Writer: Andrea Teran
3 min read January 2024 —The healthcare sector has emerged as a vital pillar of Houston’s economy. The Greater Houston Partnership’s (GHP) Employment Forecast highlights the sector as a crucial economic engine, projecting the creation of 10,000 jobs or more in 2024. As of September 2023, the sector employs 381,000 individuals, making up 11.3% of the region’s total employment, signifying its role in driving the local economy.
“Healthcare has been a key driver of Houston’s economy for several decades. The sector has consistently expanded, except for a slight dip in 2020,” Patrick Jankowski, senior vice president and chief economist at the Greater Houston Partnership, told Invest:.
“Several factors will drive health care in Houston over the next few years—population growth, job growth, an aging population, and investments at the Texas Medical Center. The most notable project underway is TMC3/Helix Park, a world-class life-science and medicine campus, attracting doctors, patients and researchers from around the world,” he added.
Additional data from the U.S. Bureau of Labor Statistics reports that healthcare and social assistance sectors added 23,300 jobs over 2023 in the region, accounting for 95% of the total job gains in the education and health services supersector. That is a significant growth of 5.6% for Greater Houston, while also surpassing the national rate of 4.2%.
The GHP Forecast attributes this growth to several factors, including population increase and job growth in sectors offering health benefits, where Houston has added 527,000 jobs over the past decade. Rising household incomes also play a role, with over one million households reporting annual incomes over $100,000 in 2022, a considerable increase from 550,000 a decade ago. The aging population, with those over 65 years old increasing from 570,000 in 2012 to 900,000 in 2023, as well as high birth rates, highlight the growing demand for healthcare services. Additionally, the Affordable Care Act has increased the insured rate in Houston to 82% from 76.6% in 2012.
Houston’s healthcare sector has also achieved national recognition, with Houston Methodist Hospital landing on the America’s Best Hospitals Honor Roll by U.S. News & World Report, and sharing the top spot with Dallas’ UT Southwestern Medical Center in their Best Hospitals in Texas rankings. Greater Houston claimed the majority of the top 10 spots in the state rankings, with Baylor St. Luke’s Medical Center at No. 3, Memorial Hermann Hospital-Texas Medical Center at No. 4, Memorial Hermann Greater Heights Hospital at No. 6, Houston Methodist Sugar Land Hospital at No. 9, and Memorial Hermann Memorial Medical Center at No. 10. Additionally, Texas Children’s Hospital was the top-ranked children’s hospital in the state, while TIRR Memorial Hermann was acclaimed as the best rehabilitation hospital in Texas.
In 2023, Houston’s medical office space sector also made a significant impact, with the city boasting five of the nation’s 20 largest medical office developments, as evidenced by 42Floors rankings. Projects include the $1.3 billion O’Quinn Medical Tower on the McNair Campus, featuring a comprehensive ambulatory surgery center; Houston Methodist Sugar Land Medical Office Building 4, which will house departments including neurology, cardiovascular, and family medicine; the expansion of Kelsey-Seybold Clinic’s Springwoods Village campus; the expansion of the Kelsey-Seybold Clear Lake Clinic; and the 1715 Project by Tannos Development Group, a multi-tenant Class A medical office development.
While Houston’s healthcare sector has achieved significant growth and recognition, it’s crucial to address the broader challenges facing Texas in healthcare. A study by WalletHub ranked Texas as the seventh-worst state in America for healthcare, placing it 45th overall. (Ranking includes the District of Columbia.) The evaluation was based on factors like healthcare cost, accessibility, and outcome. Texas notably had the lowest percentage of insured children and adults in the nation, highlighting critical issues to address in insurance coverage and accessibility.
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