2017 Regional Report: The Southwest


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Rapid advances in IT have propelled the growth of almost every industry from manufacturing to agriculture. Yet technology itself also has allowed companies to easily tap the talent of knowledge-based workers virtually anywhere in the world. Firms that rely on software engineers and data scientists are no longer confined to places like Silicon Valley, San Francisco or even Boston.

“Tech companies are moving to lower-cost parts of the country, changing the economy in many states by bringing opportunity, diversification and innovation in new industries.

Tech companies of all sizes are quickly moving to lower-cost parts of the country, a migration that is changing the economy in many states by bringing opportunity, diversification and innovation in new industries. In the agricultural state of Arkansas, educational initiatives and the presence of Walmart’s growing global headquarters have given birth to a robust IT industry. Piggybacking off the talent, IT firms from as far away as Massachusetts and California are moving operations to the state.

In Oklahoma, billions of dollars worth of urban quality-of-life investments have attracted millennials, who are catapulting the state’s capital into a prime place for opportunity. Next door in New Mexico, Facebook’s decision to construct a world-class data center in Albuquerque is putting that state on the tech-development map. In Arizona, a robust talent pool is helping to grow one of the country’s largest hubs for the financial services industry. And in Texas, the country’s fastest-growing metropolitan areas continue to boom despite a fallout in oil prices.


NO. 1 TEXAS

AUSTIN AND SAN ANTONIO ARE MERGING TO BECOME THE COUNTRY’S FASTEST-GROWING METROPOLIS

San Marcos serves as a connector between San Antonio and Austin.
San Marcos serves as a connector between San Antonio and Austin.

While the Lone Star state’s growth has been cooling under the collapse of oil prices, Texas still boasts one of the fastest-growing regions in the country. Joel Kotkin, executive director of the Center for Opportunity Urbanism in Houston, Texas, recently said in an article on Forbes.com that the region between San Antonio and Austin will become “America’s Next Great Metropolis.”

“Austin-Round Rock and San Antonio-New Braunfels each had the highest GDP growth of any metropolitan area in the nation last year, 5% and 5.9% respectively.

According to data from the U.S. Bureau of Economic Analysis, Austin-Round Rock and San Antonio-New Braunfels each had the highest GDP growth of any metropolitan area in the nation last year, 5 percent and 5.9 percent respectively. That’s more than double the 2.5 percent average of U.S. metropolitan areas. With only 80 miles between the two cities, the booming economies are seamlessly blending to encompass the smaller cities between them.

Places like New Braunfels and San Marcos are now seeing historic economic and population growth. While Austin has had a thriving tech scene for years, San Antonio has been following a similar path in tech and manufacturing. Jenna Saucedo-Herrera, president and CEO at the San Antonio Economic Development Foundation, says the Alamo City is forecasted to grow by 1 million residents by the year 2040.

She says growth in many sectors has been fueled by private investment. Graham Weston, founder of Rackspace, also recently helped spark the development of a tech district in the city center since launching Geekdom in 2011.

The co-working technology center has created a thriving technology industry that attracted more than $50 million in venture capital. Saucedo-Herrera says San Antonio also boasts a rapidly growing cybersecurity industry that has the second-largest concentration of assets outside of Washington, D.C.

Other companies that recently made investments or expansions in San Antonio include GM Financial, Rev-Ignition, MCCI Medical Group, EControls, Dialpad, Liquid Web, Dizzion and Jungle Disk. Some companies are even moving from Austin to San Antonio. Dragonflyware and EasyExpunctions. com both recently announced relocations to San Antonio.

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Craig Guillot
Craig Guillot is a business writer based in New Orleans, La. His work has appeared in Wall Street Journal, Entrepreneur, CNNMoney.com and CNBC.com. You can read more about his work at www.craigdguillot.com.

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