7 Reasons to Start a Business in Texas
Unsurprisingly, Texas has consistently ranked among the top states in the nation for business. With new business formation at a five-year high, Fortune 500 companies and small businesses alike are finding many reasons to set up shop in the Lone Star State.
Why You Should Consider Starting a Business in Texas:
1. Prospering Economy
According to Forbes, the $1.8 billion Texas economy is the second largest in the nation, trailing only California. Not to mention, 102 of the 1,000 largest public and private companies in the United States are based in Texas, including 22 Fortune 500 companies.
In addition, Texas is a leader in private-sector job creation and has consistently maintained a low unemployment rate. According to CNBC, Texas added more than 350,000 jobs in the past year. And, as of September 2018, Texas’ unemployment rate of 3.8 percent was its lowest rate in 40 years, according to the Texas Workforce Commission and Texas Policy Foundation.
2. Business-Friendly Tax Environment
Texas doesn’t levy a state-level personal or corporate income tax, making it a relatively inexpensive location to start a business compared to many other states. The state also offers other incentives, including sales tax exemption for manufacturing machinery, equipment, research, and development-related materials, as well as franchise tax exemption for many small businesses.
3. Central Location and Affordable Cost of Living
According to Sperling’s Best Places, the cost of living index in Texas is 101.8 — just a notch above the U.S. average of 100. Housing is the number one factor affecting this score, with a median home price in Texas of $184,900. Texas also boasts two of the largest airports in the world – Dallas/Fort Worth International Airport and George Bush Intercontinental Airport in Houston rank third and sixth, respectively, giving Texas business travelers numerous flight options.
4. World-Class Infrastructure
Texas has more miles of public roadways, state highways, and freight railways than any state in the nation, according to American Infrastructure magazine. The state is also home to more bridges and airports, contributing to its position as the top exporting state in the country. Texas’ continued investment in its infrastructure and alternative sources of sustainable energy is another reason why the state is a hotbed for innovation and entrepreneurship.
5. Skilled Workforce
Texas’ rapidly growing population and highly ranked schools contribute to its diverse and talented workforce. According to Go Big in Texas, the state’s 13 million workers makes it the second largest civilian workforce in America, and that number continues to grow.
Texas’ population has grown by more than any other state since 2000, perhaps because it boasts the fastest income growth in the U.S. Plus, the state’s impressive line-up of colleges and universities, including Rice University, University of Texas, Texas A&M, and Southern Methodist University, feed a strong pipeline of talent into the Texas workforce.
6. Industry Leadership
Most people think of Texas as oil country. As the number one producer in the U.S., Texas accounts for more than 40 percent of the country’s output. However, the state has also established itself as a leader in the technology sector, attracting a multitude of start-up companies. In fact, its capital city Austin is now referred to as the “Silicon Valley of the South,” given its strong pull of talent from outside states and foreign countries alike — another reason why business is booming in the Lone Star State. According to the Kauffman Growth Entrepreneurship Index, Texas ranked second in Startup Activity, eighteenth in Main Street Entrepreneurship, and fifth in Growth Entrepreneurship as of October 2017.
Are You Ready to Open a Texas-Based Business?
It’s easy to see why business owners are attracted to Texas. If you’re looking for a home for your small business, consider the Lone Star State. You might find that the advantages it offers are exactly what your business needs to thrive.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.