Unemployment and Jobs in Houston

Strong job and industry growth are essential to increasing economic opportunity and security for all Houstonians

Despite job losses and economic disruptions caused by the pandemic, Houston’s three-county region has had strong job and industry growth over the last decade.

The data

Houston-area unemployment rates peaked in 2020 but fell to near-pre-pandemic levels in 2022

The unemployment rate measures the share of workers in the labor force who do not currently have a job but are actively looking for work. The level of unemployment is a general measure of how the overall economy is operating, and changes in the rate can be an important signal of changes in the labor market and economy.

In 2022, the unemployment rate in Harris County (4.2%) was highest in Houston’s three-county region, while the unemployment rate was 3.9% in Fort Bend and Montgomery counties. In 2010, unemployment rates in Fort Bend and Montgomery counties were at a 30-year high and steadily declined to a two-decade low in 2019. Of course, unemployment rates spiked in 2020 — the result of pandemic-related job losses. Since then, unemployment rates have declined for two consecutive years, though they remain slightly higher in 2022 compared to pre-pandemic levels. Unemployment in Harris County followed a similar pattern, except the unemployment rate in 2020 was higher than in 2010.

Job growth in Houston’s three-county region is positive after pandemic losses

Job growth is an important measure of economic expansion and the overall strength of the job market. It is a leading indicator of the health of the economy since strong job growth indicates a healthier economy.

The COVID-19 pandemic severely affected job availability in the U.S, resulting in a 3.1% drop in available jobs, which was more than 7 times the job loss experienced during the Great Recession in 2010. However, despite the pandemic, Fort Bend and Montgomery counties continued to experience job growth in 2020, while Harris County — along with Texas and the U.S — experienced job loss. Recovery began in 2021, exceeding gains made in 2019.

Between 2010 and 2021, the number of jobs grew 72% in Fort Bend, 23% in Harris, and 58% in Montgomery counties, compared to 16% in the nation and 28% in Texas overall.

Industries in Houston see steady, consistent growth

Texas and Houston’s three-county area continue to be a place of business opportunity and growth. According to the Greater Houston Partnership, which provides economic data and analysis for the nine-county Houston-The Woodlands-Sugar Land Metropolitan Statistical Area (Houston MSA), found that the region ranks third in the number of Fortune 500 headquarters, and Texas has ranked first on the list of best performing states for economic development for 10 consecutive years in 2022.

Between 2010 and 2022, Houston’s three-county region saw the greatest growth in businesses in the following industries: professional and business services, education and health services, and trade, transportation and utilities.Growth in Houston-area businesses has occurred in each of the three counties, with Fort Bend and Montgomery counties experiencing the fastest businesses growth — mirroring their rapid population growth. While it may appear that Harris County business growth has slowed, the lower growth rates are more a reflection of a large, existing set of businesses already in Harris County, and so while growth continues for the county, its relative growth is smaller compared to its rapidly-growing neighbors. 

Fort Bend County has doubled the number of business establishments between 2010 and 2022, with the greatest growth in professional and business services (130% increase), education and health services (122% increase), and trade, transportation and utilities (85% increase).

In Harris County, the number of establishments increased by 26% from 2010 to 2022 — a slower growth rate given the volume in the third most populous county in the nation. Among the largest three industries, establishments in education and health services grew the most (61% increase), followed by professional and business services (34%), and trade, transportation and utilities (17%).

The number of establishments in Montgomery County grew by 72% between 2010 and 2022. Among the largest three industries, establishments in education and health services grew the most (103%), followed by professional and business services (86%), and trade, transportation and utilities (46%).

The top Houston-area job is in office and administrative support

The type of work people do, or occupational mix, is important to understanding the economy of a region. Changes in occupation often reflects business innovations. When a business adopts new technology, produces new products, or makes other changes to its processes, doing so usually causes changes in occupational mix. For example, if a factory automates, the number of production workers usually declines, while the number of engineers increases.²

There have been five major shifts in the occupational mix in U.S. history: the decline of agricultural employment (1870 to 1970), the rise of office work (1870 to 1970), the decline of manual labor (1940 to 1970), the decline of production work (1950 to 2010), and the rise of management (1970 to 2005).³

The top Houston-area job in each county is in office and administrative support, and while the counties share commonalities in occupational mix, there are notable differences. In Fort Bend County, most people are employed as office and administrative support (12%), educational instruction (11%), food prep and serving (11%), sales (11%) and transportation/warehouse (10%). In Harris County, most residents are employed as office and administrative support (13%) and transportation/warehouse (10%), reflecting the significance of trade in Houston — which is a major distribution center for the nation and globe, as the port of Houston is the top foreign trading port in the U.S. by weight. In Montgomery County, most workers are employed as office and administrative support (13%), food prep and serving (11%), and sales (10%).

About half of Houston-area jobs pay more than $40,000 annually

Availability of jobs is crucial, but it is equally important that those jobs offer fair and livable wages. The Census categorizes jobs as low-wage (i.e., jobs that pay $15,000 or less annually), medium-wage, and high-wage, with “high-wage” jobs being any work that earns more than $40,000 annually. An individual earning more than $40,000 annually is living above the Federal Poverty Line, however, they are not earning enough to actually make ends meet given the line’s rudimentary determination.

Based on the Census definition, nearly half of jobs (49%) in the three-county area are “high-wage” positions, in that they pay more than $40,000 annually. When comparing across the three-counties, Harris County has the largest percentage of residents working in a high-wage job (55%) compared to Fort Bend County (44%) and Montgomery County (47%). Between 2005 and 2019, the number of “high-wage” jobs increased 170% in Fort Bend, 91% in Harris, and 240% in Montgomery counties and 115% in Texas overall.

About 21% of the three-county area residents are in low-wage jobs, and are figuring out how to make ends meet while earning $1,250 a month ($15,000 or less annually). About 24% of workers in Fort Bend County, 22% in Montgomery County, and 18% in Harris County are in low-wage jobs. This means that 1 in 4 workers in the region work at least 40 hours a week, yet bring home less than $1,250 a month.