The 13-county Gulf Coast Region covers about 13,900 square miles in eastern coastal Texas, stretching from Huntsville on the north to Matagorda Bay and Galveston along the Gulf Coast. The region has a population density of 580 people per square mile, making it the most densely populated region in the state, with significantly more residents per square mile than the average of 108 people.
The Gulf Coast Region includes one metropolitan statistical area (MSA): the Houston-The Woodlands-Sugar Land MSA, which includes the counties of Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller. Counties in the region not associated with an MSA are Colorado, Matagorda, Walker and Wharton. The economic focus area for the Gulf Coast Region is the city of Houston (Harris County). Houston is the largest city in Texas and the fourth-largest city in the nation. The Houston-The Woodlands-Sugar Land MSA has a population of about 6.9 million.
This report examines regional economic trends including population, personal income, jobs and wages, and education, as well as economic conditions unique to the Gulf Coast Region.
The Gulf Coast Region’s estimated total population in 2017 was more than 7 million, or nearly 25 percent of the state’s total population. This is an increase of about 16 percent (almost 1 million people) since the 2010 census. An estimated 66 percent of the region’s population is concentrated in Harris County. While the Houston-The Woodlands-Sugar Land MSA accounted for almost 98 percent of the region’s population (24 percent of the state), the city of Houston alone accounted for 33 percent of the region (more than 8 percent of the state’s population).
From 2010 to 2017, the region’s population grew at a faster pace than that of the state as a whole (Exhibit 1). While the population of each county in the region increased during this period, Fort Bend and Montgomery outpaced all others, growing by more than 25 percent – more than twice the rate of the state as a whole.
|County||2010 Census||Estimate (as of July 2017)||Percent Change||Austin||28,417||29,786||4.8%|
|Gulf Coast Region Total||6,087,133||7,064,712||16.1%|
|Houston-The Woodlands-Sugar Land MSA||5,920,416||6,892,427||16.4%|
|City of Houston||2,099,451||2,312,717||10.2%|
Source: U.S. Census Bureau
According to a recent Census analysis, the median age for the Gulf Coast Region’s counties is on par with that of the state as a whole. While six of the region’s 13 counties have a median age significantly higher than the state’s median age of 34.2 years, the region’s most populous county (Harris, 32.9 years) is on par with the state, and Waller is one of the youngest counties in the state (28.8 years). The Houston-The Woodlands-Sugar Land MSA has a median age on par with that of the state.
Household income in Texas is more or less evenly distributed among five income levels. Of the more than 9 million households within the state of Texas, 22 percent have incomes less than $25,000 and 16 percent have incomes more than $125,000. In every region in the state, nearly 18 percent have an average household income between $50,000 and $75,000. While the Gulf Coast Region is reasonably similar to the state at lower income levels (Exhibit 2), the region has significantly more households with incomes more than $125,000 (20.3 percent) than the state, indicating potentially more household wealth than the state average.
The Gulf Coast Region’s total Hispanic population is 36.1 percent – 2.5 percentage points lower than the state’s 38.6 percent Hispanic population (Exhibit 3). The region’s black (not Hispanic) population (16.8 percent) is more than 5 percentage points higher than the state’s black (not Hispanic) population (11.6 percent) (Exhibit 3).
|Income Level||Gulf Coast Region||State Total|
|less than $25,000||19.9%||22.2%|
|$25,000 to $50,000||22.2%||23.6%|
|$50,000 to $75,000||17.1%||17.8%|
|$75,000 to $125,000||20.5%||20.2%|
|more than $125,000||20.3%||16.1%|
Source: U.S. Census Bureau
|Race and Ethnicity||Gulf Coast Region||State Total|
|Black (not Hispanic)||16.8%||11.6%|
|White (not Hispanic)||38.1%||43.4%|
Source: U.S. Census Bureau
In 2017, the Gulf Coast Region accounted for nearly 25 percent of the state’s total employment, making this region the second-largest employment base in the state. The region’s employment increased by more than 16 percent from 2007 to 2017 – on par with employment growth in the state. Employment in the Houston-The Woodlands-Sugar Land MSA also increased more than 16 percent (Exhibit 4). More than 98 percent of the region’s total jobs are in the Houston-The Woodlands-Sugar Land MSA.
|Area||Number of Jobs, 2017||Change in Jobs from 2007||Percent Change|
|Houston-The Woodlands-Sugar Land MSA||2,898,634||407,721||16.4%|
|Gulf Coast Region, Total||2,956,422||409,822||16.1%|
Note: The above figures include private and public sector employees with the exception of active duty military personnel, railroad employees, religious institution employees and the self-employed.
Sources: JobsEQ and Bureau of Labor Statistics
The average wage in the Gulf Coast Region was $64,537 in 2017. This amount is significantly higher (more than 15 percent higher) than the average wage of the state and nation. This differential holds true for the Houston-The Woodlands-Sugar Land MSA. However, from 2007 to 2017, individual wage growth in the region and the MSA was lower than the individual wage growth at the state and national levels (Exhibit 5). Adjusted for inflation, individual wages in the Gulf Coast Region increased nearly 3 percent between 2007 and 2017.
|Area||Average Wage, 2017||Change in Wages from 2007||Nominal Rate of Change, 2007 to 2017||Real Rate of Change,* 2007 to 2017|
|Houston-The Woodlands-Sugar Land MSA||$64,975||$11,453||21.4%||2.7%|
|Gulf Coast Region||$64,537||$11,489||21.7%||2.9%|
* The constant or “real” rate adjusts average wages for the effects of inflation in the value of a particular base year. According to the Bureau of Labor Statistics, prices in 2017 are 18.22 percent higher than prices in 2007.
Sources: JobsEQ and Bureau of Labor Statistics
Exhibit 6 lists the Gulf Coast industry subsectors most highly concentrated according to location quotient (LQ) — a measure of how concentrated an industry is in the region relative to the nation — and by share of total state jobs in each subsector. Industries are described according to the federal government’s North American Industry Classification System (NAICS), which is used by federal statistical agencies to classify business establishments.
The Gulf Coast Region’s most highly concentrated industries primarily concern the production of chemical and petroleum products as well as certain transportation sectors. The region’s second most highly concentrated industry subsector – pipeline transportation – is also among the region’s fastest growing. This subsector’s employment increased by more than 39 percent from 2007 to 2017.
|Industry Description (NAICS1)||Job Concentration||Job Trends||Wage Trends|
|Location Quotient2||Share of State's Jobs||Number of Jobs||Change, 2007 to 2017||Average Wage||Nominal Rate3 of Change||Real Rate3 of Change, 2007 to 2017|
|Oil and Gas Extraction (211)||12.63||49.7%||37,635||-15.0%||$218,698||22.8%||3.8%|
|Pipeline Transportation (486)||11.37||62.2%||11,851||39.1%||$186,646||30.9%||10.7%|
|Space Research and Technology (927)||8.20||99.5%||2,945||-9.9%||$127,042||20.2%||1.7%|
|Support Activities for Mining (213)||6.28||28.7%||38,354||-4.7%||$132,154||9.7%||-7.2%|
|Petroleum and Coal Products Manufacturing (324)||4.34||43.9%||10,150||-18.0%||$147,195||8.4%||-8.3%|
|Water Transportation (483)||3.05||90.3%||4,184||-1.6%||$102,166||40.5%||18.8%|
|Chemical Manufacturing (325)||2.28||48.7%||38,850||4.7%||$129,783||28.8%||8.9%|
|Heavy and Civil Engineering Construction (237)||2.16||29.3%||51,650||3.3%||$79,948||36.6%||15.5%|
|Air Transportation (481)||2.04||33.3%||20,808||-19.5%||$98,210||55.0%||31.1%|
|Support Activities for Transportation (488)||2.03||34.5%||31,944||12.9%||$63,959||27.1%||7.5%|
|Gulf Coast Region||-||24.6%||2,956,422||16.1%||$64,537||21.7%||2.9%|
Note: The figures above include private and public sector employees with the exception of active duty military personnel, railroad employees, religious institution employees and the self-employed.
Sources: JobsEQ and Bureau of Labor Statistics
A strong educational foundation is the cornerstone for growth and competitiveness in the global economy. As the Texas economy diversifies, becoming more knowledge based, a well-educated workforce offers possibilities for workplace advancement and prospects for business expansion.
In 2016, 88.5 percent of the Gulf Coast Region’s class of public high school students graduated, slightly lower than the state’s rate of 89.1 percent (Exhibit 7). The region’s high school graduation rate has increased almost 5 percent since 2010 and has regularly tracked the state’s rate.
Many high school graduates enroll in postsecondary programs, offering greater job prospects and the possibility to of earning higher wages. Residents of the Gulf Coast Region enjoy a variety of options for higher educational achievement (Exhibit 8).
Source: Texas Education Agency
Source: Texas Higher Education Coordinating Board
The Comptroller's office has analyzed data pertaining to the Gulf Coast Region, examining the region’s dynamics and competitiveness.
Receipts subject to state sales tax directly attributed to the Gulf Coast Region trended upward in the past decade (trend lines depict trends in data, either upward, downward or flat, for an extended period of time). The region had a jump immediately following the 2009 recession (Exhibit 9).
Since 2014, there has been some fluctuation in total receipts, with 2017 totals indicating the upward trend may have resumed. For 2017, receipts subject to state sales tax directly attributed to businesses in the Gulf Coast Region exceeded $109.5 billion, contributing about 22.7 percent to the state’s overall sales tax revenue collections. The Houston-The Woodlands-Sugar Land MSA directly accounted for $108.1 billion of this total.
A review of two-digit NAICS codes allows for a broad analysis of industry sectors within the region. The retail trade and the food services and accommodation sectors contribute most to taxable sales, with the two combining for more than 58 percent of the region’s state sales tax contributions. Two other industries of note are the manufacturing and mining sectors, combining for 18 percent of the region’s reported sales tax contributions.
|Year||Gulf Coast Region|
Note: Numbers shown are for reported revenue subject to sales tax and directly attributed to the region.
Source: Texas Comptroller of Public Accounts
Texas has 13 U.S. military installations within its borders. In 2017, these bases directly employed more than 224,000 and supported nearly 625,000 jobs. The U.S. military installations in Texas contributed about $62.3 billion to the state’s gross domestic product (GDP).
U.S. military installations within the Gulf Coast Region have a positive impact on the Texas economy, supporting an estimated 8,000 jobs and contributing about $717 million to the state’s GDP (Exhibit 10).
|Region||Total Jobs Supported||U.S. Military Contribution to State GDP|
|State of Texas||624,690||$62.3 billion|
|Gulf Coast Region||7,878||$717 million|
Sources: Texas Comptroller of Public Accounts, TMPC, REMI
Based on data from the World Bank and the U.S. Bureau of Economic Analysis, if Texas were a nation, it would rank as the world’s 10th largest economy in terms of GDP.
Exhibit 11 shows how the region rates with other states and the nation on a number of demographic and economic measures. The Gulf Coast Region would be the 42nd largest state in terms of land mass (square miles) and have the 14th largest population. The region would also have the 16th highest per capita income and would have the 19th highest percentage of population with bachelor’s degrees.
|Measure||Gulf Coast Region||Rank if Region
was a State
|Age 25+ with at least a High School Diploma||82.3%||50||82.4%||49||87.0%|
|Age 25+ with Bachelor's Degree or Higher||30.9%||19||28.1%||29||30.3%|
|Population Under 18 Years||26.6%||2||26.0%||2||22.6%|
|Population 65 Years and Over||10.9%||50||12.3%||48||15.7%|
|Age Dependency Ratio*||60.1%||13||62.1%||20||61.9%|
|Per Capita Income||$51,484||16||$46,204||25||$49,204|
* The age dependency ratio is the share of dependent-age persons compared to the working-age population minus the sum of those under 18 years and 65 and older divided by the population age 18 to 64. In other words, for every 100 working-age people in Texas there are about 62 dependent-age people.
Sources: U.S. Census Bureau, U.S. Bureau of Labor Statistics, U.S. Bureau of Economic Analysis
The Gulf Coast Region is a microcosm of the state with a vibrant and diverse economy. Harris County, with the city of Houston at its center, is the economic hub of the region.
As this report notes, the Gulf Coast Region and its 13 counties have many economic variables and challenges that are unique. The region contains 25 percent of the state’s population, growing 16 percent since 2010, and is the most diverse region in Texas. If this region were a state, it would be the 14th most populous (similar in size to Arizona). While the region’s median age is on par with that of the state, it has the largest percentage of households with income over $125,000. The region has many options for higher educational achievement, with 10 universities and four health science schools.
The region added more than 400,000 jobs from 2007 to 2017, and the average wage is significantly higher than the state average. The local economy is strong, with about 23 percent of the state’s overall sales tax revenue coming from the Gulf Coast Region. Industry concentration in the region primarily revolves around the production of chemical and petroleum products, as well as certain transportation sectors, all contributing positively to this unique local economy.
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