Economy & Budget

Here’s how your city can become the next Austin, Texas

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In just three decades, the Austin region has transformed from a sleepy university and state government town into a national driver of economic activity and innovation. We are a destination city for entrepreneurs, millennials and breakfast taco aficionados.

We have added more new jobs — 350,000 in 12 years — as a percentage of our labor market than any major U.S. metro. Per capita incomes improved dramatically. All year, we field delegations from around the country to learn how Austin does it and how they can too. 

The titans of Silicon Valley met at the White House last week. The good people of the Austin region’s business and civic space come this week to respectfully share a five-point agenda we believe will create and strengthen more regions like ours.

Invest in research, technology and innovation

Congress and the White House must shoulder the lion’s share of America’s basic and translational research investment: energy, the National Institute of Health, the National Science Foundation, advanced research projects and education sciences all need funding increases.

Congress understood this when they increased these investments during the continuing resolution budget adopted this spring. We all understand that just as Amazon is buying Austin’s homegrown grocer Whole Foods, all facets of the economy are converging. America needs superiority in what’s next.

Additionally, the executive branch should accelerate their engagement with small, high-growth companies through efforts like Defense Innovation Unit Experimental, National Network for Manufacturing Innovation institutes and “smart city” competitions. 

Invest in talent

Regions like Austin need more and better-prepared talent. Austin maintains a low unemployment rate, despite 110 net new people moving here each day. We applaud the president and Congress for focusing on apprenticeships and $1 billion net workforce investment.

But if immigration is restricted, we need structured investment into information technology (IT) programming “boot camps”, year-round Pell Grants, trade-adjustment assistance and Hollings Manufacturing Extension services to train Americans — most of whom are currently employed — for emerging mid- to high-wage industries. Already, 20 percent of Austin’s open jobs are in IT and all industries are digitizing.

Invest in physical infrastructure

A symptom of success, cities like Austin are straining under rapid population growth. Improving physical infrastructure improves economic growth. Congressional passage of the FAST Act in 2015 marginally increased resources, but we need the scale of investment contemplated by the president’s $1 trillion vision. We need Congress to pass a plan which recognizes fast-growing regions by using up-to-date census data and includes states like Texas that lack new public-private highway partnerships. 

Invest in relationships

While we understand all U.S. regions did not benefit equally, withdrawing from or changing international trade agreements carries enormous risk of boycotts and market-share loss to China. We support agreements that benefit American workers, lead to open markets in emerging technologies, strongly protect intellectual property and grow jobs here at home.

Corporate tax reform

American companies pay taxes that outpace those in other developed countries. We hope Congress will send the president a tax reform bill that lowers the corporate tax rate, allows for reasonable repatriation of foreign earnings, maintains municipal tax-exempt bond status and allows employer tax credits to help employees repay student debt. We also need to facilitate venture capital investment to finance the next hundred Dells, Indeeds or Homeaways. 

We Austin residents like to think of our city as a unique place — maybe even a little weird. How we also became a global city and tech citadel is a unique narrative. Back in the 1980s, Austin won two fiercely-competitive federal competitions to create public-private research consortiums to compete in software and semiconductors against the Japanese. Only then did we become visible to global innovation companies.

We had an extraordinary economic run in the 1990s. Unemployment dropped to 1.8 percent, though jobs were highly concentrated in these two sectors. When the dot com bubble burst in 2001, Austin took a heavy hit: 30,000 jobs and $1.8 billion in payroll lost in 30 months.

The Austin region responded by creating and funding Opportunity Austin, a 14-year strategy to diversify our industry base. We employed old-fashioned “smokestack chasing” to recruit Samsung, Facebook, Under Armour and Hanger Orthopedic. We also executed efforts to improve college enrollment by 40 percent and earn taxpayer support to build the first U.S. medical school in 50 years to be affiliated with a national research university, so we could grow a new biotech industry segment. 

Finally, we’ve tried to protect those things which make our “tails wag”: the South by Southwest festival, parks, PBS’ “Austin City Limits” music show and local beer. 

So, to quote Austin’s Stevie Ray Vaughn, “We’re just trying to grow up and remain young at the same time.”  We’ve learned some things through our mistakes and successes and we want to help grow more successes. Thanks for having us, D.C. 

Mike Rollins is the president of the Austin Chamber of Commerce.

The views expressed by contributors are their own and not the views of The Hill. 

Tags Austin, Texas corporate tax rate economy Finance Money smart cities South by Southwest SXSW Texas Venture capital

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