According to preliminary data released by the U.S. Bureau of Economic Analysis, jobs in Austin are fueling strong Austin economic growth. Austin’s economy is the second in the nation for growth. Jobs in Austin continue to be abundant, contributing to strong local GDP (Gross Domestic Product) growth.
Last year, Austin GDP grew by 5 percent. San Antonio-based economist Keith Phillips indicated that GDP growth is supported by strong growth of jobs in Austin.
Jobs in Austin
“It’s consistent with the story we saw last year of strong job growth,” said Phillips. He also said that the Austin 5 percent GDP growth is “consistent with what we saw with employment numbers.” It’s also possible that Austin’s economic growth rate for 2015 is stronger than that of San Antonio. San Antonio is reported as having the top economic growth rate of 5.9 percent.
“Something is wrong in the numbers,” said Phillips. “Real GDP growth of 3.4 percent for San Antonio is closer to the truth.”
Austin Economic Growth
Last year, the Austin economy appeared to be largely insulated from the decline in the energy sector that affected most of Texas. “The contagion from the decline in the energy sector didn’t hit the I-35 corridor,” Phillips said. That’s because the Austin economy is diverse enough to withstand a decline in any one industry.
Growth in Austin was led by the professional and business services sector, which grew by 1.6 percentage points, according to data from The Bureau of Economic Analysis. That sector has been fueled by population gains in the region, which is also tied to booming Austin employment from major companies.
“It’s no surprise that the professional services areas is where most of the GDP growth has occurred. Many of the jobs in professional services are jobs of population growth,” Austin economist Angelos Angelou said.
Strong Austin population growth continues to be fueled by workers from across the country who are attracted to the plentiful jobs in Austin. Austin economist Jon Hockenyos said the region is evolving as a modern economy that continues to attract both skilled labor and in-demand jobs.
For example, both workers and employers in the professional and business services see Austin as an appealing destination. Workers in that sector have flexibility on where they can call home. They’re attracted to Austin’s innovative vibe and rich cultural scene.
Austin Represents the Modern Economy
“We continue to be the place where the modern economy wants to be,” Hockenyos said. “We’ve had a lot of population growth and among people that are with skill sets that are aligned with the modern economy.”
Compared to such markets as Silicon Valley, Austin offers a rich quality of life for a fraction of the cost. That combination of area amenities and affordability are key for professional and business service workers, Hockenyos said.
“Folks who have those capacities have a fair amount of flexibility on where they want to work, and companies have a fair amount of flexibility on where they want to be and Austin offers a value package. A super quality of life at a reasonable price — especially compared to the (San Francisco) Bay Area,” he said.
Outlook for the Austin Economy
Jobs in Austin are continually being fueled by expanding tech giants in the area. Employers like Facebook and Google are employing more Austinites as their businesses flourish. The big tech employers are key to future Austin employment and economic growth. Now, the health and education sector is about to become a Austin employment contributor. The new University of Texas medical school is expected to be a major employer in the health and education center.
Other major sources of local jobs — state government, real estate development, technology, education and what Angelou calls the “festival economy,” which includes events such as this weekend’s Austin City Limits Music Festival and the F1 race later this month — will keep that engine revving, he said.
The Austin economy has a lot going for it. It’s a diverse and stable economy that’s been built and supported by innovative thinking. Austin’s economic growth last year proves that it has what it takes to thrive during an industry decline. It’s continuing to prove that it has what it takes to continue to flourish long-term.
Read more about the Austin economy.