Based on a survey of CEOs nationwide, Chief Executive Magazine once again named Texas the best state to do business in for the 16th year in a row.
Can you guess which state places last? California. And just one spot above California? New York.
It should come as no surprise then that businesses are leaving California and New York in droves for the greener pastures of Texas where low business taxes, friendly regulators, and a diverse and growing labor force are big draws.
Where the jobs go, so do the workers who are drawn to Texas for the relatively low cost of living and high quality of life.
Texas has been a fast-growing state for more than a century, incredibly, growing more than twice as fast as the U.S. as a whole. This growth is only expected to accelerate with the recent spotlight shone brightly on Texas in the wake of COVID-19.
A variety of factors including Californians and New Yorkers escaping draconian pandemic-related lockdowns and restrictions and unfavorable treatment of 1099 workers have accelerated the most recent wave of migration to the Lone Star state.
Texas stands out from other states in that the percentage of population growth due to domestic migration (from other states) is higher than almost any other state.
Just as immigrants from the world over have flocked to the United States over the past couple of centuries seeking a better way of life, so too have migrants from all over the country have flocked to Texas seeking a better life, where the dollar goes farther and the government, for the most part, stays out of their personal lives.
Here are the numbers to back up Texas as the promised land narrative:
Of Texas’ total population growth between 2010 and 2016, migration accounted for almost exactly half. Net domestic migration – arrivals to and from other U.S. states – represented about 32 percent of the total increase, with net international immigration accounting for 19 percent.
Think about that for a moment. Texas shares a border with Mexico and net domestic migration outpaced immigrant migration by 13 percentage points during this time. “Natural increase,” the population change due to in-state births less in-state deaths, represented 49 percent of the state’s net growth.
Compare Texas’ migration pattern with that of California. In the same period, net migration accounted for just 22 percent of California’s population increase, and all those gains represented international immigration; the state’s domestic migration turned negative, with a net loss of more than 383,000 residents to other states.
And guess where Californians are going? Texas, where during that 2010-2016 period, Texas led all states in net domestic migration, with nearly 867,000 new residents. California ranked #3 at the bottom of all states with a net domestic migration loss of -336,359.
So where in Texas are the out-of-state migrants moving to? Its big cities, where jobs and economic opportunities abound.
Texas currently has three of the nation’s 10 most populous cities:
- Houston – 4th Place
- San Antonio – 7th Place
- Dallas – 9th Place
And two of it’s 10 largest metropolitan areas:
- Dallas – Fort Worth – Arlington – 4th Place
- Houston – The Woodlands – Sugar Land – 5th Place
According to a recent Business Insider article, Texas had six of the 25 fastest growing cities in the U.S.
Those who come to Texas find out why native Texans never leave: the quality of life can’t be beaten. The taxes are low here with the nation’s fifth-lowest state and local tax burden.
In the year ending in March 2020, Texas added more jobs (nearly 279,900) than any other state. All the migration to Texas has led to a real estate boom where supply struggles to keep up with demand. Housing at all levels is strained as workers of all skill and education levels flock to Texas. And the wave of migration is only expected to accelerate based on recent trends.
This means the demand for housing and commercial space to house workers and businesses moving to Texas is expected to boom.
It’s clear that right now, Texas is not only a land of opportunity for workers and businesses but investors as well – those investors looking to cash in on Texas’ migration trends.
Kyle Jones is a co-founder and Key Principal of TruePoint Capital, LLC. Kyle is responsible for the company’s strategic planning, investment decisions, asset management, and overseeing all aspects of the company’s financial activities, operations, and investor relations.
Kyle obtained a Bachelor of Science degree from Texas State University – San Marcos, where he also played Division 1 Baseball.