In a normal year, Houston might create 60,000 to 70,000 jobs, in a boom year, a little over 100,000. A boom is unlikely, however, given the current state of the energy industry. And no one knows what “normal” will look like in a post-COVID world. A full recovery may take several years.

Some industries are already well on the way to recovery. These tend to be sectors where the need for social distancing doesn’t interfere with their ability to conduct business. Sectors which require face-to-face interaction, how-ever, continue to struggle and will be among the last to re-gain all jobs lost in the pandemic. This issue of Glance looks at each sector, examines the damage from the March-April shutdown, and explores how swiftly they may recover.
 

 Energy struggled prior to the pandemic. Crude topped $70 per barrel in October ’18 then began to drift downward. The U.S. rig count peaked at 1,083 in December of ’18. Energy employment plateaued at 238,880 jobs in June of ’19. And drillers sank 16 percent fewer wells last year than in ’18.

Energy’s future doesn’t look bright. Global oil demand won’t return to pre-pandemic levels until ’22, according to separate forecasts by the International Energy Agency (IEA), the U.S. Energy Information Administration (EIA) and the Organization of Petroleum Exporting Countries (OPEC).

A March survey by the Federal Reserve Bank of Dallas found most exploration firms need West Texas Intermediate (WTI) at $49 per barrel or higher to profitably drill a well. EIA doesn’t forecast WTI to reach that level until late in ’21. And Rystad Energy doesn’t see drilling activity returning to last year’s level for at least five years. Additional layoffs are expected as the industry adapts to weak demand and soft prices.

To continue reading this section of Houston: Economy at a Glance, please click the PDF link at the top of the page.