Texas has been known as a business-friendly state for decades, and many entrepreneurs from Silicon Valley are now choosing to move their startups south to the Lone Star State. With wide open spaces and an absence of personal income and corporate income taxes, Texas has become the latest hot spot for tech companies looking to relocate their operations. Texas Representative Roger Williams told FOX Business, “We’re seeing a lot of job growth and a lot of startup companies and it’s being fueled in many cases by energy but also by the opportunity of no personal income tax. [It’s] a very business friendly state and it wants businesses to come and start up.”
Another factor encouraging tech companies to move to Texas is the low cost of living when compared to larger cities like New York, San Francisco, and Chicago. Austin in particular has seen a significant increase in tech companies moving to the city, as it has a cost of living about 4 percent below the national average. Austin also has a reputation of attracting motivated students to local colleges like the University of Texas at Austin that can then apply to entry level tech jobs being created by the technology industry influx. “Home to 5,500 startups and tech companies, Austin has become a favorable alternative to the Bay Area and New York City for companies of all sizes that are looking to grow,” CompTIA says in its Tech Town Index report, released November 10, 2020.
Based on approximately a year of data from job-posting sites from 2019 to 2020, the CompTIA trade group, a nonprofit global technology industry association, analyzed 20 large metro areas with populations over 250,000 and where demand for tech employees is greatest. The 2020 Tech Town Index report is the third such report released by CompTIA. Each Tech Town Index ranks selected metro areas based on cost of living and how many IT jobs were posted. It then uses that data to project IT job growth over the next one to five years. That analysis put Austin in first place this year.
CompTIA reported more than 100 tech companies have moved to the Austin area in the past two years, adding over 4,600 jobs to the area. Tech job postings continue to grow in the region, with an increase of 19,000 posted jobs over the past year alone. CompTIA predicts that over the next five years IT job growth will increase by 16 percent in the Austin area. The area’s median salary for tech professionals is approximately $88,000.
The following companies were identified as aggressively hiring IT professionals in Austin:
- The Home Depot
- Charles Schwab
Coming in a close second to Austin was the Dallas-Fort Worth (DFW) area, which jumped from seventh place last year to second this year – the biggest leap of any city on the report. DFW’s jump towards the top of the list can be attributed to the sheer number of jobs available compared to last year’s postings. DFW also has significant projected growth of an estimated 3 percent in available tech jobs from 2020 to 2021 and an eleven percent growth over the next five years. The area’s median salary for tech professionals is approximately $94,000 while the cost of living sits below the national average by 2 percent. North Texas had nearly 180,000 information technology jobs in 2020, with growth focused on web, mobile application, and software development. “The conventional technology enterprises have set the tone for the Dallas tech scene while emerging technology companies are taking it to the next level,” CompTIA notes in the report.
The following companies were identified as some of the largest IT job creators in Dallas Fort Worth:
- Lockheed Martin
- JPMorgan Chase
- Wells Fargo
- NTT Data
The COVID-19 pandemic, which has affected all industries over the past year in unprecedented ways, played a big role in the IT industry’s job growth this year. The IT industry adapts to remote work well and “[d]uring COVID-19, the demand for remote IT workers has increased with the number of job postings nearly doubling,” the CompTIA report said. Between August 2018 and July 2019, about 10 percent of IT positions were labeled as remote or work from home. That number changed significantly as the number of remote or work from home jobs jumped to 21 percent, or almost 800,000 IT jobs nationwide.
“Ultimately, it’s difficult to predict how the circumstances of 2020 will affect the technology industry in the years ahead,” the CompTIA report stated. “However, … IT pros are in demand and have more options than ever before when choosing where to live and work.”
Whether it’s the lower cost of living or the lack of personal and corporate income taxes, more people are moving to Texas and more Texans are being given greater opportunities as tech companies relocate to Texas and create more jobs. As companies move into our home state, they will have business transaction needs, as well as commercial litigation, real estate, and employment issues arise. Our experienced trial lawyers stand ready to assist our new business neighbors in acclimating to live in Texas successfully and profitably.