News Summary
Houston’s economy demonstrates resilience despite national uncertainties. Growth, although slower, persists with lower unemployment rates and increased local spending. Challenges in the energy sector and subdued job growth are noted, but sectors like healthcare and retail show positive trends. A favorable business climate and strong housing market bolster the city’s economic outlook.
Texas – Houston’s economy exhibited resilience through the first five months of 2025, experiencing a growth trend despite slowing rates compared to previous years. Payroll employment has witnessed a decrease since the beginning of the year, accompanied by an uptick in initial jobless claims amid a national climate of economic uncertainty.
Reports indicate that although Houston’s unemployment rate remains low, it has encountered challenges, with the Houston Purchasing Managers Index (PMI) signaling a slowdown in economic activity. The area has seen a decline in job creation, with a total of 29,600 jobs added between May 2024 and May 2025; however, total non-farm payroll employment has dipped to 3,471,300 jobs from a record high of 3,479,200 in December 2024. Since the start of the year, Houston has experienced a net loss of 7,900 jobs, a figure expected during the typical seasonal adjustment post-holiday hiring.
Amid these fluctuations, local sales and use tax collections have surged, illustrating robust consumer spending in Houston. In terms of the international trade landscape, the dollar value of exports has decreased, though container volumes at Port Houston have risen, suggesting an increase in activity despite dollar value declines. On the other hand, low oil prices are exerting pressure on the city’s energy sector, contributing to a decline in construction contracts and air travel when compared to the previous year.
Despite the overarching economic challenges, home sales and apartment occupancy rates have improved relative to 2024, indicating a healthy real estate market. Additionally, Houston has seen record-high new vehicle sales, further emphasizing consumer confidence in the local economy. The diverse job growth across sectors reflects varying developments, with hospitality leading in job additions, followed closely by healthcare, and oil and gas extraction.
Projected growth rates for Houston’s economy point toward a GDP increase of 2.2% in 2025, which surpasses the national growth expectation of 1.9%. Among the top 50 U.S. cities, Houston ranks 15th in GDP growth, highlighting the area’s moderate but stable economic development. Neighboring Austin is projected to lead the country with an impressive GDP growth rate of 4.3%.
One notable demographic trend is Houston’s net domestic in-migration of 85,267 individuals in 2024, which has bolstered the region’s consumer base. Houston’s comparatively affordable housing market, where potential homeowners face shorter durations in purchasing median-priced homes relative to cities such as Boston and New York, has further contributed to the region’s allure.
As a business-friendly environment with no state income tax, Texas continues to attract corporate relocations, with Houston ranking third in the nation for relocations in 2023. Although concerns surrounding economic slowdown linger due to national uncertainties, including tariffs and shifting consumer spending patterns, there remains an optimistic outlook for Houston’s economy, particularly in sectors such as healthcare, construction, business services, and retail.
Retail activities are thriving, evidenced by new store openings, including that of luxury home goods retailer Perigold, which cater to the increasing consumer interest. Moreover, Texas state sales tax revenue reached $4.2 billion in May, marking a 4.7% increase compared to the previous year.
In summary, while Houston’s economy faces pressures from various external factors, the city’s ability to maintain job growth in specific sectors alongside solid consumer spending and an attractive housing market continues to provide a level of optimism for the future. As trends develop, monitoring the economic landscape will be crucial for understanding Houston’s position within the broader context of national economic trends.
Deeper Dive: News & Info About This Topic
- The Leader News
- Wikipedia: Economy of Houston
- Houston Chronicle
- Google Search: Houston Economy 2025
- Click2Houston
- Google Scholar: Houston Economy
- Business Alabama
- Encyclopedia Britannica: Houston Economy
- Houston Chronicle
- Google News: Houston Economic Outlook
Author: STAFF HERE COLLEGE WRITER
The COLLEGE STATION STAFF WRITER represents the experienced team at HERECollegeStation.com, your go-to source for actionable local news and information in College Station, Brazos County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Brazos Valley Fair & Rodeo, Chilifest, and Aggie Muster. Our coverage extends to key organizations like the Bryan-College Station Chamber of Commerce and United Way of the Brazos Valley, plus leading businesses in education, biotechnology, and retail that power the local economy such as Texas A&M University, Fujifilm Diosynth Biotechnologies, and H-E-B. As part of the broader HERE network, including HEREAustinTX.com, HEREDallas.com, HEREHouston.com, and HERESanAntonio.com, we provide comprehensive, credible insights into Texas's dynamic landscape.
