Texas Today: Strong Business Environment and Innovation Spurs Job Creation
What recession? Texas can boast cheerful headlines and the creation of thousands of new jobs.
Steve Stackhouse-Kaelble (April 2012)
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Positive news headlines have been in rather short supply in many U.S. places, but not so in Texas. Recently, Apple Inc., Boeing, GE Transportation and Continental Automotive Systems have all announced major job-creating projects within the State.
Many a state would be green with envy at the diversity of businesses that share hopeful futures in Texas. So what makes the outlook so positive? It certainly helps having massive volumes of energy beneath the soil and in the air, waiting to be tapped. And while the presence of such resources could be seen largely as a matter of divine intervention or good fortune that has little to do with human efforts, the truth is that shale gas in Texas and elsewhere might still be seen as untouchable if not for the innovations of George P. Mitchell - a Texan.
Beyond the state's penchant for innovation, Brandon cites an environment that welcomes business activity with open arms. "Texas has an independent and conservative business tradition, and is committed to promoting business opportunities," he says. That's not a political statement, either, as pro-business attitudes can be found on both sides of the aisle in Texas.
Among the welcoming attributes, the state has been working on its legal system in an effort to ensure it's fair to all, including businesses. For example, 2011 reforms include several geared toward discouraging frivolous lawsuits.
Then there's the fact that things in Texas tend to be Texas-sized - "the sheer number and wealth of options are extremely appealing," Brandon says. "There's a broad variety of work force choices, from unskilled hourly labor to extremely skilled technology and corporate professionals," he explains.
Gigerich rattles off a similar list of positive attributes that help drive Texas growth: "great tax structure; bilingual work force; large population; different markets that can offer different types of settings for companies (urban, suburban, and rural); affordable labor costs; outstanding road, air, and rail infrastructure; and good quality of life."
Just to expand a bit on one of these key points - there's no corporate income tax in Texas, and no individual income tax, either. At the state level, there's no property tax. If you're thinking the sales tax must therefore be through the roof, think again. Some states have lower sales tax rates than Texas, but the rate is a fair amount more in other states.
As for the work force, it's about 12 million strong, marked by a variety of industry-specific concentrations in different regions. That makes it easier to find the right workers. And, as anyone in human resources knows, finding properly skilled labor is not always easy, even with the higher unemployment rates that the recent recession brought.
Texas is a prime address for conducting international business, with exports that continue to grow explosively. Consider that they were $163 billion in 2009, $207 billion in 2010, and $250 billion in 2011. Exports grew by 20.7 percent last year, and the state's share of America's export picture hit 16.9 percent, up two whole percentage points since 2008. For the 10th consecutive year, Texas has been the nation's top exporting state, according to the U.S. Department of Commerce. The top export industries last year were petroleum and coal products, chemicals, computer and electronic products, non-electrical machinery, and transportation equipment.
What makes it a great place for connecting globally? For one thing, its dozen deepwater ports include the port of Houston, second-busiest in the country and 13th-busiest in the world. More evidence of global-business friendliness includes the recent ranking of the Alliance Foreign-Trade Zone as the nation's top general-purpose foreign-trade zone. The most recent figures available cover fiscal 2010, when the FTZ admitted more than $4 billion in foreign products, more than any other general-purpose FTZ (it's the fourth time in the past five years that Alliance has grabbed that ranking).
One more thing worth mentioning: Though the state is marked by an independent streak that strives to keep government out of the way of business success, the public sector remains there to help when needed. The list of incentive programs and financial assistance for expanding businesses is long and generous.
For example, there's the Texas Enterprise Fund, a "deal closing" fund that is the largest of its kind in America. For projects that promise significant job creation and capital investment, the fund is able to step in and sweeten the pot to ensure that Texas is super-competitive with other jurisdictions.
Then there's the Texas Emerging Technology Fund, which helps those doing business in Texas to recruit top research talent, then migrate innovative ideas from the lab into the marketplace. Add in generous financing options, valuable grants, and attractive incentives and you'll see why a lot of organizations are ranking Texas among the nation's best places to do business.