Economy effects on Houston job market. (Dallas, Spring: high schools, budget, teachers)

[Supermac34]

I think people are forgetting that current oil prices were at these levels as recently as 2007 and the economy was really strong.

I think that oil might drop some more, but anything above $40 or so keeps the job market in Houston pretty stable. Most long term projects in the oil companies have $20-30 price points factored in. You might see some of the deep sea stuff slow down or get cancelled, but what about when oil is right back to $75-100 in 1-3 years?

[JL]

that is a cautious uncertainty about oil going back to $100/barrel. The oil companies will be ok, but that doesn't mean there won't be layoffs. If change is what Obama meant, you will see more for wind, solar, nuclear, etc.

[Supermac34]

Well, we have to make plastics, right? And industrial chemicals? And our planes and ships still need to drive around? You'll still need heating oil and propane, and we'll still probably need to use asphalt to pave roads.

I hate to break it to you, but oil is still the most cost effecient way to do things. I hope we invest in alternate energy sources, I really do, but which companies will be in the best position to invest in those energy sources? Perhaps energy companies? How long will it take to switch dependence? 10 years? 50 years? 100 years? I think I read an article today that said if a viable and quickly recharged electric car was put on the market TODAY, it would take 30 to 40 years to switch the market off gas.

I think the biggest sign that Houston's economy would be decent was the 90s. Oil was LOW. In 1998 oil was down to $12 a barrel. Think about that. Imagine the panic if oil was $12 a barrel right now. The inflation adjusted price is still only $15. Energy companies hurt, that's how we got Exxon Mobile, and BP as huge as they are, they merged and bought out each other. They had learned from the 80s how to cope and survive and come out stronger. Yet, despite all that, the Houston economy was still pretty decent, perhaps a little slow, but decent.

Not to mention that the Houston economy is greatly diversified compared to the 80s.

And about the $100 a barrel, OK, maybe $70 or $80. You mention Obama, that's great if he invests in alternates, but unfortunately, he's not the President of China, India, Russia, etc. You must be forgetting that oil is a GLOBAL commodity. Its not just used in the US. In fact, one of the major factors of the drive up of price was the GLOBAL demand, especially in China and India. They are huge users of oil and will only use MORE in the coming years. For the strides that their countries have taken they still have a long way to go, and as the world comes out of the global recession, they're growth will start again. It is entirely possible that some day China will be the number one user of oil in the world, but these Houston companies will have no problem selling it to them, and it possible larger quanities that they currently sell in total now. Sorry, but oil isn't going away soon, probably not in your lifetime.

Also don't forget that almost 30% of the huge prices in oil were due to a weakened dollar. Remember, oil is a global commodity pegged to the US dollar, as its value fluctuates, so does the price of oil. A much stronger dollar has probably knocked $20 off a barrel in the last month. As the world economy stabilized in the next year or two, the dollar will tick down and the oil value will tick right back up.

[Jamesww]

Oil was driven up by speculators that had no better place to put their money as both real estate and stocks were on a skid. The demand for oil has not fallen nearly as much as the price has recently. I have been telling everyone I know that oil was getting way over priced since last Jan. India and China will not be having increases in demand if the U.S. falters.

At $50 a barrel pretty much every project planned by local companies is still viable. Meaning that it would be highly unlikely that we would see any lay offs. At $40 a barrel several projects will get scrapped which would lead to some lay offs but things would not be to bad. Below $25 a barrel and Houston joins the rest of the states in pain. Below $15 and Houston wold be hurting worse than anywhere but Michigan or New York.

[CherryMagic]

to desertsun -

I find it rather humourous you have that kind of judgemental mentality. I am not "fat-headed" as you so implied. Don't be so asinine.

I stand by my original post. Have a great day.

[chris_ut]

There are a lot of people in here making comments who have no idea how the oil industry operates.

[JL]

Originally Posted by Supermac34

Well, we have to make plastics, right? And industrial chemicals? And our planes and ships still need to drive around? You'll still need heating oil and propane, and we'll still probably need to use asphalt to pave roads.

I hate to break it to you, but oil is still the most cost effecient way to do things. I hope we invest in alternate energy sources, I really do, but which companies will be in the best position to invest in those energy sources? Perhaps energy companies? How long will it take to switch dependence? 10 years? 50 years? 100 years? I think I read an article today that said if a viable and quickly recharged electric car was put on the market TODAY, it would take 30 to 40 years to switch the market off gas.

I think the biggest sign that Houston's economy would be decent was the 90s. Oil was LOW. In 1998 oil was down to $12 a barrel. Think about that. Imagine the panic if oil was $12 a barrel right now. The inflation adjusted price is still only $15. Energy companies hurt, that's how we got Exxon Mobile, and BP as huge as they are, they merged and bought out each other. They had learned from the 80s how to cope and survive and come out stronger. Yet, despite all that, the Houston economy was still pretty decent, perhaps a little slow, but decent.

Not to mention that the Houston economy is greatly diversified compared to the 80s.

And about the $100 a barrel, OK, maybe $70 or $80. You mention Obama, that's great if he invests in alternates, but unfortunately, he's not the President of China, India, Russia, etc. You must be forgetting that oil is a GLOBAL commodity. Its not just used in the US. In fact, one of the major factors of the drive up of price was the GLOBAL demand, especially in China and India. They are huge users of oil and will only use MORE in the coming years. For the strides that their countries have taken they still have a long way to go, and as the world comes out of the global recession, they're growth will start again. It is entirely possible that some day China will be the number one user of oil in the world, but these Houston companies will have no problem selling it to them, and it possible larger quanities that they currently sell in total now. Sorry, but oil isn't going away soon, probably not in your lifetime.

Also don't forget that almost 30% of the huge prices in oil were due to a weakened dollar. Remember, oil is a global commodity pegged to the US dollar, as its value fluctuates, so does the price of oil. A much stronger dollar has probably knocked $20 off a barrel in the last month. As the world economy stabilized in the next year or two, the dollar will tick down and the oil value will tick right back up.

Yes, you make interesting points which i agree. I just think these other countries might also look at alternative resources besides oil. Who knows, they might be looking to change seeing the dependence of oil and predicament the U.S is in, thus not wanting to end up being in that situation years from now. Don't get me wrong, oil still is needed for plastics, etc. but i don't see it going over $100 anymore with the direction Obama is going in and i believe he might have a great influence on other world leaders. The oil companies will still do well even if oil drops significantly, but there will be that 'pessimissm' about the local Houston economy with them deciding to layoff, etc.

Just remember, technology changes fast. What doesn't look so appealing today, could be so appealing soon. I do think that in order for innovation or effort to find alternative resources, we need oil and gas prices to go through the roof. Otherwise, people are happy now with lower gas prices and that could mean no incentive for innovation, etc. It will take time, but i'd say in 10-15 yrs, our dependence on oil will be much less than it is now, even globally.

[coog78]

Many companies in Houston are instating hiring freezes. Some of the refinery plants have announced layoffs and are currently ongoing. Although the market here is of course better than New York (you guys are an epicenter of our failed banking institutions, Wall Street manipulators, and retail failures), I would not start packing up and heading to Houston in hopes of job security. If layoffs did start, new hires are the first to go.

[Jammie]

What is the current unemployment rate in Houston~not Tx. as a whole. Anyone have the Oct. figures?

I ask because our economy up here has been doing well, BUT there have been a few lay-offs this month.

[Supermac34]

My wife's uncle works at a chemical plant near the Edna/Inez area and they are experiencing labor shortages. They can't find enough people and are paying something like $28/hour out of high school to start training.