Austin’s Reign as a Tech Hub Might Be Coming to an End

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Nearly five years after Austin, Texas, became a darling of the tech industry, luring companies out of California with the promise of lower taxes and a better quality of life, the city is now bleeding tech talent that is flowing back to the coasts.

A new report from venture-capital firm SignalFire shows that in 2024 Big Tech employment declined 1.6% in Austin, and startup employment fell 4.9%. Tech employment in Dallas and Houston also declined, along with cities like Denver and Toronto. Tech employment grew, on the other hand, in New York and San Francisco.

Return-to-office requirements combined with the burgeoning artificial-intelligence industry centralizing in Silicon Valley drew workers back West, while Austin’s fluctuating living costs and outdated infrastructure left new transplants frustrated, Bantock said.

Thom Singer, chief executive of the nonprofit organization Austin Technology Council, said Austin remains a compelling tech city and believes its best days lie ahead. The city is improving infrastructure and fluctuating costs of living are stabilizing, he said. While the scale of opportunities and the AI hub in San Francisco can’t be denied, Austin has a unique sell, and it isn’t trying to compete with the coasts, he said.

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