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 Houston, the largest city in Texas | |
| Statistics | |
|---|---|
| GDP | $2.7 trillion (2024)[1] |
GDP per capita | $86,987 (2024) |
Population belowpoverty line | 14.0% (absolute)[2] 11.3% (relative)[3] |
| 0.4796[4] | |
Labor force | 15,226,787 (Apr. 2024)[5] |
| Unemployment | 4.0% (Apr. 2024)[5] |
| Public finances | |
| Revenues | $269.7 billion (2023)[6] |
| Expenses | $258.8 billion (2023)[6] |
Theeconomy of the State of Texas is the secondlargest by GDP in theUnited States afterthat of California. It has agross state product of $2.694 trillion as of 2023.[7] In 2022,Texas led the nation with the most companies in theFortune 500 with 53 in total.[8] As of 2023, Texas grossed more than $440 billion a year in exports, more than double the next highest stateCalifornia ($178 billion).[9]
Texas would be ranked as the 8th largest economy among nations of the world by nominal GDP, ahead ofCanada,South Korea,Russia, andAustralia.[10]
In 2019, Texas had a median household income of $61,874.[11] As of August 31, 2022 Texas had a total of $64.40 billion in state debt outstanding, including both general obligation and revenue debt.[12][13] Texas has thesecond largest population in the country after California.[14]
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Historically four major business enterprises shaped the Texas economy prior toWorld War II: cattle and bison, cotton, timber, and oil.[15] The first enterprise to enjoy major success in Texas was cattle and bison. In the early days of Anglo-American settlement, furs and hides were the major products derived from cattle. Beef was not particularly popular in the United States. However, Texas entrepreneurs soon pioneered the beef industry, and demand steadily increased. The cattle industry enjoyed its greatest financial success in the later 1870s and 1880s.
Cotton production, which had been known in Texas sinceSpanish times, gradually increased throughout the 19th century. By the early 20th century, Texas had become the leading cotton producer in the nation. By the 1920s, the cotton industry was past its peak, as government regulation and foreign competition took their toll.[16]
The forests of Texas have been an important resource since its earliest days and have played an important role in the state's history. The vast woodlands of the region, home to many varieties of wildlife when Europeans first arrived, provided major economic opportunities for early settlers. They today continue to play an important role economically and environmentally in the state.
The densest forest lands lie in the eastern part of the state. In particular theBig Thicket region, just north ofHouston andBeaumont, has historically been home to the most dense woodlands. The Big Thicket was mostly uninhabited until heavy settlement from the U.S. began in the mid-19th century, and was even used as a refuge by runaway slaves and other fugitives. TheRio Grande valley inSouth Texas was home to a large palm tree forest when Spaniards first arrived, though today very little of it remains.
The development of railroads in the eastern part of the state during the mid-19th century led to a boom in lumber production in the 1880s. This era of financial success lasted approximately 50 years finally coming to an end as Texas's forests were decimated and the Great Depression dropped prices.[17]
In 1901 the Gladys City Oil, Gas, and Manufacturing Company struck oil onSpindletop Hill inBeaumont. Though petroleum production was not new, this strike was by far the largest the world had ever seen. The find led to widespread exploration throughout Texas and neighboring states. By 1940 Texas was firmly established as the leading oil producer in the U.S.[18]
Texas remained largely rural untilWorld War II though the success of the petroleum industry rapidly expanded the economy with heavy industry of many types taking root. The second world war created tremendous demand for petroleum and a variety of products that Texas was in a unique position to provide. By the end of the war Texas was one of the leading industrial states and the population had become predominantly urban. Additionally the economy had diversified sufficiently that, though petroleum was still the largest sector by the end of the war, the business community in the state was truly diverse.
The economy of Texas relies largely on information technology, oil and natural gas, aerospace, defense, biomedical research, fuel processing, electric power,agriculture, and manufacturing.
Texas had led the United States in export revenues since 2001, grossing more than $440 billion in 2023.[9]
Largest export categories (2023):
Mexico is by far the largest export partner with Texas, receiving nearly $130 billion worth of goods in 2023. The next largest export partners are Canada ($36 billion) and Netherlands ($26 billion).
Air Cargo World ratedDallas/Fort Worth International Airport as "the best air cargo airport in the world".[20] ThePort of Houston is the largest port in the U.S. by tonnage, with more than 266 million tons of cargo passing through the port in 2021.[21]
According to theTax Foundation, Texans' state and local tax burdens are among the lowest in the nation, 7th lowest nationally, with state and local taxes costing $3,580 per capita, or 8.7% of resident incomes.[22] Texas is one of only 7 states not to have astate income tax.[22][23] The statesales tax rate, 6.25%, is above the national medium, with localities adding up to 2% (8.25% total).[24] Texas does have a "back to school" salestax holiday once a year (generally around the first weekend in August) on clothing and footwear under $100.[25]
As for Texas's business tax climate, the state ranks 8th in the nation.[22]Property taxes are exclusively collected at the local level in the state, and are generally at rates above the national average.[22] As a whole, Texas is a "tax donor state" with Texans receiving back approximately $0.94 per every dollar offederal income taxes collected in 2005.[22]
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Texas is one of the sevenstates of the United States with no personal state income tax. In addition, Texas does not allow any lower level of government (counties, cities, etc.) to impose an income tax. This means that, for the residents of Texas, the maximum rate of income taxation is the top rate set by thefederal government. Businesses, except forsole proprietorships andpartnerships, are subject to afranchise tax.[26]
The statesales tax is set at 6.25 percent.[27] Cities are allowed to impose an additional 1% tax, and additional taxes not to exceed 1% may be approved by voters for any combination of county sales tax, transportation districts, economic development, and/or crime prevention. The average sales tax in Texas amounts to 8.25 percent. The state determines the items subject to sales tax, which all other entities must follow. Motor vehicle sales are subject only to the 6.25% state sales tax. Food, except for prepared food, and non-prescription medicines are among the major items exempt from sales tax.[citation needed]
Whileproperty taxes are among the highest in the nation, property costs are also among the lowest in the nation. Property taxes constitute the majority of revenue and are collected and kept by local governments, as theTexas Constitution specifically prohibits a state property tax. For real property, counties, cities, and school districts (along with other special districts, such as for a community college or public hospital) can also impose taxes. All property is assessed uniformly throughout the county via the county "appraisal district", and taxes are assessed based on 100% of the property's assessed value. While largerpersonal property items such as cars, boats, and airplanes can be subject to local taxes as well, it is far less common.[citation needed]
Texas has the most farms in the United States both in terms of number and acreage.[28] Texas leads the nation in number of cattle, usually exceeding 16 million head.[citation needed]
Cultivation ofmung bean here began duringWorld War II when aChinese native by the name of Henry Huie – who worked as a U.S. Army cook – planted thestaple crop in theclay plains nearVernon.[29]
Texas leads nationally in production ofsheep andgoat products. Texas isking of cotton, leading the nation incotton production, its leading crop and second-most-valuable farm product.[30] Texas is a leader incereal crop production. Three counties in the state—Colorado,Wharton andMatagorda—take advantage of water from theLower Colorado River Authority to growrice and are responsible for about 5% of annual U.S. rice production.[31] Texas is also a large producer ofcantaloupes.[30]
TheRio Grande Valley is one of the best areas for the cultivation of grapefruit. Early varieties like theDuncan had many seeds and pale flesh, but in the 1880s citrus growers in Texas and Florida discovered pink-fleshed seedless grapefruit mutations like theRuby Red, which along with red-fleshed varieties like theRio Red andStar Ruby are preferred varieties for modern commercial production.[32]
Grapes are a commoncrop in some parts of Texas.[33][34] In the 1990sstrawberry acres had greatly increased especially aroundPoteet, however by 2004 imported strawberries had competed almost all strawberry production out of the state.[35]
Texas and Arkansas are among the higher producers ofspinach in North America and form the eastern limit of large scale commercial production.[36]: 3 Texas is the westernmost limit of commercialokra production. Texas is one of the largest producers ofonions. Texas is one of the major growers ofwatermelons.[36]: 5
Fire ants (Solenopsis invicta) are aninvasive agricultural pest here.[37]
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Lyndon B. Johnson Space Center, the center of theNational Aeronautics and Space Administration (NASA), is located in Houston. It is a leading hub for the Aeronautics industry. The National Space and Biomedical Research Institute is headquartered in Houston.
Dallas/Fort Worth International Airport, located nearly equidistant fromdowntownDallas and downtownFort Worth, is the largest airport in the state, the second-largest in the US, and the fourth-largest in the world.[38] The airport serves 135 domestic destinations and 40 international. DFW is the largest and mainhub forAmerican Airlines, one of the world's largest in terms of total passengers-miles transported and passenger fleet size.
Texas's second-largest air facility is Houston'sGeorge Bush Intercontinental Airport (IAH), the largest hub ofUnited Airlines. IAH offers service to the most Mexican destinations of any U.S. airport. IAH is currently ranked second among all U.S. airports with scheduled non-stop domestic and international service.
Headquartered in Fort Worth,American Airlines is the world's largest airline by passenger miles, passengers carried, and revenue.Southwest Airlines, also a leader in the commercial passenger market, is based nearLove Field airport in Dallas.Lockheed Martin Aeronautics, the aviation division ofLockheed Martin, is also headquartered in Fort Worth, and the company'sMissiles and Fire Control division is based in nearbyGrand Prairie, along with the American division ofAirbus Helicopters,Airbus Helicopters, Inc.Bell Helicopter is headquartered in Fort Worth as well.
Texas is home to two of theUnited States Army's largest facilities (in terms of geographic size),Fort Cavazos in Central Texas near Killeen andFort Bliss near El Paso. In addition,Fort Sam Houston in San Antonio is home to theBrooke Army Medical Center, one of the Army's major hospitals and its only burn facility, and theCorpus Christi Army Depot inCorpus Christi, Texas is home to the world's largest helicopter repair and maintenance facility.
TheUnited States Air Force operates several bases in the state –Sheppard (Wichita Falls);Dyess (Abilene);Goodfellow (San Angelo);Laughlin (Del Rio);Lackland andRandolph (San Antonio); andEllington Airport (Houston).
TheUnited States Navy operatesNaval Air Station Joint Reserve Base Fort Worth (the former Carswell Air Force Base facility) as well asNAS Corpus Christi andNAS Kingsville.
Texas (specifically Dallas and Houston) has a large number of defense contractors that create sizable employment for the state.
Two divisions ofLockheed Martin have their divisional headquarters in the DFW area –Lockheed Martin Aeronautics inFort Worth (where theF-16 Fighting Falcon, the largest Western fighter program,[39] is manufactured, as well as its successor, theF-35 Lightning II and theF-22 Raptor) andLockheed Martin Missiles and Fire Control inGrand Prairie.
Fort Worth is also the home ofBell Helicopter Textron, which manufactures several helicopters for the military, including theV-22 and theH-1, on which final assembly is performed inAmarillo. Furthermore, three major defense service contractors (DynCorp,AECOM, andDXC Technology) have substantial operations in Fort Worth.
Other major defense contractors with DFW presence includeBoeing (Richardson),Rockwell Collins (Richardson),Vought Corporation (headquarters in Dallas; facilities in Dallas and Grand Prairie),Raytheon (plants in Garland, Dallas, and McKinney),L-3 Communications (plants in Arlington, Carrollton, and Greenville; also has a facility in Waco),BAE Systems (facility in Fort Worth),Leonardo DRS (Dallas),Hewlett Packard Enterprise andNTT Data (Plano),Alliant Techsystems (facility in Fort Worth), andElbit Systems (facility and US headquarters in Fort Worth). TheDefense Contract Audit Agency maintains its Central Region office in Irving.
Outside the DFW area,KBR (the formerHalliburton subsidiary) maintains its headquarters in Houston, while theSouthwest Research Institute is located in San Antonio. BAE Systems also manufactures theFamily of Medium Tactical Vehicles at its facility inSealy, Texas.
Texas is one of the major hubs in the U.S. for development of computer components, systems, software and information infrastructure. Austin, Dallas, and Houston are the major centers for this industry in Texas. The Austin area is often nicknamed "Silicon Hills" because of the concentration ofsemiconductor design companies includingAMD,Cirrus Logic,Freescale Semiconductor,Intel andSilicon Labs.Dell's headquarters is located in the city's suburb,Round Rock, and major offices for Google, Facebook, EA Games, and Apple are also open in the Austin area. Austin is also the home of theTexas Advanced Computing Center at TheUniversity of Texas at Austin. Dallas is the birthplace of theintegrated circuit.[citation needed]
The North Dallas area is called the "Telecom Corridor" or the "Silicon Prairie"[citation needed] for the area's high concentration ofinformation technology companies such asTexas Instruments,Perot Systems, andEDS, as well as telecommunications giant AT&T. San Antonio is the home of cloud computing giantRackspace, as well as computing pioneerDatapoint.Harris County-basedCompaq,[40] was once one of the world's largest computer companies.[citation needed] After Compaq's merger withHewlett-Packard, the new owner currently employs more employees in the Houston area than anywhere else in the world.[citation needed]
Energy is a major component of the state economy. Texans consume the most energy in the nation both in per capita and as a whole.[41] The state is also the nation's largest energy producer, producing twice as much energy asFlorida, the state with the second-highest production. It is also the national leader inwind power generation, comprising about 28% of national wind powered electrical production in 2019. Wind power surpassed nuclear power production in the state in 2014.[42]
Texas has a large tourism industry. The state tourism slogan is "Texas: It's like a whole other country." Tourists might enjoySan Antonio andEl Paso's Hispanic culture, orFort Worth western attractions.Galveston,Corpus Christi, andPadre Island are some of the popular Texas resort areas located on theGulf of Mexico. Houston is Texas's leading convention city along with itsSouthern culture. Dallas is also one of the nation's leading convention cities as well as San Antonio. Professional and college sports are dominant in both Dallas and Houston.
Texas is a top filmmaking state.Austin is now one of the leading filmmaking locations in the country. The exteriors for the popular soap operaDallas were filmed onSouthfork Ranch, a location atParker, Texas. From 1995 to 2004, more than $2.75 billion was spent in Texas for film and television production.
TheTexas Film Commission was founded for free services to filmmakers, from location research to traveling.[43] Also manyHollywood studios are relocating parts of their production divisions to the Austin, Houston, and Dallas areas.[43]
The media conglomerateiHeartMedia is based in San Antonio, Texas. Video game developersRobot Entertainment,Gearbox Software, and3D Realms are based in the Dallas Fort Worth area, whileRetro Studios,Armature Studio, andGhostfire Games are based in Austin.Cinemark Theatres which is one of the largest movie theater chains is also based in the Dallas Fort Worth area.
Healthcare is a growing industry in the state of Texas. TheTexas Medical Center, located in south central Houston, is the largest medical center in the world.[44][45] It is home toUniversity of Texas Health Science Center at Houston which trains medical students and residents and includesThe University of Texas M.D. Anderson Cancer Center, a global leader of cancer research and treatment.[46] The medical complex also hosts a private medical college, TheBaylor College of Medicine.[47]
TheUniversity of Texas medical system[48] has additional branches in Dallas, San Antonio, Tyler, and Galveston. TheSouth Texas Medical Center in San Antonio with nearly 27,000 employees[49] has a $14.3 billion economic impact on the state of Texas.[50] In addition to these facilities, theTexas College of Osteopathic Medicine, theTexas A&M Health Science Center,[citation needed], andTexas Tech University Health Sciences Center in Lubbock and El Paso provide the state with a total of nine centers of medical research.
The following list contains per capita incomes of the 32 wealthiest locations in Texas:
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