A Look Ahead with The Economist
Texas has again claimed the “Governor’s Cup,” which Site Selection Magazine awards to the state with the most major corporate locations and expansions in the past year. It’s the eighth consecutive win for the state, and Texas has been at or near the top for some 15 years — not coincidentally, that’s about when notable economic development legislation was passed and implemented.
To be counted as a major project, initiatives must involve a capital investment of at least $1 million, 20 or more new jobs, or 20,000 square feet of new construction. In 2019, Texas had 859 such projects, far ahead of second-place Ohio (with 448), Illinois (423), Georgia (296), and Indiana (194). The number of Texas projects is also well above 2018’s 608, and the Lone Star State ranked seventh in projects on a per-capita basis — no small accomplishment given its large population.
Texas captured three of the six largest projects in terms of capital investment, as well as one of the largest for numbers of new jobs. Of note is the fact that each of these major facilities was in a different industry, reflecting the rich diversity of the state. The TI semiconductor plant in Richardson was the largest project nationwide last year, with a capital investment of some $3.1 billion. ExxonMobil Chemical is investing $2 billion in Baytown, Steel Dynamics is spending $1.9 billion in Sinton and the Elemental Processing facility in Houston, which produces yarns/fibers, will create 4,000 jobs.
In comments regarding the Cup, Governor Greg Abbott described the importance of trade agreements to Texas’ success — I couldn’t agree more. He also discussed the need for workforce training and improvements in public and higher education including efforts such as upskilling, ensuring students at all levels are prepared and that those who pursue higher education and workforce trainings can complete those programs in a cost-efficient and timely manner. In the next session he indicated that higher education should be a top priority, along with reducing regulatory burdens.
As I’ve discussed previously, Texas is facing challenges such as falling behind in attracting the most innovative workers. We also need to invest in a variety of priorities ranging from education to infrastructure. The state’s economic development programs are working, and they should be fully supported — and, in some cases, modernized.
Continued forward progress is crucial, because success doesn’t come by happenstance. It requires providing what businesses need to succeed, from a well-trained workforce to the necessary highways and water supplies. The many economic development professionals across Texas who work to enhance prosperity in their areas and the state are also essential, and the Governor’s Cup win bears tribute to their success. Eight is great, but eight is not enough.
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Dr. M. Ray Perryman is President and Chief Executive Officer of The Perryman Group (www.perrymangroup.com). He also serves as Institute Distinguished Professor of Economic Theory and Method at the International Institute for Advanced Studies.
