raises important questions for leaders about the region’s economic vulnerabilities and its ability to adapt to future changes.
