Page 7 - NBIZ Magazine December 2020

th
lining is that some Mexican National • While Houston is the 5 largest industry is dealing with low prices,
tourism has returned. Metro area, it was only 8 for Covid- excess supply, declines in drilling,
th
• Texas Medical Center – Covid-19 care 19 job losses. permitting hurdles, and weak overall
continues at a high, but the good Hotels need the driving forces to demand. The energy field lost 25,000
news is that standard medical care return to get hotel demand back on jobs and shut down 690 oil rigs due to
and elective surgeries have returned. track. As the proud Energy Capital of Covid-19. Global oil demand is current-
• Energy Industry – With the oversup- the World, the energy industry is the ly expected to reach pre-pandemic levels
ply of oil, energy remains on hold main driving force for Houston hotel by the end of 2022 with the Houston
until demand returns. demand. Unfortunately, the energy energy industry stabilizing in 2024.
• Convention Industry – Conventions
are currently on hold and will
slowly return in 2021 with new
social distancing requirements,
safety protocols, and reduced atten-
dance due to the fear of in-person
events.
• Sports Events – The events have
returned but the fans have not. Hope-
fully, 2021 will bring back the fans.
• Performing Arts – Entertainment
is gradually returning with limited
in-person attendance and perfor-
mances online.
• Space Exploration – Yippee, we sent
two astronauts into space! This is a
bright spot for the future.
Overall, we are in a holding pattern
until a vaccine is implemented and
business and “non-essential” travel
have the green light.
Return to Pre-Covid Levels
The five-year economic forecast by
Oxford Economics indicates a loss of -3%
in employment and -5% in GMP for Hous-
ton in 2020 with a potential increase
of 1.9% and 5%, respectively, in 2021.
Unemployment increased from 3.8% in
June 2019 to 8.6% in June 2020. Accord-
ing to the Greater Houston Partnership,
Houston lost 350,000 jobs due to
Covid-19, of which only 142,000 (40.7%)
have been recovered as of October. The
Houston hotel industry lost 9,100 jobs
and has only recouped 1,700 (18.7%).
As we search for signs of a Houston
recovery, we find a few glimmers of
hope, as follows:
• The Purchasing Managers Index hit
a new low of 34.6 in April; however,
it rose to 53.4 in September. This
is positive since anything above 45
indicates economic expansion.
• Airport Passenger Activity dropped
90% during April but “recovered” to a
decline of only 61% in September. (We
will take what we can get.)

NBIZ ■ December 2020 7