Texas has become the tech industry's budget-friendly alternative to California

[Skye Jacobs]

In a nutshell: Texas is solidifying its position as a major tech hub, with Apple's recent announcement of a new 250,000-square-foot AI server production facility in Houston serving as the latest testament to the state's growing tech industry. This development is part of a broader trend of technology investments reshaping the Lone Star State's economy, often fueled by California-based companies seeking lower taxes and a more business-friendly regulatory environment.

The influx of tech giants into Texas is reshaping the state's economic landscape. Apple already maintains its second-largest employee base outside Cupertino in Austin, while Samsung continues expanding its semiconductor operations in the state. Meta has relocated its trust and safety teams to Texas and other US locations, and companies like Realtor.com, Tesla, and Hewlett Packard have moved their headquarters there.

John Diamond, an economist at Rice University in Houston, explains the appeal: "In the end, it's all about the cost of doing business, and the cost of doing business is just lower in Texas," he told the Wall Street Journal.

The tech sector's growth in Texas has been remarkable. In the decade leading up to early 2024, high-tech jobs in the state grew at an average annual rate of 4.7 percent, outpacing overall job growth of 2.1 percent, according to the Federal Reserve Bank of Dallas. This influx of tech talent is transforming urban centers like Austin.

Joseph Brusuelas, chief economist at consulting firm RSM, notes that dining in downtown Austin "is like being in Silicon Valley circa 2005" due to the concentration of young, educated tech workers.

The tech boom isn't limited to large corporations. Startups like Graze Robotics are also finding Texas an attractive destination.

Graze CEO Logan Fahey Franz cites several incentives for moving to Plano, including relocation support, tax rebates, and the city's openness to product testing in public spaces.

"Compared with California tech hot spots, 'it's gotten to the point where you can recruit, retain, and your cost is, I think we like to say, about 30 percent cheaper,' because of lower costs for labor and regulations," Franz said.

The state is also introducing new tools and services to attract businesses, including a specialized business court for complex commercial litigation – directly challenging Delaware's long-standing dominance in this area.

Despite the overall positive trend, Texas faces some challenges. While tech job growth remains above the national average, its pace has recently slowed. Additionally, manufacturing activity declined in February, with some computer and electronics manufacturers expressing concerns about potential tariffs affecting customer demand.

The state's restrictive abortion laws have also raised concerns among some companies considering relocation. However, David Yim, chief investment officer at USAA in San Antonio, suggests that business pragmatism often outweighs political considerations. "Politics certainly matters, and policy certainly matters. Pragmatism really for business and public companies is probably a bigger factor."

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Texas has become the tech industry's budget-friendly alternative to California

 

[passwordistaco]

The cost of doing business will be lower until the California transplants vote to turn Texas into California.

 

[opckieran]

This isn't news. Texas has been an attractive proposition for just about anyone fleeing the Leftist "paradise" known as California for nearly the last 15 years, from single people all the way to the largest corporations. I wonder why?

 

[Kirby1]

This is by design. California has a ton of start up businesses. They like to make it easy for small businesses to start but hard for big businesses to stay. Mature businesses are basically intangible goods that California exports.

 

[The Talking Tech]

Correction, Texas is the place big corporations choose to move their headquarters the moment other states try to regulate them...ask Elon Musk, he knows everything about that.

Texas just have become a Safe heaven for rich corporations trying to get away from fair restrictions....after all the Red states only care for their rich benefactors.

 

[opckieran]

the Red states only care for their rich benefactors.

I'm sure the Californians affected by the Wildfires are thrilled that California sold their reservoirs to a couple of billionaire almond farmers. While charging some of the highest taxes of any state, mind you.

 

[The Talking Tech]

I'm sure the Californians affected by the Wildfires are thrilled that California sold their reservoirs to a couple of billionaire almond farmers. While charging some of the highest taxes of any state, mind you.

Disaster can strike any state even Texas with all their ignorance on how to handle the measles outbreak they can't seem to stop, but that doesn't mean they should serve as a safe heaven for rich corporations to get away from regulation.

 

[pnntmp]

California is openly hostile to any business, not just tech.
Regulatory frenzy is strangling everyone. Tech is ahead of the refugee wave because it's least dependent of non-movable physical stuff, but many others are fleeing or planning to.

There's hardly a company in California that hasn't at least discussed relocation.

 

[opckieran]

Disaster can strike any state even Texas with all their ignorance on how to handle the measles outbreak they can't seem to stop, but that doesn't mean they should serve as a safe heaven for rich corporations to get away from regulation.

We've already seen blatant incompetence from California in handling the wildfires. It turns out paying DIE hires $400k+ was the wrong move (imagine that!) That's no longer up for dispute.

Speaking of Measles, it's funny how Measles was eliminated from the US 2+ decades ago... but came back all of a sudden coincidentally after having such a porous border under Biden. It was the same for Tuberculosis too! Want to take bets as to which Central or South American country either came from?

 

[Kirby1]

We've already seen blatant incompetence from California in handling the wildfires. It turns out paying DIE hires $400k+ was the wrong move (imagine that!) That's no longer up for dispute.

Speaking of Measles, it's funny how Measles was eliminated from the US 2+ decades ago... but came back all of a sudden coincidentally after having such a porous border under Biden. It was the same for Tuberculosis too! Want to take bets as to which Central or South American country either came from?

Lol. You are so blatantly uninformed and proud of it, it's pathetic and laughable at the same time.

 

[opckieran]

Lol. You are so blatantly uninformed and proud of it, it's pathetic and laughable at the same time.

Lol. You are so incapable of making a counter-argument that you immediately result to an ad-hominem. It's pathetic and laughable at the same time.

 

[axiomatic13]

We've already seen blatant incompetence from California in handling the wildfires. It turns out paying DIE hires $400k+ was the wrong move (imagine that!) That's no longer up for dispute.

Speaking of Measles, it's funny how Measles was eliminated from the US 2+ decades ago... but came back all of a sudden coincidentally after having such a porous border under Biden. It was the same for Tuberculosis too! Want to take bets as to which Central or South American country either came from?

As a Texan, you are pushing misinformation here, sir. Texas outbreak started with religious anti-vaxers. Specifically, a Mennonite community in Gaines County. Cut it out with mixing your political bigotry with current events. Source: https://www.texastribune.org/2025/02/18/texas-measles-outbreak-climbs/

 

[Kirby1]

Lol. You are so incapable of making a counter-argument that you immediately result to an ad-hominem. It's pathetic and laughable at the same time.

Oh I'm fully confident that any counter argument to fully made up right wing nonsense would not have any dent on your impenetrable resolve in your beliefs.

 

[toooooot]

Is it just the cost of doing business or pure insanity Cali is sliding into for year, though?

 

[Kirby1]

The California economy is larger and stronger than any other state, by far. Clearly what they are doing is working, even if big businesses don't like it.

The California economy is bigger than almost all other nations by itself. If you think they care if some businesses leave for Texas, you are wrong.

 

[The Talking Tech]

We've already seen blatant incompetence from California in handling the wildfires. It turns out paying DIE hires $400k+ was the wrong move (imagine that!) That's no longer up for dispute.

Speaking of Measles, it's funny how Measles was eliminated from the US 2+ decades ago... but came back all of a sudden coincidentally after having such a porous border under Biden. It was the same for Tuberculosis too! Want to take bets as to which Central or South American country either came from?

To control wild fires requires massive amounts of water to be available through mountainous terrains and hundreds of firefighters synchronized and alerted to react at all times for a change in winds.....

To control measles it only requires one thing....a VACCINATION...and yet it seems a vaccination created decades ago is far more difficult to get in Texas than stopping dangerous wild fires.

Ha ha ha

 

[m3diapers]

I'm considering relocating my companies as well, but I have full-time employment with the State of California. Recently, they updated their remote work policy, stating that I cannot move out of state.

 

[nnguy2]

all the places tech is moving to in Texas are also very left and not the GOP dominated parts of Texas you MAGA think it is. Austin, Dallas, Houston, and San Antonio are blue bastions against Big Red Texas Stupid.


There's old joke asking what's the worst thing about Austin and the answer is it's surround by Texas.

 

[ScottSoapbox]

The beauty of states is that they have to compete for citizens and businesses.

It was the purpose of the United States that has largely be taken over by the *limited* federal government despite the constitution set up to limit it.

 

[GodisanAtheist]

Yeah, but then you have to live in Texas which isn't the greatest for weather or varied geography.

Say what you will about California's politics but damn the state itself has a lot to offer.

Too bad all this culture war garbage has us bogged down arguing about the wrong stuff, a couple rounds of fiscally conservative lite leadership would get Cali cleaned up and on the right track pretty quick.

Instead everyone is *** over elbows over like 15 trans athletes or whatever.

 

[maxxcool7421]

Until you send all the brown people out of country that texan white nationalists do not like ... then it is more expensive to get lower quality products

 

[Loadedaxe]

The California economy is larger and stronger than any other state, by far. Clearly what they are doing is working, even if big businesses don't like it.

The California economy is bigger than almost all other nations by itself. If you think they care if some businesses leave for Texas, you are wrong.

I can agree it's true that California has one of the largest economies in the world, and the state's policies have contributed to its growth in certain sectors, it's also important to recognize that not all businesses are thriving under those conditions.

The state's high taxes, regulatory environment, and cost of living have caused some companies to relocate to more business friendly states like Texas. While California’s economy is strong, it’s not immune to the challenges that come with balancing economic growth and the needs of businesses.

So, it's not so much about whether they "care" if businesses leave, but rather the impact on jobs and economic growth, there is a much larger forest to see than just the trees in front of you.

California is not in a good state at the moment, and hasn't been for some time.

 

[Underdog]

I can agree it's true that California has one of the largest economies in the world, and the state's policies have contributed to its growth in certain sectors, it's also important to recognize that not all businesses are thriving under those conditions.

The state's high taxes, regulatory environment, and cost of living have caused some companies to relocate to more business friendly states like Texas. While California’s economy is strong, it’s not immune to the challenges that come with balancing economic growth and the needs of businesses.

So, it's not so much about whether they "care" if businesses leave, but rather the impact on jobs and economic growth, there is a much larger forest to see than just the trees in front of you.

California is not in a good state at the moment, and hasn't been for some time.

From an outsider's point of view, I see evidence of increasing numbers of Americans having moved to Europe or currently planning the move. They appear to be unhappy with the way things are going in their country of birth and looking for a way out. Its not only Californians that are leaving but people from other states as well. When asked why they leave, what pushed them over the edge, they say just one word................"Trump".

 

[Kirby1]

I can agree it's true that California has one of the largest economies in the world, and the state's policies have contributed to its growth in certain sectors, it's also important to recognize that not all businesses are thriving under those conditions.

The state's high taxes, regulatory environment, and cost of living have caused some companies to relocate to more business friendly states like Texas. While California’s economy is strong, it’s not immune to the challenges that come with balancing economic growth and the needs of businesses.

So, it's not so much about whether they "care" if businesses leave, but rather the impact on jobs and economic growth, there is a much larger forest to see than just the trees in front of you.

California is not in a good state at the moment, and hasn't been for some time.

You seem to grasp the situation but then you implant a conclusion that makes no sense. California is doing just fine.

The fact that big businesses tend to leave is by design. California policy is working as intended. You don't have to like it, but California is doing exactly what it intends to do.

 

[Loadedaxe]

You seem to grasp the situation but then you implant a conclusion that makes no sense. California is doing just fine.

The fact that big businesses tend to leave is by design. California policy is working as intended. You don't have to like it, but California is doing exactly what it intends to do.

You apparently only read TS.
California has a budget deficit of $68 billion, one of the worst since the 1990s recession.
California has the highest poverty rate in the United States.
California's job growth is below the national average.
Layoffs in the tech industry have hurt the state's economy substantially.
California has the highest median house price in the country.
California has the highest top income tax rate in the country.
Population has dropped and violent crime has gone up in the last 4 years.

All by design! Keep up the good work!