The stars at night aren’t the only big and bright things on the Texan horizon. As Silicon Valley loses its luster, Texas is steadily becoming one of the most appealing destinations for tech companies looking for a change of scenery. Texas is pitching a compelling vision to attract new companies to the state. The invitation is extended with their famous Southern hospitality, but Texans mean business. Companies are sitting up and taking notice.
For tech companies, California has three big strikes against it: high taxes, high cost of living, and strict business regulations. These factors are difficult for a CEO to overlook. When the average commuter weighs in on quality of living issues such as astronomical home prices, traffic congestion, pollution, and wildfires, it gets easier to trade their In-N-Out Burger for Tex-Mex.
Texas is ready to host an influx of new companies. In 2023, Texas ranks as the best business climate for companies looking to relocate or expand. In fact, Texas is the source of more corporate relocations than any other state. Oracle, Apple, Tesla, Hewlett Packard Enterprise, Amazon, and many others have already made the move. Many more are on their way because Texas offers a strategic package that’s hard to refuse.
1. Healthy economy.
The Texas economy is strong, and it’s growing. Texas had the fastest GDP growth in the U.S. for the first quarter of 2023 with a 3% growth rate. It grew faster than the U.S. as a whole, for the fourth quarter in a row. At $2.1 trillion, Texas also has the second-highest GDP (behind California.) Its economy is the 9th largest in the world. (That puts Texas ahead of Canada, South Korea, Russia, and Australia.)
2. Reasonable cost of doing business.
Texas doesn’t have state income tax. (Not to rub it in, but California residents pay up to 13.3% in state income tax.) Processes, such as land acquisition and building permits, are deliberately efficient.
Texas is in the center of the country. This is going to save time and money when relocating employees. All major domestic and international markets are accessible from Texas by land, sea, and air. Its investment in infrastructure, such as ports, roads, rail, and air networks, enabled Texas to be the nation’s top exporter for 21 consecutive years ($35.6B).
3. Available workforce.
Texas has over 15 million workers. Texas added more jobs (534,600) than any other state over the last 12 months, and grew at an annual rate of 4.0%, faster than the 2.6% rate for the U.S.
Texas also prioritizes its education institutions, such as technical training and its universities. In 2022, US News & World Report ranked six universities in Texas in their top 100 schools. Skilled workers will stay in the pipeline.
4. Affordable standard of living/quality of life.
When remote work became more common during the pandemic, many people relocated away from the places with higher costs of living. As companies consider work-from-home and hybrid options, they’re exploring locations that offer a better quality of life for their employees.
In Texas, the average cost of living is 8% lower than the national average. This includes housing, rent, gas, taxes, utilities, and transportation. And as the second most diverse state in the United States, Texas has much to offer regarding quality of life- culture, history, music, and food.
According to Texans, everything is bigger in Texas. When it comes to their state’s business incentives, they’re not exaggerating. Texas is perfectly poised to give Silicon Valley a run for its money. If you’re the leader of a tech company, it’s an ideal time to consider a transition to the Lone Star State.
Y’all are welcome to come.
