Coronavirus-caused closures have resulted in a nearly 30 percent drop in the county's daily economic output, according to a new report. Getty Images

Houston's economy continues to suffer as a result of the coronavirus-fueled economic slide and the collapse in oil prices. But just how much are these twin crises injuring Bayou City?

Economic data and forecasts present an increasingly grim outlook for Houston.

A new Moody's Analytics analysis commissioned by the Wall Street Journal provides one measurement of the economic damage being inflicted on Houston. The analysis, published April 2, indicates business closures in Harris County — which represents two-thirds of the region's population — have caused a 27 percent drop in the county's daily economic output.

Ed Hirs, an economics lecturer at the University of Houston, says the 27 percent figure is likely lower than the actual number. He thinks it's closer to 50 percent.

"The reason is that we are talking about output — actual work getting done — and not including monetary transfers from the bailout bill or unemployment insurance," Hirs says.

The lingering daily decline undoubtedly will bring down the Houston area's total economic output for 2020. In 2018, the region's economic output (GDP) added up to nearly $478.8 billion. By comparison, the 2018 economic output for the nation of Austria totaled $455.3 billion, according to the World Bank.

Harris County ranks as the third largest county in the U.S., as measured by population. The Moody's Analytics study shows the country's two largest counties — Los Angeles County in California and Cook County in Illinois — have been hit with even bigger decreases in daily economic output. Los Angeles County's loss sits at 35 percent, with Cook County's at 30 percent.

Patrick Jankowski, senior vice president of research at the Greater Houston Partnership, says in a podcast interview published April 2 that it's difficult to accurately gauge how the economic climate is hurting Houston right now. That's because economic data lags present-day economic reality.

"The situation is changing daily," Jankowski says. "There's so many unknowns out there. This is unprecedented."

Economists predict the Houston area's workforce will see massive losses as a result of the coronavirus and energy downturns.

Economist Bill Gilmer, director of the Institute for Regional Forecasting at the University of Houston's Bauer College of Business, says a moderate recession could siphon as many as 44,000 jobs from the region's economy by the end of this year. A more dire forecast from The Perryman Group, a Waco-based economic analysis firm, envisions the Houston area losing nearly 256,000 jobs due to the COVID-19 shutdown and racking up $27 billion in coronavirus-related economic losses.

Jankowski anticipates the Houston area tallying job losses of at least 200,000, meaning losses would be less severe than the 1980s energy bust but more severe than the Great Recession.

"If we're still working from home after May, everyone's job is at risk," says Jankowski, adding that this would trigger more furloughs, layoffs, and pay cuts.

Aggravating Houston's situation is the coronavirus clampdown on restaurants and hotels.

According to survey data released March 30 by the Texas Restaurant Association, 2 percent of the state's more than 50,000 restaurants already had closed permanently, and another 32 percent had closed temporarily. An additional 12 percent of Texas restaurants anticipated shutting down within the next 30 days.

If you add the 2 percent of restaurants that have closed to the 12 percent that expect to close, that would equal roughly 7,000 shuttered restaurants.

"Restaurants are in a fight for survival. The statistics from this survey provide a mere snapshot of the extreme economic impact the COVID-19 crisis is having on one of the most important industries in Texas," Emily Williams Knight, president and CEO of the Texas Restaurant Association, says in a release.

In the lodging sector, Texas is projected to lose 44 percent of its jobs, or more than 64,000 positions, according to a mid-March forecast from the American Hotel & Lodging Association. Experts predict some Texas hotels won't survive the coronavirus crisis.

"COVID-19 has been especially devastating for the hotel industry. Every day, more hotels are closing, and more employees are out of a job," Chip Rogers, president and CEO of the hotel association, says in a March 26 release.

While the restaurant and hotel sectors face a shaky future, the energy industry is grappling with the oil war between Russia and Saudi Arabia as well as depressed demand for crude oil and gasoline. Jankowski says gas prices could stay low through mid-2020 or even the end of 2020 as the energy industry copes with a prolonged oil glut.

Relief funds coming from Washington, D.C., will help stabilize the energy sector and other industries, Jankowski says, but will not "juice" the economy and spark growth.

"We're going to need to move beyond the pandemic," he says, "and we're going to need for some consumer confidence and business confidence to come back before we start to see growth returning again."

For the second decade in a row, Houston could have the second highest number of new residents for any metro area. Photo by DenisTangneyJr/Getty Images

Houston expects to see huge population surge this decade, study says

incoming

Brace yourselves, Houston. Following a decade of eye-popping population growth, Houston is expected in this decade to once again lead the nation's metro areas for the number of new residents.

New data from commercial real estate services company Cushman & Wakefield shows Houston gained 1,284,268 residents from 2010 through 2019. In terms of the number of new residents tallied during the past decade, Houston ranked second among U.S. metro areas, the data indicates.

From 2020 through 2029, Houston is projected to tack on another 1,242,781 residents, Cushman & Wakefield says. For the second decade in a row, that would be the second highest number of new residents for any metro area, the company says. That's around the number of people who live in the Louisville, Kentucky, metro area.

For Houston, the 2020-29 forecast would represent a population growth rate of 17.2 percent, down from 21.6 percent for 2010 through 2019, Cushman & Wakefield says.

As of July 2018, the Census Bureau estimated the Houston area was home to nearly 7 million people, making it the country's fifth largest metro. If the Cushman & Wakefield projection is correct, the metro population would easily exceed 8 million by the end of 2029.

The outlook is based on data from Moody's Analytics and the U.S. Census Bureau. The company published its findings January 7. The outlook takes into account a metro area's birth and death rates, along with the number of people moving into and out of an area.

The forecast indicates Houston won't be alone among Texas metro areas in terms of rolling out the welcome mat for lots of new residents.

Dallas-Fort Worth is expected to once again lead the nation's metro areas for the number of new residents. DFW gained 1,349,378 residents from 2010 through 2019, ranking first among U.S. metro areas for the number of new residents.

From 2020 through 2029, DFW is projected to tack on another 1,393,623 residents. That would be the highest number of new residents for any metro area for the second decade in a row.

The 2020-29 forecast would represent a population growth rate of 17.9 percent, down from 20.9 percent for 2010 through 2019, Cushman & Wakefield says.

As of July 2018, an estimated 7,539,711 people lived in DFW, making it the country's fourth largest metro. Under the Cushman & Wakefield scenario, DFW's population would swell to about 9 million by the time the calendar flips to 2030.

Austin, meanwhile, is projected to retain its No. 9 ranking for headcount growth among U.S. metro areas, according to Cushman & Wakefield. The company says the Austin area added 549,141 residents from 2010 through 2019. From 2020 through 2029, another 602,811 residents are on tap. At that pace, the Austin area is on track to have roughly 2.9 million residents at the outset of the next decade.

Cushman & Wakefield envisions a 26.5 percent population growth rate for the Austin area from 2020 through 2029, down from 31.8 percent in 2010-19.

The Cushman & Wakefield report doesn't include figures for the San Antonio metro area.

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This article originally ran on CultureMap.

Texas was named the second best state for business by Forbes, and Oxford Economics predicted Houston's economic growth to be more significant over the next few years than most other major metros. Getty Images

Texas recognized as second best state for business, while Houston expected to see key economic growth

Feathers for our cap

Houston and the rest of Texas received two early Christmas presents signaling that their economies continue to percolate.

In a report released December 23, economic forecasting and analysis firm Oxford Economics predicted Houston and Dallas-Fort Worth will enjoy a greater share of economic growth through 2023 than any other mega-metro area in the U.S. except San Francisco.

Meanwhile, Forbes magazine declared on December 19 that Texas is the second best state for business, behind only North Carolina. Texas previously sat in the No. 3 spot on the Forbes list, preceded by North Carolina and Utah.

Through 2023, Oxford Economics forecasts average compound GDP growth of 2.4 percent in Houston and Dallas-Fort Worth. Among the country's 10 biggest metro areas, only the projection for San Francisco is higher (2.7 percent).

For Houston, the 2.4 percent figure would be an improvement over recent economic performance. From 2014 to 2018, the region's GDP growth rate was 1 percent, while it was 1.5 percent for 2015-19. In the 2020-21 timeframe, the growth rate for Houston is expected to be 1.9 percent.

In a recent forecast, the Greater Houston Partnership envisions the Houston area adding 42,300 jobs in 2020, mostly outside the energy sector. Among the region's top-performing sectors in 2020 will be healthcare, government, food services, and construction, the partnership says. Meanwhile, the energy, retail, and information sectors are expected to shrink.

In November, Robert Gilmer of the University of Houston's Institute for Regional Forecasting explained that by the end of 2022, job losses in the oil industry should have a limited effect on the region's economy. Still, he anticipates Houston's job growth through 2024 will be "moderate and just below trend."

In forecasting strong economic growth for Houston and DFW, Oxford Economics says the "industrial structures" of the two regions "are not exceptional, but low costs and low regulation mean that the industries that they do have grow faster than elsewhere."

"San Francisco's very high costs are creating affordability problems and rising inequalities that may eventually undermine its model," Oxford Economics adds. "Competitive advantages never last forever. The Sunbelt cities [including Houston and DFW] may yet give it a run for its money."

Houston's and DFW's competitive advantages mesh with those of the entire state. Texas' high points include lower taxes, lower labor expenses, lower cost of living, and low levels of regulation, Oxford Economics says.

As noted by Forbes, Moody's Analytics predicts Texas businesses will add close to 1 million new jobs by 2023, which would be the third highest average annual job growth rate among the states. Meanwhile, the share of Texans who launched businesses last year was the fourth highest in the country, according to Kauffman Foundation data cited by Forbes. And just three states — California, New York and Washington — saw more venture capital flow into them in 2018 and 2019 than Texas did, according to PwC.

Texas earned these rankings on the Forbes list:

  • No. 1 state for growth prospects
  • No. 1 state for business costs
  • No. 4 state for economic climate
  • No. 10 state for labor supply
  • No. 15 state for quality of life
  • No. 21 state for regulatory environment
In his 2019 State of the State address, Gov. Greg Abbott praised Texas as "the most powerful state in America," thanks in part to healthy job growth, low unemployment, and rising wages. "Texas is the premier economic destination in the United States," he said.
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CultureMap Emails are Awesome

Houston doctor wins NIH grant to test virtual reality for ICU delirium

Virtual healing

Think of it like a reverse version of The Matrix. A person wakes up in a hospital bed and gets plugged into a virtual reality game world in order to heal.

While it may sound far-fetched, Dr. Hina Faisal, a Houston Methodist critical care specialist in the Department of Surgery, was recently awarded a $242,000 grant from the National Institute of Health to test the effects of VR games on patients coming out of major surgery in the intensive care unit (ICU).

The five-year study will focus on older patients using mental stimulation techniques to reduce incidences of delirium. The award comes courtesy of the National Institute on Aging K76 Paul B. Beeson Emerging Leaders Career Development Award in Aging.

“As the population of older adults continues to grow, the need for effective, scalable interventions to prevent postoperative complications like delirium is more important than ever,” Faisal said in a news release.

ICU delirium is a serious condition that can lead to major complications and even death. Roughly 87 percent of patients who undergo major surgery involving intubation will experience some form of delirium coming out of anesthesia. Causes can range from infection to drug reactions. While many cases are mild, prolonged ICU delirium may prevent a patient from following medical advice or even cause them to hurt themselves.

Using VR games to treat delirium is a rapidly emerging and exciting branch of medicine. Studies show that VR games can help promote mental activity, memory and cognitive function. However, the full benefits are currently unknown as studies have been hampered by small patient populations.

Faisal believes that half of all ICU delirium cases are preventable through VR treatment. Currently, a general lack of knowledge and resources has been holding back the advancement of the treatment.

Hopefully, the work of Faisal in one of the busiest medical cities in the world can alleviate that problem as she spends the next half-decade plugging patients into games to aid in their healing.

Houston scientists develop breakthrough AI-driven process to design, decode genetic circuits

biotech breakthrough

Researchers at Rice University have developed an innovative process that uses artificial intelligence to better understand complex genetic circuits.

A study, published in the journal Nature, shows how the new technique, known as “Combining Long- and Short-range Sequencing to Investigate Genetic Complexity,” or CLASSIC, can generate and test millions of DNA designs at the same time, which, according to Rice.

The work was led by Rice’s Caleb Bashor, deputy director for the Rice Synthetic Biology Institute and member of the Ken Kennedy Institute. Bashor has been working with Kshitij Rai and Ronan O’Connell, co-first authors on the study, on the CLASSIC for over four years, according to a news release.

“Our work is the first demonstration that you can use AI for designing these circuits,” Bashor said in the release.

Genetic circuits program cells to perform specific functions. Finding the circuit that matches a desired function or performance "can be like looking for a needle in a haystack," Bashor explained. This work looked to find a solution to this long-standing challenge in synthetic biology.

First, the team developed a library of proof-of-concept genetic circuits. It then pooled the circuits and inserted them into human cells. Next, they used long-read and short-read DNA sequencing to create "a master map" that linked each circuit to how it performed.

The data was then used to train AI and machine learning models to analyze circuits and make accurate predictions for how untested circuits might perform.

“We end up with measurements for a lot of the possible designs but not all of them, and that is where building the (machine learning) model comes in,” O’Connell explained in the release. “We use the data to train a model that can understand this landscape and predict things we were not able to generate data on.”

Ultimately, the researchers believe the circuit characterization and AI-driven understanding can speed up synthetic biology, lead to faster development of biotechnology and potentially support more cell-based therapy breakthroughs by shedding new light on how gene circuits behave, according to Rice.

“We think AI/ML-driven design is the future of synthetic biology,” Bashor added in the release. “As we collect more data using CLASSIC, we can train more complex models to make predictions for how to design even more sophisticated and useful cellular biotechnology.”

The team at Rice also worked with Pankaj Mehta’s group in the department of physics at Boston University and Todd Treangen’s group in Rice’s computer science department. Research was supported by the National Institutes of Health, Office of Naval Research, the Robert J. Kleberg Jr. and Helen C. Kleberg Foundation, the American Heart Association, National Library of Medicine, the National Science Foundation, Rice’s Ken Kennedy Institute and the Rice Institute of Synthetic Biology.

James Collins, a biomedical engineer at MIT who helped establish synthetic biology as a field, added that CLASSIC is a new, defining milestone.

“Twenty-five years ago, those early circuits showed that we could program living cells, but they were built one at a time, each requiring months of tuning,” said Collins, who was one of the inventors of the toggle switch. “Bashor and colleagues have now delivered a transformative leap: CLASSIC brings high-throughput engineering to gene circuit design, allowing exploration of combinatorial spaces that were previously out of reach. Their platform doesn’t just accelerate the design-build-test-learn cycle; it redefines its scale, marking a new era of data-driven synthetic biology.”