By John Colyandro and Tom Aldred
Thirty years ago, falling oil prices precipitated a recession in Texas. As oil money ran dry, real estate values collapsed, and many banks closed. Unemployment spiked; one in ten Texans was out of work. The same thing is not true today. Between April 2014 and April of this year, the price of a barrel of West Texas Intermediate crude oil (WTI) sank from over $100 to less than $30. During that same period, however, the state’s unemployment rate fell, from 5.3 percent to just 4.4 percent.
What explains this difference? Today, the Texas economy is heavily diversified across a range of sectors, from the stalwart oil and gas sector to retail, health care, and even education. Texas has also developed a robust technology sector. According to data from the Dallas Fed, there were only 18,000 technology sector jobs in Texas in 1990. Today, that number stands at more than 160,000.
Central to helping make Texas a technology hub has been the attention paid to the state’s business climate by state leaders. Similarly, recent attention to attracting high quality academic researchers and bolstering the number of highly-ranked research universities in the state has helped underpin Texas’ technology sector growth.