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Why Austin, Texas, is the New Tech Hub

While many might have stereotypes of Texas as being all about barbeque, southern hospitality, country music, and an epicenter for oil production, the Lone Star State is an innovative center for all things tech. In recent decades, cities such as Houston, Dallas, and San Antonio are making new headways for tech to explode and become more and more relevant and inventive as the times change. But Austin is one specific city that’s been making extreme progress in the tech industry that keeps growing at unprecedented rates. 

After experiencing the internet boom in the 1990s, Austin proliferated with telecommunication firms and information technology. The city is pushing the tech industry forward with groups like Capital Factory, Opportunity Austin, and more. But what are the reasons for these changes in Austin, and why is tech booming in the flourishing city? Here’s what we’ve found: 

Immense Population Growth 

Between 2010 and 2020, Austin, Texas, experienced a growth rate that’s more than five times the United States population growth, which amounted to 33.7%. To put this into perspective, the growth rate in Austin alone is more than double the population increase of Texas itself, which saw a 16.8% growth rate in 10 years. According to the United States Census, Austin had a population of 1.24 million in 2000 to 2.29 million in 2020. As of 2023, Austin has experienced a population growth of 2.39% in just one year. With more and more people moving to this flourishing city, tech companies have abundant choices for talent to hire and collaborate with to make their business goals a reality in the major Texas city. 

Great Business Resources

Tech companies in Texas have business resources and perks that aren’t in other locations. For example, the Lone Star State offers massive amounts of purchasing power and decreased costs for operations. The result of these working conditions: higher profits! Especially for tech companies who have high-priced infrastructure, these benefits are too good to pass up. 

In addition, Texas also offers corporate-friendly tax incentives, which permit small to midsize enterprises to be inventive and catch up with tech giants that already established their work in the area. With this direct support to small businesses and startups, the network needed for immediate tech support isn’t hard to find. 

Texas offers specific benefits for businesses in the tech industry. By offering tax breaks and incentives, the area is the perfect place for tech enthusiasts to begin dreaming big and establishing their tech companies with innovation. For example, Texas offers a 100% exemption of sales tax for essentials for data centers like media equipment, power infrastructure, electricity, and power infrastructure. To receive these benefits in Texas, the data centers must meet specific guidelines such as making $200 million in capital investment, 20 new jobs, and an average salary that’s 120% of the U.S. average salary. 

Employees can also experience some benefits. If an individual works in Austin, there will be no corporate income tax due to the low state taxes and amenities. There is also capital funding available for individuals, not just businesses. With this considered, anyone can expand their business in Austin, Texas. 

Many Education Opportunities 

For any location to become the new tech hub, it’s essential for there to be education opportunities, and Austin has them. The strong push for education is most evident when exploring the plethora of world-class universities in the city, such as Southwestern University and Texas State University

The University of Texas at Austin is a star staple for tech education in the city since it has esteemed computer science programs. Students at this university research tech in real time, intern at top companies, network with recruiters, and go to industry conferences that help them get their foot in the door before even receiving a diploma. 

Big Tech Dominates

When exploring what ignited Austin’s tech boom, it’s paramount to consider Dell Technologies. After being founded by Michael Dell, a University of Texas in Austin student, in 1984, Dell swiftly grew globally. With its quick success, Dell was the magnet that pulled in other tech companies, suppliers, and vendors to Austin. Soon enough, entrepreneurship became a norm in Austin, and creativity seemed to come second nature for eager innovators who moved to the area.  

In addition to the influence of Dell Technologies, IBM, Tivoli, Texas Instruments, and others have also left their mark on the city and have inspired other tech enthusiasts to plant their feet in the city. 

The inspiration is still multiplying with tech giants such as Google and Apple in the city, making it the perfect spot to nail a dream job and learn from some of the most prominent tech developers in the world. 

Elevated Living Standards

The elevated living standards in Austin attract talented tech enthusiasts and companies alike. While pricing has increased in the past decade, it’s still more affordable than locations like Boston, New York, and Los Angeles. In addition to the financial aspects, Austin is the home of a diverse population that offers a wide selection of cultures that come together and create a dedicated community that puts in the effort to make the city thrive. 

The health and fitness community is one of the most prominent in Austin, with activities such as biking, kayaking, swimming, running, and hiking being normal activities during local’s free time. The live music scene attracts newcomers with many options in the Moody Theater, The Saxon Pub, the Paramount Theater, and the Empire Control Room. Plus, Austin is known for its low crime rate. With Austin having rates lower than the national average for crime, areas such as Hyde Park, Old Enfield, and RollingWood are top options in the city to move to. 

Employment Opportunites

When combining the great business resources and the tech culture, it’s only right to assume the employment opportunities are great in Austin. According to the Texas Workforce Commission, Austin’s employment growth has remained above the U.S. and Texas as a whole between 2010 and 2020. 

Austin had a total of 9,800 employers that were affiliated with the tech industry as of 2022, which amounts to 195,879 jobs created. When put into percentages, Austin’s tech employment equals 16.3% of the entire population! 

The Future of Austin

Austin is a key trailblazer for other U.S. cities wanting to embrace the rise of tech. But what else will Austin do besides inspire in the future years? For one, Austin will continue to see companies and tech startups planting their roots in the city and providing more job opportunities. 

Additionally, Austin is predicted to attract the younger generations in upcoming years, which will meet these job position demands tenfold. Big tech companies in Austin, such as Indeed, Dell, and SolarWinds, will continue to thrive in upcoming years. 

The future of Austin will also be a monumental location for the development and research of rising tech, such as robots, artificial intelligence, biotechnology, self-driving cars, and machine learning. So, let’s sit back and continue to see how Austin redefines the tech industry!

Picture of By Lindsey Feth

By Lindsey Feth

Managing Editor, Innovation & Tech Today

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