Economists generally agree that economic development and growth are influenced by four major factors: human resources, physical capital, natural resources and technology. Growth in human capital and physical capital often explains only half or less than half of the economic growth that occurs. Technology is one of the most important contributors to economic growth, especially in the US.
Using these parameters, we are profiling the fastest growing cities in the US. And on the top of our list in the state capital of Texas, Austin.
City of Austin
Austin, one of the sunniest cities in America enjoying 300 days of sunshine on average every year, has emerged as the second fastest growing city in the country, falling just behind the San Francisco Bay area.
An influx of heavy hitting tech companies, a high concentration of venture capital, vibrant cultural offering and a warm climate are driving Austin’s economic output and population growth.
Demographics:
Data from the Texas Water Development Board (TWDB) which is used to assist in infrastructure development and conservation efforts anticipate Texas’ statewide population to grow more than 70% in a fifty-year timespan, jumping from 29.7 million residents in 2020 to 50.5 million in 2070.
By 2040, Austin metro’s population is expected to surpass San Antonio metro population size for the first time. Under 2020 estimates, the Austin MSA’s fine county coverage areas currently have a population of 2.3 million but will be pulling in 3.3 million residents by 2040. The census recorded 961,855 people in 2020 in the current metro area. Currently, in 2023 it is at 2,228,000, a 2.39% increase from 2022.
Regions:
Some of the key growth areas surrounding the urban cores in the Austin region include counties like Bastrop, Hays and Caldwell, said Todd Danielson, VP of Engineering at Texas Water Utilities. Downtown Austin has surpassed pre-pandemic levels for development growth.
Economic Data:
Austin is the fastest growing city for millionaires, according to the 2023 Wealth Report by Henley and Partners. A millionaire growth rate of 102% puts Austin on top of the list. In a news report on regional economic trends, the American Growth Project ranked Austin as the second fastest growing city.
Lila Valencia, the city demographer of Austin, sees unemployment at very low levels and still leading in terms of growth. Valencia says that the growth that Austin has seen in the last ten years is likely to continue into the foreseeable future.
The types of industries that are growing in the area are tech, finance and real estate.
Infrastructure and Real Estate:Adam Perdue, research economist with the Texas Real estate Research Centre said that the Austin region and its leaders will need to be strategic in their planning to ensure sustainable growth. Austin today is often regarded as the best place to live in Texas as it offers its residents:
- affordable cost of living,
- fantastic job opportunities,
- unique attractions,
- and some of the best eclectic live music in the country
Art and Culture:
The city is recognized for its innovation and leadership in contributions to music, film, gaming and multidisciplinary digital experiences. Festivals such as South by Southwest (SXSW), Austin City Limits and the Fusebox Festival have made Austin a premiere cultural destination.
The city’s official slogan promotes Austin as the “The Live Music Capital of the World”. Austinites have also adopted the unofficial slogan,” Keep Austin Weird” which refers to the desire to protect small, unorganized local businesses from being overrun by large corporations. ‘Keeping Austin Weird” has been a popular local motto for years, featured on bumper stickers and T-shirts.
Global Standards:
Austin was selected as the No.2 Best Big City in ‘Best Places to Live In” by MONEY magazine as far back as 2006 and No.3 in 2009 and also the Greenest City in America by MSN.
Austin is considered a Beta – Level Global City as categorized by the Globalization of World Cities research work. Even Downtown Austin and Downtown San Antonio separated by approximately 80 miles may someday form a new ‘’metroplex’’ like Dallas and Fort Worth.
Downside:
Austin’s impressive growth has come with some not so impressive consequences such as escalating housing prices. The median home value in Austin increased from $347,156 in August 2020 to $ 566,479 in August 2022, with average multifamily rents rising 10% year over year. Cost of living in Austin is 9 % higher than the state average and 1% higher than the national average, housing is 16% more expensive than the US average while utilities are about 6% less pricey.
Conclusion:
Austin has found its unique and distinguished place in peoples’ hearts for a lot many diverse reasons. Looking at it from the perspective of business, it is a great place to explore as the city expands and evolves into a bigger metropolis. Working with AEC firms in this region, we see a potential for massive investment in real estate and development in the next decade.
Are you an AEC firm in Austin, looking for the right support to expand your business? We can help your future-proof your business and make the most of the immediate opportunities. Contact us.