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Austin, Texas: State of the Economy

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Brian Kelsey's review of the latest statistics on Austin economy, as of October 2015.

Published in: Economy & Finance
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Austin, Texas: State of the Economy

  1. 1. Brian Kelsey, Principal Civic Analytics LLC civicanalytics.com @civicanalytics Austin, TX: State of the Economy October 2015
  2. 2. 2 Presentation Topics • Review latest available indicators for Austin & regional economy. • Big splash from Kauffman on the state of entrepreneurship & tech driven growth in Austin. • Inclusive economic development. • Blame California Florida?
  3. 3. 3 Economic growth in Austin outpacing most other leading metros – 3x faster than U.S. since 2009 -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0%2014 2009-14 San Jose 5.8% 30.0% Austin 5.6% 28.5% Nashville 3.6% 19.0% Charlotte 2.3% 16.5% San Francisco 4.4% 14.5% Seattle 3.3% 13.9% Denver 4.4% 13.4% Salt Lake City 1.8% 11.8% Portland 3.7% 10.6% Raleigh-Durh 2.2% 9.7% Orlando 3.6% 5.4% U.S. Metro 2.0% 9.8% Real Annual GDP Growth (2014 Dollars) Austin U.S. Metro Portion Source: U.S. Bureau of Economic Analysis. Data is for Metropolitan Statistical Areas (MSAs).
  4. 4. 4 182,700 net new jobs created in Austin since the recession ended – ~3x faster than U.S. growth 0.0 1.0 2.0 3.0 4.0 5.0 6.0 2013Aug 2013Sep 2013Oct 2013Nov 2013Dec 2014Jan 2014Feb 2014Mar 2014Apr 2014May 2014Jun 2014Jul 2014Aug 2014Sep 2014Oct 2014Nov 2014Dec 2015Jan 2015Feb 2015Mar 2015Apr 2015May 2015Jun 2015Jul 2015Aug Job Growth, 12-Month % Change Source: U.S. Bureau of Labor Statistics (CES). Total nonfarm employment, seasonally adjusted. 2015 is YTD, January-August (p). 2009-15 is June 2009 to August 2015 (p). 2015 2009-15 Austin 2.5% 23.8% San Jose 2.7% 22.8% Nashville 2.0% 21.2% Orlando 2.5% 16.6% Salt Lake City 2.5% 15.7% Denver 0.7% 15.7% Seattle 2.0% 14.3% Portland 2.2% 14.2% Raleigh-Durh 1.2% 12.7% U.S. 1.0% 8.6%
  5. 5. 5 Austin economy is partying like it’s 1999 • Unemployment rate in Austin (city) was 2.8% in Aug—lowest period of unemployment since dot-com era. • Sales at Austin (city) businesses up nearly 5% in 2014 compared to ‘13. • Real average wages in Austin MSA increased by 1.6% in 2014 and are finally nearly back to pre-dot-com bust level (> $54,000/yr). Sources: (1) Bureau of Labor Statistics (LAUS). Not seasonally adjusted. Data is for portion of Austin in Travis County. (2) Texas Comptroller. Gross sales, adjusted for inflation. (3) Bureau of Labor Statistics (QCEW). All industries, adjusted for inflation.
  6. 6. 6 http://www.kauffman.org/microsites/kauffman-index/rankings/metropolitan-area
  7. 7. 7 Austin is among fastest growing tech markets in U.S. Tech Jobs % Tech 2013-14 Raleigh 57,838 9.5% 9.4% Durham-Chapel Hill 32,920 10.4% 7.2% San Jose 294,848 27.0% 6.4% San Francisco 236,525 9.7% 5.7% Austin 108,310 11.1% 5.3% Boston 266,409 9.6% 4.0% Seattle 175,670 8.6% 3.8% Salt Lake City 43,686 6.1% 2.6% Dallas 207,012 5.8% 2.2% Washington DC 295,106 8.8% -2.4% Nation 6,736,083 4.4% 2.6% 5.0% 6.0% 8.5% 8.9% 9.9% 11.0% 11.4% 14.8% 15.5% 16.0% Dallas Durham-Chapel Hill Boston San Jose Washington DC Austin Raleigh San Francisco Salt Lake City Seattle Projected Job Growth, ‘14-’20 Source: EMSI, 2014. Includes self-employment. Published in ATC Tech Talent Study: http://austintechnologycouncil.org/atc-shares-preliminary-findings-of-tech-talent-study.
  8. 8. 8 Austin would still have at least 1,000 “core” tech job openings per year even if every student was hired • 108,310 total jobs in tech sector • 67,546 jobs in “core” tech talent occupations w/ in-demand skills • ~2,500 to 3,500 job openings in core tech talent occupations are expected per year in Austin for 2014-2024 time period* • ~1,500 degrees and certificates in core related programs awarded by Austin area schools annually How are we defining “tech”? ATC generally follows the methodology used by TECNA/CompTIA/TechAmerica for their annual Cyberstates report.* It currently includes 49 industries. Austin’s largest tech sectors ranked by minimum of $1 billion contribution to regional gross domestic product: #1 Computer & Peripheral Equipment #2 IT Services & Applications #3 Internet & Telecommunications #4 Semiconductors #5 Software Source: EMSI, 2014. Jobs include self-employment. *Job postings are unique, de-duplicated average monthly openings advertised online during March 2014-March 2015 and include job openings at tech and non-tech businesses (i.e. total demand for core technical workers). http://austintechnologycouncil.org/atc-shares-preliminary-findings-of-tech-talent-study
  9. 9. 9http://startup-ecosystem.compass.co/ser2015/
  10. 10. 10 Austin was fastest growing (%) large metro (1M+) and city (500K+) in U.S. from July ‘13 to July ‘14 Source: U.S. Census Bureau, Population Estimates. City Population 07/01/14 Change 2013-14 Growth 2013-14 New York 8,491,079 52,700 0.6% Los Angeles 3,928,864 30,924 0.8% Chicago 2,722,389 82 0.0% Houston 2,239,558 35,752 1.6% Philadelphia 1,560,297 4,245 0.3% Phoenix 1,537,058 24,616 1.6% San Antonio 1,436,697 24,931 1.8% San Diego 1,381,069 21,225 1.6% Dallas 1,281,047 20,322 1.6% San Jose 1,015,785 11,964 1.2% Austin 912,791 25,667 2.9% Metro Population 07/01/14 Change 2013-14 Growth 2013-14 New York 20,092,883 90,797 0.5% Los Angeles 13,262,220 86,371 0.7% Chicago 9,554,598 9,802 0.1% Dallas 6,954,330 131,217 1.9% Houston 6,490,180 156,371 2.5% Philadelphia 6,051,170 14,942 0.2% Washington 6,033,737 66,561 1.1% Miami 5,929,819 66,361 1.1% Atlanta 5,614,323 88,891 1.6% Boston 4,732,161 34,112 0.7% Austin (#35) 1,943,299 57,496 3.0%
  11. 11. 11 Blame California Florida: Wealthiest movers from Bay Area/Silicon Valley, but FL leads donor states Source: Internal Revenue Service, SOI Tax Stats. To Travis Origin State Households (Tax Returns) 2011-2014 People (Exemptions) 2011-2014 Average Income (AGI Per Return) 2011-2014 Florida 30,236 47,047 $55,275 California 15,602 30,135 $81,059 Georgia 10,097 18,745 $27,446 New York 9,595 15,728 $53,557 Illinois 4,698 8,478 $56,407 North Carolina 3,541 7,994 $41,286 Arizona 3,430 7,704 $47,763 New Jersey 4,137 7,526 $45,281 Michigan 4,034 6,943 $27,611 Pennsylvania 3,521 6,008 $36,872 Tennessee 2,824 5,644 $32,388 To Travis Origin County People (Exemptions) 2013-2014 Williamson, TX 14,332 Miami-Dade, FL 6,466 Harris, TX 6,060 Los Angeles, CA 5,679 Dallas, TX 3,788 Maricopa, AZ 3,728 Broward, FL 3,675 Hays, TX 3,577 Cook, IL 3,349 Bexar, TX 2,867 Wayne, MI 2,865
  12. 12. 12 Employees Respondents Number* Difficulty Average Confidence Average 1 to 10 19 3.1 2.8 11 to 50 15 3.5 2.5 51 to 125 7 3.6 2.4 126 to 500 6 2.5 2.8 501+ 3 2.3 3.7 Total (Ans) 50 3.1 2.7 Source: ATC Tech Talent Employer Survey. Second-stage firms have reached a growth stage of $1M to $50M in receipts and 10 to 100 employees. For more on second-stage company research see Edward Lowe Foundation at http://edwardlowe.org/who-we-serve/secondstage. *Complete responses only (n = 50). Differences not statistically significant. 1 = Not difficult 2 = Somewhat difficult 3 = Difficult 4 = Very difficult 5 = Extremely difficult 1 = Not confident 2 = Somewhat confident 3 = Confident 4 = Very confident 5 = Extremely confident 0 = I don’t know Overall, how difficult is it to find qualified people to fill job openings at your company in Austin? How confident are you that Austin will be able to meet your future workforce demand? “New” Austin presents opportunities & challenges
  13. 13. 13 $38,064 $47,265 $57,357 $92,826 < High School High School Some College/Associate's Bachelor's + $38,475 $40,080 $59,994 $72,495 Black Hispanic/Latino White Asian Inclusive prosperity—ensuring as many as possible able to participate in growing economy—is critical Average Annual Earnings in Travis County for Workers Age 25+ (2013) Source: U.S. Census Bureau, Longitudinal Employer-Household Dynamics (LEHD), QWI, ACS 2014. See earnings definition on Slide 14. Average rent for 1 BR apartment was between $1,000 and $1,050 as of Oct 2015 according to various reports (Mark Sprague, Independence Title). Affordability calculated as maximum 30% total income spent on housing costs. Race categories are Race Alone using Census definition. Hispanic/Latino is Any Race. $41,880 income needed to afford average 1 BR apt in Travis County. 48% residents age 25-64 do not have completed postsecondary degree.
  14. 14. 14 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 Some perspective: Austin, TX | Raleigh, NC Average Annual Earnings for Workers Age 25+ with Bachelor’s Degree + Wake County (Raleigh, NC) Travis County (Austin, TX) Source: Census, LEHD (QWI), ACS 2014. Annual earnings is calculated by averaging quarterly earnings. Earnings include gross wages/salaries, bonuses, stock options, tips, and other gratuities, and the value of meals and lodging. Earnings do not include Old Age Survivor and Disability Insurance, health insurance, workers compensation, unemployment insurance, private pensions, and welfare funds. *Adjusted for inflation (2013 Dollars). 2013 Travis Wake < High School $38,064 $36,036 High School $47,265 $42,507 SC/Associate's $57,357 $50,292 Bachelor's + $92,826 $77,982 2009-2013* Travis Wake < High School 7.0% 3.0% High School 3.9% 0.5% SC/Associate's 2.3% -0.1% Bachelor's + 4.3% -0.4% 1996-2013* Travis Wake < High School 23.6% 18.3% High School 21.8% 14.5% SC/Associate's 23.2% 13.7% Bachelor's + 35.0% 17.4%
  15. 15. 7600 Burnet Road, Suite 108 Austin, Texas 78757 @civicanalytics http://civicanalytics.com

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