Tuesday, April 02 2019
In 2018, Texas continued to demonstrate the results of an ideal climate for economic success. Announcements from businesses choosing the Lone Star State were regularly in the news—with a $1 billion investment from Apple along with new commitments from Cheniere, Cognizant, JSW Steel and McKesson, to name a few. The state also experienced noteworthy success when compared to the rest of the country. For example, as of December 2018, the Lone Star State added 391,800 jobs over the year—the most of any state—as total nonfarm employment reached a new high of 12.74 million, marking 104 consecutive months of annual growth.
As further testament to its prosperity, Texas was named America’s No. 1 Growth State for the third year in a row, according to U-Haul. Data from the moving equipment and storage rental company indicates that arrivals of one-way trucks were up five percent from the previous year. Additional data from the U.S. Census Bureau shows Texas gained a total of 379,128 new residents from July 1, 2017 to July 1, 2018—the largest numeric gain in the nation—indicating people are flocking to the state to take advantage of impressive job opportunities and a high quality of life.
Among Texas’ thriving industries, four emerged from the rest as particularly significant to the Lone Star State’s economy. These industries, highlighted below, are influential in demonstrating that Texas is a global powerhouse, which is only getting stronger.
This sizeable investment, coupled with more than 17,600 pre-existing technology companies in the state, has allowed for a flourishing high-tech ecosystem. Between 2010 and 2017, employment in the IT and telecom cluster grew about 20 percent and now represents five percent of the state’s entire workforce. As the birthplace of technology breakthroughs, including the semiconductor, and home to Texas Instruments and Dell Computers, Texas actively welcomes industry innovators and continues to make a name for itself against established competitors. As evidence, Texas is the No. 1 high-tech exporting state, beating out No. 2 California.
In addition to its strong roster of multinational companies, Texas’ high-tech ecosystem has proven attractive for an increasing number of small businesses, startups and entrepreneurs. The large influx of innovators and entrepreneurs to the Lone Star State warranted four Texas cities to rank as “Best Places in America for Starting a Business” in 2018. According to the ranking published by Inc., Austin is the No. 1 city in the nation to start a business, while Dallas (No. 17), San Antonio (No. 30), and Houston (No. 32) also made the list. Another testament to the state’s growing focus on innovation is the recent announcement by FitSmallBusiness.com naming Texas as the “Best State for Female Entrepreneurs” in 2019, based on its strong business climate, career opportunity and economic and financial health.
Energy companies continue to select Texas for their business expansions, thanks to the state’s established expertise in this industry and the expanding energy sector, beyond oil and gas. In fact, the state is No. 1 in total energy production and biodiesel production capacity and is No. 6 in solar energy production. Texas also has the critical infrastructure in place that is necessary to support the energy sector. It should come as no surprise that Texas is the only mainland U.S. state with its own power grid and produces more electricity than any other state. Renewable energy is also on the rise in Texas, with two of the western hemisphere’s largest wind farms operating within the state.
One of Texas’ most recent and notable investments came from Cheniere Energy Inc., with the official opening of its $15 billion liquefaction facility in Corpus Christi, Texas, in November 2018. The new facility sits on more than 1,000 acres of land and has increased the company's annual capacity of liquefied natural gas (LNG) from 13.5 million tons to 22.5 million tons. Cheniere concluded its opening ceremony with the first shipment of LNG leaving the plant, marking a major milestone for Texas’ entry into the global LNG market.
Cheniere is not the only energy company that decided to “Go Big in Texas” last year. ExxonMobil and SABIC announced a new joint venture in May 2018 to advance the development of the Gulf Coast Growth Ventures project, a 1.8 million-metric-ton ethane cracker planned for construction in San Patricio County, Texas. The project is expected to create 600 new, permanent jobs, about 3,500 indirect and induced jobs during operations, and 6,000 construction jobs during the peak of construction.
Dynamic Defense and Security
In July 2018, the U.S. Army announced the new Futures Command headquarters would locate in Austin, indicating the Texas capital’s triumph over four other leading U.S. locations. The new Futures Command headquarters will focus on developing state-of-the-art military technologies and innovations. By locating in Central Texas, the center will enable the Army to better partner with academia, industry and innovators in the private sector.
Companies specializing in aerospace, defense and security take advantage of the state’s major airports, thanks in part to Southwest Airlines Co. and American Airlines, which have established headquarters in the state. Additionally, two of the 15 busiest airports in the U.S. are located in Texas: Dallas-Fort Worth (DFW) International and George Bush Intercontinental Airport (IAH) in Houston.
An Automotive Industry on the Move
At the pinnacle of Texas’ burgeoning automotive industry is Toyota USA. The automotive giant officially relocated its North American headquarters from Torrance, California to Plano, Texas in 2017. Toyota decided to establish its headquarters in Texas for the central location and access to major airports. Texas also serves as a primary link between Mexico’s auto plants and the rest of the U.S. auto industry and is home to major operations of General Motors, Peterbilt Motors, Toshiba International Corporation and Caterpillar.
A Leading Location for Logistical Success
If Texas were a country, it would be considered the 10th largest economy in the world. Based on the numbers, there is little room to wonder why Texas’ infrastructure and logistics network are world-class. Texas’ robust infrastructure includes 382 airports, 10,539 miles of freight rail, 16 seaports, 32 Foreign Trade Zones (FTZs) and more than 313,220 miles of public roads.
Another crucial element to Texas’ robust logistics network is the Dallas-Fort Worth (DFW) International airport, which was recently ranked the '2019 Global Airport of the Year' by Air Transport World for its innovation and operational excellence. This Texas airport generates a regional economic impact estimated at $37 billion annually and is the fourth largest airport in America. DFW has more domestic destinations than any other U.S. airport, is North America's largest carbon-neutral airport and added 28 new destinations to its roster in 2018.