Texas Business Boom: Experts Stunned by Historic Growth

Texas Economy Soars

Texas recorded its 36th successive month of growth in March and is performing substantially better than the U.S. economy as a whole, according to figures from the Texas Workforce Commission (TWC). During the month, Texas’ seasonally adjusted nonfarm job count increased by 19,100, to a record of 14,115,700, with the total number of people working in Texas, including the self-employed, reaching 14,590,800.

The biggest gain was in leisure and hospitality, which produced another 7,300 jobs, while 3,700 were added for mining and logging and 2,400 in other services. Unemployment across Texas remained stable at 3.9 percent for the 10th month in a row compared to 4 percent in March 2023.

Strong Job Growth: 36 Months and Counting

Texas records 19,100 new jobs in March, reaching a record 14,115,700 nonfarm jobs.

Leisure and hospitality, mining and logging, and other services lead job growth.

Unemployment Remains Stable at 3.9%

Unemployment rate unchanged for the 10th month in a row.

2% annual increase in nonfarm employment, outpacing national growth rate.

Economic Growth Outpaces Nation

Texas economy grows faster than the US economy for the sixth quarter in a row.

Economic success amid border tensions.

5% Annualized GDP Growth Rate in Q4 2023

Texas economy grows faster than the US economy for the sixth quarter in a row.

According to data from the federal Bureau of Economic Analysis, one of the fastest growth rates in the country behind only South Carolina, Idaho, Utah and Nevada.

By contrast, the annualized GDP growth rate for the U.S. as a whole over this period was 3.4 percent.

Why Are So Many People Moving To Texas?

According to the Realtor.com report, more than one in four homebuyers looking to purchase a property in Texas are coming from outside the state.

A majority of those looking to relocate to the Lone Star State are from outside the country or from California—one of the most expensive housing markets in the nation.

Housing, Jobs, and Climate are the Most Common Reasons People Move to Texas From Other States

The Texas economy is a model for other states.

Residents are attracted to Texas first and foremost for its affordable housing, followed by its favorable climate and abundant jobs.

Why Are Homes So Affordable In Texas?

Despite a rise in home prices during the pandemic, when demand grew in the state due to the influx of newcomers, the median-price home in the state has remained cheaper than the national median for quite a while.

As of December 2024, the latest data made available by Realtor.com, the median listing price in Texas was $360,000, roughly $40,000 below the national median.

Almost half (47.5 percent) of all for-sale inventory in Texas last year was priced at $350,000 or below, against just 40.1 percent of national inventory.

Operation Lone Star: A Struggle Against Illegal Crossings

Operation Lone Star, a significant initiative launched by Governor Greg Abbott, aims to combat illegal crossings into Texas. Since its inception in 2021, the operation has seen the detention of over 507,200 suspected undocumented migrants. This figure underscores the persistent challenge of illegal immigration at the southern border, a topic of intense debate both within and outside Texas.

The implementation of various measures, including the deployment of patrol boats and floating barriers in the Rio Grande River, reflects the state’s commitment to securing its borders. Despite federal and state tensions, particularly following the Supreme Court’s decision on the removal of razor wire along the border, Texas continues to assert its role in border security under the banner of “constitutional right to defend itself.”

Housing and Population Growth

Affordable Housing Fuels Population Boom

Texas’ affordable housing has been a significant catalyst for the state’s population boom. A recent report from Realtor.com shared with Morningpicker highlights that Texas has seen an influx of over 2 million new residents since 2020. This growth is largely attributed to the state’s relatively lower cost of living and abundant housing options, creating a welcoming environment for new residents.

The state has been proactive in building new homes to meet the rising demand, with a prominent share of new construction permits issued. According to the report, Texas approved 15 percent of all new house permits in the United States, significantly outpacing its 9 percent share of the U.S. population. This surge in housing inventory is expected to gradually normalize home price growth, making the market more balanced and sustainable.

Why People Are Moving to Texas

The allure of Texas extends beyond affordable housing. The state’s thriving job market and favorable climate are key factors attracting individuals and families from all over. For many, the prospect of finding stable and well-paying employment in sectors such as technology, education, manufacturing, and construction is a significant draw. In particular, the state’s robust job market has seen consistent growth, adding 270,700 nonfarm jobs from March 2023 to March 2024, a 2 percent annual increase.

Californians and international buyers have been leading the charge in the Texas housing market. The state’s median listing price of $360,000, significantly lower than California’s $749,000, has made Texas an attractive destination for those seeking to relocate. With a substantial portion of for-sale inventory priced at $350,000 or below, the state offers a more accessible path to homeownership compared to many other parts of the country.

Implications and Analysis

Texas’ Economic Model for Other States

Texas’ economic model stands as a beacon for other states grappling with similar challenges. The state’s key strengths lie in its affordable housing, favorable climate, and abundant job opportunities. These factors have not only attracted domestic migrants but have also drawn international buyers, further solidifying Texas as a hub for economic activity.

Realtor.com’s CEO, Damian Eales, underscores the state’s potential to become the largest state by 2045, driven by the continued influx of new residents and the state’s ability to integrate and support this growth. The robust construction of new homes and the expansion of job opportunities have created a self-sustaining cycle of growth, which other states may seek to emulate.

Softening Home Price Growth Ahead

As the housing market in Texas continues to evolve, a shift in home price growth is anticipated. The influx of new inventory is anticipated to slow the rate of price increases, making the market more stable and accessible. This trend not only benefits potential buyers but also supports developers and real estate professionals, fostering a balanced and sustainable real estate sector.

The construction boom in Texas, with 15 percent of all new home permits issued in the U.S., illustrates the state’s proactive approach to addressing housing demand. The state’s strategic investment in infrastructure and workforce development is critical to sustaining this growth, ensuring that Texas remains a leader in economic development and population growth.