Market Update: We break down the business implications, market impact, and expert insights related to Market Update: GHP: Regional economy growing faster than peer metros | Business – Full Analysis.
Editor’s note: In its “Economy at a Glance” report for March, the Greater Houston Partnership – the regional chamber of commerce – takes an in-depth look at Houston’s Gross Domestic Product – its broadest measure of economic output. Using newly released data from the U.S. Bureau of Economic Analysis, the Partnership examines the forces that have made Houston one of the fastest-growing economies in the nation. This issue also highlights the growing number of business announcements in 2025, as companies invest and expand across the region. This article first appeared in The Leader’s sister paper, the Fort Bend Star.
The U.S. Bureau of Economic Analysis (BEA) typically releases Gross Domestic Product (GDP) estimates each December detailing the total dollar value of goods and services produced by U.S. metro areas in the prior year. While BEA discontinued its metro-level estimates in 2025, it continues to publish county-level data. Using those county figures, the Partnership has produced GDP estimates for the broader Houston metro area in 2024. Although calculation methods have changed, analysis should not be materially affected.
Metro Houston’s GDP reached $758.3 billion in 2024, surpassing three-quarters of a trillion dollars in real (inflation-adjusted) terms for the first time on record. That milestone caps off several years of exceptional growth, especially following the COVID-19 pandemic.
Expansion was modest coming out of the fracking bust a decade ago, with real GDP averaging a 1.5 percent annual growth rate in the back half of the 2010s. Growth accelerated sharply after the pandemic, averaging 5.1 percent annually during the past four years. While expansion has cooled a bit, GDP still rose 4.1 percent in 2024, well above the national rate of 2.8 percent.
Houston’s economy is not just growing faster than the nation on average; it is also growing faster than nearly all its peer metros. Over the previous two years of available data, Houston’s real GDP grew by 10.6 percent from a baseline of $685.6 billion in 2022. That ranks second among the top 20 largest metro economies, just behind Seattle’s 10.7 percent gain. In absolute terms, Houston added $72.6 billion in output during that time, also second, trailing only New York’s $77.7 billion increase.
The greater Houston economy’s GDP ranked second among the nation’s 20 largest metropolitan regions from 2022-24, according to a Greater Houston Partnership analysis of U.S. Bureau of Economic Analysis. (Source: Greater Houston Partnership)
That rapid pace of growth has lifted Houston to become the sixth-largest metro economy in the nation. Houston moved ahead of Washington, D.C. in 2024, producing $9.1 billion more in economic output than the nation’s capital. Houston is now one of only six U.S. metros with annual output exceeding three-quarters of a trillion dollars. Of the five ranked higher, four (New York, Los Angeles, Chicago, and Dallas) benefit from larger populations, while one (San Francisco) is boosted by the nation’s largest concentration of tech firms.
GDP by industry
Five sectors – manufacturing, professional services, real estate, government, and health care/education – were leading economic engines. Together, they generated over half of the region’s economic output in 2024. The BEA withheld regional wholesale trade data for the year, but past trends indicate it was also likely a major contributor.
Manufacturing and professional services are clear areas of competitive strength. Each generated more than $100 billion in output in 2024, making them Houston’s two largest sectors. Both command a larger share of the local economy than they do nationally. Manufacturing stands out in particular, representing 16.7 percent of Houston’s total output compared to 9.8 percent for the nation. Real estate, government, and health care/education remain essential pillars of the regional economy, but they comprise smaller shares of output relative to the national averages.
While Houston remains the energy capital of the world, its economy has greatly diversified since the Fracking Bust of 2014. But measuring that shift is difficult since industry categories used by BEA don’t neatly align with the broad “energy” sector. Energy activity is spread across many industries, including manufacturing (e.g., petroleum refining), transportation/warehousing (e.g., pipelines), and professional services (e.g., engineering services).
The closest proxy available is oil and gas extraction (also called “mining” in the BEA data), which reflects only the narrow slice of firms directly involved in pulling resources from the ground. That narrow sector’s share of GDP has fallen by more than half, from 7.7 percent in ’2014 to 3.8 percent in 2024, even while its output has grown, underscoring Houston’s diversification and the faster pace of growth in non-energy sectors.
Find the full “Economy at a Glance” report at houston.org/houston-data/economy-at-a-glance-march-2026.