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Office vacancy doesn’t surprise me. I think as younger people become a larger % of the workforce, the idea of coming into an office with a briefcase that holds the Johnson file is becoming an obsolete notion.
The office vacancy issue is driven almost completely by the fact that the oil companies and their service providers are by far the main drivers of large-scale office occupancy in Houston. Due to economic conditions and increased labor efficiencies gained since the oil price crash, these firms don’t see the need to hire more white collar workers, therefore, no need to expand their office occupancy footprint.
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Also, sublease space converts to direct vacancy as time goes on, which also impacts vacancy statistics.
I work for an engineering company that services the oil sector. During every crash we send a larger percentage of our work to India. We’re getting close to 100% of project work moving over there. The only thing that can stop it is government intervention. Corporations do not and cannot care about their workers as long as there is no rule against sending work on American projects overseas. Houston is giving away an entire industry with 10s of thousands of high paying jobs. It’s no wonder our office vacancy is so bad even though oil prices are up.
@Jgriff – sshhh, it’s not offshoring, it’s just increasing utilization rates of “high value engineering centers”
@Jgriff and I imagine any work not offshored is given to H1Bs here – or even split among global teams. College Station is highly complicit in all of this: http://www.pewresearch.org/fact-tank/2018/03/29/h-1b-visa-approvals-by-us-metro-area/
The execs at O&G energy & other companies do NOT care about the minions. Only their stock options.Hence offshoring/outsourcing workers overseas. And the Federal government has perpetuated policies that encourage the mass outflow of jobs. And many of those policies were legislated by REPUBLICANS ,at the behest of the REPUBLICAN led business interests!! Of course Texas A&M is complicit in this whole sordid mess. It’s republithugs who outsource their HYPOCRISY and then turn around & say they’re pro-American.
Why should a US business, be compelled by the government via threat of force, to not have work done by someone outside of the US? Where in the constitution is our government given that power? and why are people so quick to give our government even more power over our lives?
HappyGoLucky: “The execs at O&G energy & other companies do NOT care about the minions. Only their stock options.”
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Absolutely correct. The people who run a public company are legally obligated to run the company in such a way to be profitable to the owners (share holders). To not do so would violate their fiduciary duties.
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It’s your responsibility, as someone that’s trying to sell labor, to prove your worth to be able to be competitive in a global environment. The US doesn’t exist in a bubble. This isn’t a new concept. You can’t expect the government to protect you by sheltering you from outside economic pressures.
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hell, you should LOVE Trump. He has a lot of the protectionist mindset that you have.
@all. Please consider the 3 layers of O&G: up-, mid-, and down- stream. Simply put, ya’ can’t drill the oil/gas that’s nearby to us… overseas (no-duh, but I feel I need to remind @all of that)– you cannot effectively outsource that. You need LOTS of local resources in the fields (in nearby plays). Those resources report into offices-not-in-Houston-but-ultimately-up-to-offices-in-Houston. What’s been changing is that a lot of supportive (mid-stream) *informational services* (stress on that) can be accomplished overseas and from remote. Believe it or not, but the big-operators have been perfecting this for a while. By running information-work operations overseas. These resources and management/structure/etc thereof, really high power ones, are moving out. Pity.
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Since I brought it up: ya’ can’t outsource the sale of gasoline, to local consumers (down-stream), because employee/support/management still needs local presence (I’m simply not driving to India any time soon to fill’er up). I know that a lot of exploration companies are foreign (up-stream), but how that operates is even more strategically regulated than Facebook. You have to understand that in order to make a gallon of gas, there’s so, so, so, so, so much more local touch that’s needed to do that, and so, so, so, so much more that’s produced as by-products pegged to price– goofy shit from weird valves replace daily to life/death oxygen used in hospitals to the-smell-that’s-collectively-known-as-Pasadena :) What it takes getting these products into your local car/elsewhere (down-stream) also requires so, so, so, so much local presence, as well transacting those products outwards.
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Finally, please consider that Houston, along with the major operator here, transact worldwide. Shifts in global theatres (in all 3 layers) have tremendous effects. What a LOT of people do not understand is that HOUSTON is sort’a THE global outsource mecca for O&G companies. Our barometer represents… it IS the goings-on in the industry world wide.
I’ll agree with Cody’s larger point that economics and capital flows don’t care about national boundaries. The free market is a juggernaut that will simply overwhelm government protectionist policies. It can find the fastest and easiest way around any law six ways to Sunday.
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So, protectionist talk is simply that: talk. As a realistic notion, one competes everyday against your neighbor, your office-mate, your fellow American, and even the worker across the globe. Chris does have a valid point that physical located items (such as the gasoline station or refinery) cannot be off-shored.
Working for a large multinational O&G, the offshoring to achieve “value” is comical at times. Last week had a mulit-day email chain going because someone initiated a ticket for a data server stateside but the support is in India(was moved during the downturn). Nobody was on the same time schedule so of course it took way longer than it used too. Another example is we are working on a project with a vendor and higher ups wanted it to deliver at price point that was unrealistic. Vendor offers to build overseas and ship to site instead of building stateside and testing at their facility. Even though this vendor is known for overseas work being deficient and needing several revisions. Higher ups pat themselves on back because they got the price point they wanted and that’s all that matters. All those STEM jobs O&G like to tout were gutted during the downturn and sent overseas or filled by H1Bs over senior employees. I’m not personally less worried because like Chris M(2) stated there are multiple layers and the closer you’re to wellhead or refinery those jobs can’t be off-shored.