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U.S. Regions
Marketing the Lone Star State
"It ain't braggin' if it's true," proclaimed a recent exhibit at the new Texas State History Museum in Austin, as it told the story of notable Texans, both outlandish and inspirational, from Davy Crockett to Lance Armstrong. The exhibit did not highlight the state's business environment, but it easily could have. As a location for business, Texas has plenty of bragging rights.
"Texas was built on the dreams of entrepreneurs and adventurers who dared to chart their own path to success," says Governor Rick Perry. "That's still true today. With developed infrastructure, outstanding education and research resources, a skilled workforce and low taxes, Texas is a haven for businesses that use the resources of human innovation to make the impossible possible. Some might call that our state's renegade spirit, but we call it the way progress is made."
Long known for its vast, cattle-filled plains, its cotton fields and oil fields, Texas' uniqueness as a 21st century business center comes from the unexpected: a high-tech sector that rivals Silicon Valley; a vibrant biosciences sector growing amidst renowned medical centers and research universities; dynamic international commerce; and a state government that helps rather than hinders business.
Texas' New Economy
Traditionally, agriculture and energy carried the state's economy. While still strong, these industries now share the economic spotlight with high-tech, telecommunications, and biosciences firms. Companies in many industries feel at home in Texas.
One of the state's fastest-growing industries is biosciences, which builds upon the work being done at Texas' premier research institutions. Companies specializing in healthcare technology have grown up around the Texas Medical Center and M.D. Anderson Cancer Center in Houston. Agricultural biotechnology research thrives at the state's universities, most notably Texas A&M and Texas Tech.
One of the state's fastest-growing industries is biosciences, which builds upon the work being done at Texas' premier research institutions. Companies specializing in healthcare technology have grown up around the Texas Medical Center and M.D. Anderson Cancer Center in Houston. Agricultural biotechnology research thrives at the state's universities, most notably Texas A&M and Texas Tech.
The Telecom Corridor, centered in Richardson, is home to the nation's highest concentration of telecommunications equipment companies, with more than 350 located within two square miles.
Deep in the heart of Texas, Austin's computer hardware and software companies, and semiconductor fabricators and suppliers, have established the area as one of the world's premier high-tech centers. Entrepreneurial spirit, combined with technical know-how, has given birth to a growing number of start-up companies in the high-tech arena.
The nation's armed forces recognize Texas' advanced technology and manufacturing strength. The next-generation Joint Strike Fighter jets, which represent the Pentagon's largest-ever contract, will be manufactured in Lockheed's Fort Worth facility.
Some of the state's long-established business sectors also depend on high-tech brainpower. The romance and derring-do of wildcat oil strikes have yielded to technological sophistication, and Houston, widely recognized as the nation's energy capital, has developed a large software industry to support oil and gas exploration.
NASA's Johnson Space Center, also located in Houston, is at the heart of the nation's space exploration ventures and employs a large pool of engineers and technicians. The National Science Foundation reports that Texas universities produce the nation's third-highest number of scientists and engineers, meaning that Texas' knowledge-based companies never have to look far for talent.
That has been the case for Affiliated Computer Services, a global business process and knowledge services firm headquartered in Dallas. The company employs both knowledge and client service workers, and, says chief marketing officer Lesley Pool, "The tremendous talent pool of experienced, knowledgeable workers here is a key factor in our success." One of FORTUNE magazine's "Most Admired Companies" in 2002, ACS continues to grow and take advantage of the strong local workforce.
As have other states, Texas has seen unemployment rise over the past year. Over the past decade, however, Texas created more manufacturing jobs and more jobs overall than any other state, underscoring the strength of the economy and workforce.
Unique Relationship With Mexico
Companies whose business plans include Mexico can find no better location than Texas. Mexico and Texas have deep ties that predate the North American Free Trade Agreement by centuries. That historical relationship translates into a strong business relationship. Mexico is Texas' top trading partner, with just under half of Texas exports going south of the border. Thirty international bridges cross the shared 1,248-mile frontier. Laredo, at the southern terminus of Interstate Highway 35, is the main port of entry for Mexican goods.
El Paso, Texas and Ciudad Juarez, Mexico form North America's largest metropolitan border area, home to a large concentration of production-sharing facilities, also called twin plants, or maquiladoras. U.S. companies manufacture in Juarez and warehouse in El Paso to take advantage of Mexico's lower production costs and El Paso's presence on the Interstate Highway System.
Texas was the first U.S. state to establish a state-supported business office in Mexico, which has served Texas companies wanting to do business south of the border for the past 30 years. The state's Mexico City office is an important source of trade and investment leads.
Success Factors
Business can find what it needs to be successful in Texas, whose cities regularly appear on lists of the best places to start and do business. The trade climate is unabashedly pro-business. Texas has no personal income tax and is a right-to-work state.
 State Government
State government supports business growth through legislation. Texas municipalities are allowed to allocate one-half cent per dollar of their sales tax to economic development, which often translates into low-interest loans or new infrastructure for expanding companies. To date, more than 470 communities take advantage of this special incentive for economic development, which is expected to generate a total of $300 million a year.
As Texas Governor, George W. Bush led the successful fight for tort reform to improve the state's Workers Compensation program and make other improvements in the overall business climate. Most recently, the legislature approved a law that provides relief from school property taxes for large capital investment projects.
 Transportation
Texas is home to the nation's largest highway system, including eight interstate highways that carry goods to and from the U.S.Mexico border and connect with the nation's major population centers. The state's highway system and growing international and domestic trade have contributed to the strength of the transportation industry, with warehousing and distribution facilities throughout the state easily reached by truck and rail. Forty-four railroads transport Texas freight, much of which is destined for export.
Most of the state is in the Central Time zone, making business easy to conduct nationally and internationally. Texas' 27 commercial airports make air transportation and business travel easy from anywhere in the state. D/FW International Airport, one of the world's busiest, and George Bush Intercontinental in Houston connect Texas cities with world capitals.
The Port of Houston, one of America's most active, is the largest of the state's 13 deep-water ports along the Gulf Coast. The Gulf Intracoastal Waterway, which connects the Texas coast with the nation's inland waterway system, extends from the coastline near Brownsville, Texas to the Florida panhandle.The Port of Houston, one of America's most active, is the largest of the state's 13 deep-water ports along the Gulf Coast. The Gulf Intracoastal Waterway, which connects the Texas coast with the nation's inland waterway system, extends from the coastline near Brownsville, Texas to the Florida panhandle.
Workforce
More than nine million people work in Texas, the nation's second-largest workforce. Faster-than-average population growth in the state assures an available workforce for years to come. Fort Hood—the army's largest base, located in central Texas near Killeen—and the state's 21 other military bases are also a continuing source of technically skilled, disciplined workers. The face of the Texas workforce is more diverse than that of the nation as a whole, putting Texas at the forefront of a growing trend.
The Texas workforce is also one of the nation's most productive. Depending on the measure used, Texas workers are at least 15 percent more productive than the national average. Productivity rates in select industries, including the chemical, industrial machinery, and electronics sectors, are particularly high in Texas. If the good news about the workforce is high productivity, the better news for business is that the typical manufacturing production wage in the state is 12 percent below the national average.
The state's Skills Development workforce training program coordinates employers' needs with the state's network of 50 community colleges and four technical colleges to customize training.
Energy and Telecommunications
Energy is plentiful, reliable, and inexpensive. More than 27 new power plants were built within the past decade, another 27 are under construction, and more are on the drawing board. The U.S. Energy Information Administration ranks Texas 47th in total energy prices, 21 percent below the national average, and 49th in petroleum and natural gas prices.
On January 1, 2002, Texans became free to choose their electricity provider, as deregulation introduced retail competition among electric utilities. This deregulated environment is expected to reduce electricity prices while maintaining reliable service. As the state's largest electricity provider, TXU is at the forefront of providing innovative services and competitive prices to consumers and businesses. TXU once again ranked as one of "America's Most Admired Companies" within the Electric and Gas Utilities category according to FORTUNE magazine's 2002 list.
The state's major metro areas offer the most advanced telecommunications technology, and Austin regularly ranks near the top on national "most wired cities" listings.
Real Estate Costs
Most of the state's major cities offer business real estate at least 15-20 percent below costs of comparable properties in other major urban centers. Housing costs in most Texas markets are below national averages.
Strong Partnerships
Because of the state's size and vast resources available for business, strong partnerships exist to connect resources with businesses and communities. Texas Economic Development is a leader in developing these linkages. Says TxED's Jeff Moseley, "Texas Economic Development works with companies to help them find the Texas community that is right for them and then offers marketing opportunities that help them to market their products and services in a global marketplace. Texas is, and always will be, a great place to do business."
International Infrastructure
Houston is home to one of the nation's largest consular corps, with 70 consular offices located in the Bayou City. Texas has 29 foreign trade zones, more than any other state, to aid manufacturers engaged in international commerce.
Quality of Life
Whether the arts, fine dining, recreation, shopping, or sports, the choices for leisure pursuits are as vast as the Texas landscape. Choosing tee time at one of the state's 900 golf courses, watching 600 species of birds on the Coastal Bend Birding Trail, cheering for one of the state's eight professional sports teams, or enjoying the beach at Padre Island National Seashore are but a small sampling. The Dallas Museum of Art, Fort Worth's Kimbell Art Museum, and the Houston Grand Opera are among the state's leading arts venues.
To learn more about the advantages of a Texas location for your company, contact Texas Economic Development at 1-866-LOCAT-TX. More information about Texas is available at the agency's Web site, www.txed.state.tx.us/locateTX
A$3 billion, FORTUNE 1000 company, ACS delivers business process outsourcing (BPO) and information technology (IT) solutions to commercial and government clients worldwide. ACS was recently named to FORTUNE magazine's list of most admired companies in America as number three in the Computer and Data Services industry.
With more than 30,000 employees in 35 countries, ACS delivers processes, technologies, and industry-specific solutions to help companies run more efficiently and lower costs. As the leading provider of BPO services to state and local governments, ACS helps government serve citizens better. ACS' clients span a variety of industries including financial, government, healthcare, retail and transportation.
The only publicly traded company that has never missed earnings or lowered guidance since going public, ACS consistently delivers double-digit growth and demonstrates its long-term stability to clients, employees and stockholders. The company's stock trades on the NYSE under the symbol "ACS." Learn more at www.acs-inc.com
For more information about how to advertise in the next Economic Development section, please contact Laurie Evans, Manager, Custom Projects at laurie_evans@timeinc.com or call 212-522-1253.
Produced by: Tom Lewis, Robert Clark
Written by: Annette Argall
Photos by: 7th Street Studios Kenny Johnson/Rush Studio
Edited by: Gabe Kirchheimer
Designed by: by SJI Associates, Inc.
Reprints of this section are available in quantities of 100 or more; custom reprints can also be created. To obtain a reprint order form, please fax your request to Randi Bergman at 212-467-1695 or e-mail to randi_bergman@timeinc.com.
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