HOUSTON - Falling oil prices have cost at least 300,000 people their jobs in the last two years.
However, now those prices have hit a seven-month high. Does that mean the oil industry in on the mend?
Because so many local jobs depend on the oil industry, Houston is one of a few places where rising pump prices are considered a good thing.
Houston’s average is currently $1.98 per gallon of regular gas, up 10 cents in a month, which is a direct result of oil. It is now selling for $48 a barrel, double its $24 rock bottom last year.
“As hard as it is to celebrate when you're paying for the gasoline, it is actually relatively good news for the average person in the Houston economy,” explained Adam Perdue, research economist at the Institute for Regional Forecasting at the University of Houston's C. T. Bauer College of Business. “We lost a lot of jobs, probably somewhere between (50,000) and 70,000 jobs.”
Although Perdue says we’re heading in the right direction, he warns the oil woes aren’t over.
“We are going to lose…maybe about 10,000 jobs this year in the Houston economy," he said.
According to Perdue, we won’t see these jobs return for at least another year or two when oil hits $60 to $70 a barrel. However, despite the jobs lost, Houston added jobs last year.
“We have a huge petrochemical boom on the east side and the south side of town where we are adding about $50 billion in chemical plants," Perdue said.
A large chunk of the new jobs are thanks to construction -- not so much homes or small businesses but the petrochemical companies. Once the construction is complete, however, the Houston area could lose an additional 20,000 to 30,000 jobs.
“So, in the short term it's going to be a little bit scary,” Perdue said. "But in the mid- to long-term, Houston will be able to recover.”
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