Austin a Magnet for Jobs
In the winners and losers category, Austin, Texas is Among the Covid Winners for job creation.
Texas’ capital is attracting more corporate jobs and remote workers than ever before, lured by lower costs and lower taxes. Business relocations to Austin announced this year are expected to create nearly 10,000 jobs. That is the city’s highest figure on record for a single year, according to the Austin Chamber of Commerce, and is helping offset the hit from Covid-19 to the city’s tourist-dependent restaurants, bars and music venues.
It helps that Texas has no state income tax, that Austin winters are relatively short and mild, and that social distancing is easier in a city where homes tend to be roomy and many have backyards. Austin has also managed to remain cheaper than San Francisco, Brooklyn and Manhattan by building tens of thousands of apartments over the past decade.
“It’s just a whole lot easier to hire. It’s a lot easier to get housing. It’s a lot easier to get business licenses than it is in other places,” said Greg Schwartz, chief executive of real-estate startup Tomo Networks. His company, based in Stamford, Conn., is preparing to open a co-headquarters in Austin.
Low Taxes Attract Companies and People
Contrast Texas with Illinois. The Illinois solution is five fold.
- Higher personal taxes
- Higher corporate taxes
- Higher property taxes
- Higher sales taxes
- Higher taxes disguised as fees
Illinois Exodus
The Illinois Policy Institute says BLAME ILLINOIS EXODUS ON JOBS, HOUSING, TAX POLICY
Illinois lost more than 850,000 residents to other states during the past decade, causing the state’s population to shrink for six consecutive years and suffer the largest raw decline of any state in the 2010s.
According to U.S. Census Bureau data released June 25, the white population shrank by 5.3%, or 438,986 people, and the Black population declined by 1.7%, or 32,143, since 2010.
Feed the Public Pensions
Illinois needs higher taxes to feed its broken pension system.
Illinois is the “least friendly” total state and local tax burden for the middle class, according to personal finance site Kiplinger.
It has the largest raw population decline over the past decade, with the high state and local tax burden the most common reason residents say they want to leave.
Illinois is Pension Crisis Ground Zero
For discussion of the plight of Illinois and all such states beholden to public unions, please see Illinois Is Ground Zero for the Pension Crisis
Symptom vs the Problem
The pension crisis is not the problem, it is a symptom of the problem.
The true problem is decades of corrupt politicians getting in bed with corrupt public unions.
Dead on Arrival
Given that Republicans held the US Senate, a state bailout and Biden’s Progressive Agenda is Dead on Arrival in January.
Time is running out for Illinois.
Mish
Larry Ellison won’t be moving to Austin. He’s going to continue to work from home….He owns Lanai, pretty much. One of those islands we call Hawaii.
He likes islands, apparently. He used to own a house on a private island adjacent to Tortola, BVI. It was for sale for $50M…not sure if it sold or not.
As someone already reported on another thread, Oracle announced yesterday they are moving their headquarters to Austin.
Are taxes actually lower in Austin? I ran the numbers and when you add in high property taxes in TX and weigh them against high income taxes in CA it’s basically a wash.
In the city proper the 2020 rate is 2.557…..out in the county, in the close-in suburb where I live it’s only 1.86.
So, yes, property taxes are pretty high.
In the old days you figured you got your moneys worth because most of it went to the local schools…now they have a court mandated system where part of our school taxes go to another district.
I have property in both CA and TX. One has to compare the tax rate AND the actual taxes. TX has the higher rate, but since housing is so expensive to buy (where I lived in the SF Bay Area the $/sq ft would be something like 4x that of the areas surrounding Austin), the actual tax paid is MUCH higher in CA. If Austin homes ever appreciated to the level of the Bay Area, the tax paid would of course be higher, even compare to CA.
Median home price has gone from $246K to $357K just since 2015….we’re on our way to catching up.
Most execs and professionals live in neighborhoods where the home price is now typically a million or more. ]
I also heard miscellaneous fees are popping up all over.
Mish,
Those two Republicans in the Georgia US Senate runoff will lose. The real conservatives will sit that one out. Better to let the RINOs go extinct. I prefer the FSA any day, no pretense with them.
You know who was on the other side of that phone call where Illinois Governor Blago was saying “this thing is f-ing golden!” (Filling the Obama Senate seat)? That would be current Governor Fatso. Don’t expect the FBI to take down that corrupt blimp.
Austin does not have way kewl places like the Ann Sather Restaurant. It’s run like a speakeasy to circumvent the COVID restrictions by Governor Fatso and Mayor Lootfoot. Go to the back door and tell ‘em Alderman Tom Tunney sent you, ask for the “sticky buns”. That’s the password.
I don’t understand why big American cities are garbage? Prague, Warsaw and Belgrade are all large with all major amenities yet they are fairly well organized, clean, low crime etc.
The way ive always looked at it. Its all proportional. How much you make an hour verses how much it cost to live Taxes are taxes the govment gonna get theres one way or another. Cities grow and become more expensive / homeless /drugs etc. wait till elon gets busted for weed.
Because the cops have difficulty distinguishing the CBD pot (now legal here) from pot that contains THC, Austin has stopped busting people for simple possession altogether. We also have a new progressive leaning DA who thinks drug laws are unfairly enforced against black and brown people.
Party on Garth.
Texas is absolutely the hottest and most insufferable state in the entire nation. Forget about Death Valley, Arizona, Nevada, Florida—none of them measures up. Texas alone has the right to be known as Number One, the worst.
This distinction has not been established merely by consensus or legend, but by scientific investigation. The proof may be found right on page 50 in a little text called Environmental Physiology, a book written by and for doctors who study how we adapt—or fail to adapt—to things like climatic conditions. I quote with italics added:
A review of worldwide effective temperature data for summer reveals that the Red Sea and the Indus Valley are the worst. In the United States the lower Rio Grande Valley and a section of the Gulf Coast are worst. These values are even worse than those for typical tropical areas, such as Devil’s Island in Guiana.
There you have it—even worse than Devil’s Island. A summer more sweltering than a tropical island’s. And that’s in terms of “effective temperature,” which is not simply the reading on a mercury thermometer, but an index that takes into account humidity and air movement as well—similar to the chill factor which combines the effects of wind and temperature. There are a handful of other similarly sophisticated indicators—the discomfort index, the temperature-humidity index, desert equivalent temperature—all of which add up to the same conclusion: Texas, all climatic factors considered, is unquestionably the hottest.
Just how hot? Well, along the Rio Grande, we’re talking about an average —that’s day and night—desert equivalent temperature* of 102° Fahrenheit every summer.
Texas is a big state. The part of the state you’e referencing there is the northern part of the Sonoran Desert. The population is pretty low in most parts of it. They find the desiccated bodies of illegal immigrants out there on a regular basis.
Not all Texas is quite that miserable. I remember what it was like growing up in Deep East Texas before air-conditioning…..in the houses we build today, it’d be miserable…but houses were built much different then……high ceilings, lots of big windows that opened.
Austin is very hot in the summer….but it’s pretty nice this time of year…..like late fall in most places….the leaves are still falling….mid 40’s last night. 74 degrees F right now and clear and sunny.
I spent 2 years in Dallas, Houston, and Austin looking very closely at the outsides of buildings(forensic inspections for lawsuits)–it’s far too hot for me to think of it as being a desirable place to be in the summer. I visit relatives there in the winter and spring, but otherwise, no thanks!
“Contrast Texas with Illinois. The Illinois solution is five fold.”
Correct. Texas has no personal income tax.
In either (or any) state there is a federal corporate tax of 21%. There is no additional corporate tax in Texas…..but Illinois has a state corporate income tax of 5.25 and an additional 2.5% “replacement tax” whatever the F that is…. so a total of 28.75% .
Correct…but only because IL property taxes are off-the-charts……at (county tax rate) 2.89% (avg)…..(more than 2X the national avg).
Texas property taxes are high-ish too, at (avg county rate) 1.80).
Property taxes are what fund schools in Texas. Some few public schools in Texas are good…most aren’t. Not sure about Illinois. But I think people blame schools too much for the poor education level….I say you can lead a horse to water, but…..
Combined sales tax in Chicago is 10.25%. Austin is 8.25%…Both are high. The state portion is 6.25% in both cities…..cities in both states are allowed to tack on a little more.
We have that too…but my son lives in Chicago… and I think Illinois does beat Texas on that stuff….but we’re catching up. I can remember when most licenses and fees in Texas were fairly nominal…not anymore.
Austin is probably the best of both worlds. You get to have relatively open minded neighbors in a Democratic county with the low taxes of an extremely conservative Republican state. It doesn’t surprise me that they would attract people from out of state.
There’s some nice places in Texas but overall not the place I would prefer to live. Sprawling, urban congestion and ridiculous property taxes. Not to mention, it’s now a swing state. Bush won it by over 20 points, McCain by 12, Romney by 16, Trump by 9 and 5.5 in 2020.
Houses as far as the eye can see !
Mish – Illinois has been a walking zombie for years. In fact the entire midwest is just a zombie economy left behind by globalization. Pittsburgh may be the lone exception.
I grew up in Texas and left in the late 1990s. Texas now has rapid uncontrolled growth similar to California or New York in the 1980s and 1990s. My acquaintances in Dallas, Houston and Austin commute longer than an 1 hour each way when they do have to go to work, which is more often now than it was a few months ago. Quality of life was miserable in Texas when I left. I can only imagine what its like now. My commute to work here in California is about 3 minutes. My kids school is 10 minutes away and my house is worth 50% more than what it was when we bought in 2011. People complain about high taxes or regulations here but I always saw too much growth in California back in the 80s or 90s, which is now more sustainable as people leave. My area is has 50% more population than 10 years ago. You have to make good money to live almost anywhere in California but it is getting more sustainable as some people leave. California and New York always have international people with money coming in. This is also a huge factor that doesn’t account for migration. Texas is a middle class existence with traffic to go with it no matter where you go. It is the large employers/employees state with all the traffic to go with it. You can also have low quality housing, tornadoes and hurricanes to go with it. I grew up in that so I know. Texas is all about quantity not quality.
I’m not a California basher. I’ve spent a lot of time there and it’s one of my favorite getaways…..but climate change has changed everything…..the fires have devastated some of my favorite destinations..it’ll never be the same in my lifetime. Used to think I’d like to live there..but now, not so much.
Both states are big…..lots of different kinds of country…..hard to beat Cali for sheer beauty…and I love the hot springs country up north of the wine country….and I like SF better than most cities….Texas has lost its connection to history….all the old buildings get torn down here….too much sprawl….plenty of that in Southern California, of course.
California seems like it has a split personality…..nothing but gentrification and upscaling in coastal California…..no slums….the trailer parks are all hidden from view.
But over on the eastern border you find the poor people. In Texas, the upper and lower classes live closer together.
That’s how California was in the 1980s and 1990s. I wouldn’t say more classes live together in Texas. No one is living in the hood of Jerry Jones, Mark Cuban or Tilman Ferttita.
You can walk from Joe Rogan’s to the hood…..or what used to be the hood….it’s gentrifying as we speak…has been since I came to town in the late 80’s.
Went to high school in Houston and under grad in Lubbock. We use to say the only difference between Houston and Hell was that Hell was more of a dry heat.
What year did you graduate Tech?
Bullshit. My house in Austin is an executive 3200 sq. ft. home and is built for Texas’ tough summers and handles the winter fine. My house in California – stucco, chicken wire, wood frame, and not much insulation. And Texas has not lost its connection to history. We teach Texas History in nearly every elementary and middle school grade, dude.
Mr. “My house in California” wants to teach me about Texas’s connection to history.
My family has now lived in Texas for six generations, and I think know a great deal about Texas history…..and even the fact that it’s taught in school, since I first took it in public school here myself, some fifty or so years ago.
My father’s family came here in 1855. My great great uncle on my mother’s side, who was a major in the Confederate Army, brought my mother’s family here after the Civil War. After serving for four years under Lee.
My great great grandfather , his brother-in-law, was killed three days before Antietam, early in Lee’s first Maryland campaign.
I still read Texas history all the time. I favor guys like J.W. Wilbarger and Rip Ford….who might not be considered politically correct these days, since they were Indian fighters and Texas Rangers.
I cut my teeth on John Graves…..You ever read Goodbye to a River? I have a first of that one, which I personally got him to sign in his later years, one year when he was a featured speaker at the Texas Book Fair.
What I meant, Mr. Weiss, was that we don’t preserve much of our historic heritage……our cities only have a tiny bit of architecture remaining even from the late 19th century.
San Francisco is full of historic architecture, the parts that didn’t burn in 1906.
Compare that to Dallas, or Houston. Houston has The Heights…….Dallas? What does Dallas have…..the Grassy Knoll? Deep Elum, maybe.
Austin has the Bremond block.
I could have bought one of those houses on the Bremond block….. many years ago…I looked at it…..we wanted it…but it looked like a money sink. I bought a new house instead.
I’m sure your house in Austin is very nice……mine’s okay too. Mine is a bit of an energy hog, though. It was built in the early 90’s…..high in the Barton Creek canyon….it has a view for miles.
Haha Short mild winters translates into brutal hot summers
970 degrees F. Please don’t come here. We call it the Yankee Killer. Summer is 6 months long and HOT.
How To Turn A Red State Blue 101
Funny, Austin was always the Boston of Texas.
Can’t stand the heat, so I’ll stay out of the kitchen.
But going to Bolivar in the spring…
A little ray of sunshine in an otherwise dark and dreary time.
Austin was already set to explode, with Apple building a huge new campus here already (including a hotel onsite)…..and Tesla working very quickly to get the new truck (and battery?) factory going, the last few months.
Anybody wanna buy my ranch? I have to pay back my bailout.