1. Presented by Jenny Philip, Manager of Economic Research Greater Houston Partnership Houston’s Economic Outlook Presented by Patrick Jankowski, Vice President Research Greater Houston Partnership

2. The Recession and Recovery Cliffs Notes Version

3. Recession and Recovery Nonfarm Payroll Employment - Houston MSA* UnadjustedAdjusted Jobs Lost152,800116,900 Source: Texas Workforce Commission * Through August

4. Recession and Recovery Nonfarm Payroll Employment - Houston MSA* UnadjustedAdjusted Jobs Lost152,800116,900 % Jobs Lost5.8%4.5% Source: Texas Workforce Commission * Through August

5. Recession and Recovery Nonfarm Payroll Employment - Houston MSA* UnadjustedAdjusted Jobs Lost152,800116,900 % Jobs Lost5.8%4.5% Jobs Recovered*207,400189,600 Source: Texas Workforce Commission * Through August

6. Recession and Recovery Nonfarm Payroll Employment - Houston MSA* UnadjustedAdjusted Jobs Lost152,800116,900 % Jobs Lost5.8%4.5% Jobs Recovered*207,400189,600 % Recovered*135.7%162.2% Source: Texas Workforce Commission * Through August

7. Now you know enough to pass.

8. Houston vs. The Competition

9. Percent of jobs recovered through Aug ’12 Houston vs. Top 10 Metros Source: U.S. Bureau of Labor Statistics 100%

10. Percent of jobs recovered through Aug ’12 Houston vs. Top 10 Metros Source: U.S. Bureau of Labor Statistics 162.2% 117.0% 101.5% 82.0% 62.5% 35.0% 29.4% 26.7% 24.6% 21.5%

11. Percent of jobs recovered through Aug ’12 Houston vs. Second 10 Metros Source: U.S. Bureau of Labor Statistics 162.2% 55.1% 61.4% 55.0% 43.1% 43.5% 34.2% 31.6% 18.7% 23.1% 21.8%

12. In the competition among U.S. metros for job creation?

13. Houston has already won the super bowl.

14. So what makes Houston hot? UsThem

15. Houston never had a housing bubble.

16. No Housing Bubble Source: GHP calculations based on National Association of Homebuilders data * Median-priced home divided by median household income for each metro area.

17. No Housing Bubble Source: GHP calculations based on National Association of Homebuilders data *Years of Income to Buy a Home, Q1/’06

18. No Housing Bubble Source: GHP calculations based on National Association of Homebuilders data *Years of Income to Buy a Home, Q1/’00 vs ’06

19. No Housing Bubble Source: GHP calculations based on National Association of Homebuilders data *Years of Income to Buy a Home, Q1/’06 vs Q2/’12

20. No Housing Bubble Source: GHP calculations based on National Association of Homebuilders data *Years of Income to Buy a Home, Q1/’00 vs Q1/’06 vs Q2/’12

21. No Housing Bubble No zoning = lower housing costs Market forces determine best use of resources

22. No Housing Bubble – “Large metro areas with the least restrictive zoning have housing cost gaps that are 40 to 63 percentage points lower than metro areas with the most exclusionary zoning.” – Housing Costs, Zoning, and Access to High Performing Schools, Brookings Institute, April 19, 2012

23. Perhaps you’ve seen the headlines?

26. We found shale in our backyard Harris County

28. Shale in our backyard

30. 8,400 corporate jobs added since May ’09 9,100 oil field service jobs added since Nov ’09 7,400 equipment manufacturing jobs added since Nov ’09 So where are we now?

31. WTI Spot Price ($/bbl ) Wednesday close – $90.26 One year ago – $76.40 Three years ago – $69.34 Average over last fifty-two weeks – $95.02 31

32. Forecast Month Issued ’13 Average Barclay’sJuly$115.00 Bank of AmericaJune100.00 J.P Morgan ChaseJune99.00 Deutsche BankJuly96.00 U.S. Energy Information AdministrationAugust90.25 32 WTI Spot Price ($/bbl )

33. Global trade ties

34. Exports as a Percent of Gross Metro Product 10 Most Populous U.S. Metro Areas Metro Area‘05‘10 Houston13.9%20.7% Los Angeles6.68.6 Miami8.614.4 Philadelphia4.36.6 Washington, DC1.72.6 Dallas-Ft Worth6.65.9 Boston6.97.0 New York5.26.8 Atlanta4.55.5 Chicago5.66.4 Global Trade Ties Source: IHS Global Insight

35. Global Trade Ties $ Value, Billions, Houston-Galveston Customs District, Through August Source: U.S. Census Bureau

36. Data does not include trade in services 1,500 firms in Houston’s service sector doing business overseas

37. Jobs Outlook

38. Job Creation -- Forecast vs Actual

42. So where are we now?

43. We’re cool...

44. So where are we now? We’re cool...... and we’re popular.

45. Don’t take my word for it.

48. Houston’s Population Clock

49. The region adds 110,000 residents each year. 65,000 via natural increase i.e., more births than deaths 45,000 via net inmigration i.e., more people moving in than out

50. Houston’s Population Clock Every 5.4 minutes a new Houstonian is born.

51. Houston’s Population Clock Every 15.7 minutes a Houstonian dies.

52. Houston’s Population Clock Every 21.8 minutes someone moves here from overseas.

53. Houston’s Population Clock 24.2 minutes someone moves here from elsewhere in the U.S.

54. Houston’s Population Clock Every 4.8 minutes Houston’s population grows by one resident.

55. Houston’s Population Clock In the hour you’ve spent in this meeting, Houston has added another dozen residents.

56. Presented by Jenny Philip, Manager of Economic Research Greater Houston Partnership Houston’s Economic Outlook Presented by Patrick Jankowski, Vice President Research Greater Houston Partnership