Why do corporations love Austin so much?
From: Austin Business Journal
It isn’t just the tax incentives that draw a corporation to a city; it’s also the bike trails and bars.
Corporations’ top concern is drawing a strong labor force. And it takes the music scene and a place to kayak to attract the young professionals companies want.
“The number one factor is finding skilled workers, so quality of life is at the top of the considerations,” says Angelos Angelou, principal of economic development consulting firm Angelou Economics. His clients include Hewlett-Packard Co., Dell Computer Corp. and Advanced Micro Devices.
What matters is what workers think, Angelou says. “Today young professionals choose first where they want to live, and then they want to find a job.”
“On a scale of one to 10 (quality of life) is probably a seven or eight” in importance, says Bill Cryer, Samsung Austin Semiconductor LLC executive counsel for public affairs; he was involved in the decision-making process of bringing the new Samsung plant to Austin. Samsung, based in South Korea, has begun building the Parmer Lane plant, which is due to wrap up in the late spring or early summer of 2007. Including vendors, the plant will employ 900.
Obviously, Samsung is in the business of clean rooms and specialized equipment, something that Austin suppliers can provide, says Cryer. “You can’t build a semiconductor plant in the middle of Iowa,” he says. “You would have to bring everything in. Austin already has the infrastructure in place.”
But those clean rooms need technicians and engineers. “They tend to be outdoorsy or interested in the music scene,” Cryer says of the young engineers, a large number of whom are recent college graduates.
Here’s what Austin has to offer: from the Austin Parks and Recreation Department, 206 parks and 74 miles of hike-and-bike trails; from Casey Monahan at the Texas Music Office, 2,037 acts and 8,785 musicians; and from Cilla Temple at the Downtown Austin Alliance, 141 clubs and 351 restaurants in the west end of downtown.
Gary Farmer, president of Heritage Title Company of Austin and intimate with the push to get Samsung’s plant, says that good quality of life not only draws the educated workers, it keeps them.
Comparing December employment from 2000 to 2003, 31,000 jobs were lost in metro Austin. But there was a gain of 47,600 from December 2003 to 2005, according to Beverly Kerr, director of research at the Greater Austin Chamber of Commerce. It is believed that many of those unemployed stayed here, says Farmer.
And the numbers back that perception.
In metro Austin, there were 31,670 computer and mathematical professionals last year, an increase of 1.3 percent from 2001, before the dot-com bubble burst; 21,490 architects and engineers last year, unchanged from 2001; and 9,250 life, physical and social scientists – or research and development professionals – a 3 percent increase from 2001. These numbers come from the U.S. Bureau of Labor Statistics.
“I think that’s a really positive sign that Austin can retain its work force,” says Brian Kelsey, economic development coordinator for the Capital Area Council of Governments. “These numbers say that people who make up our human talent, these people are sticking around Austin.”
That’s critical to the future of technology-driven industries, says Dave Porter, senior vice president for economic development at the chamber. In the next 10 years, producing and keeping talent will be central to corporations’ choice in location.
And Austin is keeping its corporations.
Freescale Semiconductor, Inc., began attracting suitors in mid-2004, including Chicago and Dallas, in the push to get its headquarters at the advent of the break from Motorola. While the bulk of the company’s then-6,600 Austin jobs were not at risk, the prestige of keeping what would become a Fortune 500 company was, along with about 600 jobs.
There were concerns about limited access to international travel and other issues of accessibility. But The University of Texas at Austin, quality of life and other factors won out in Freescale’s final decision.
“The people I am trying to recruit for Freescale are more of what I call the more vibrant types. They are healthier, smarter … they care about what they do,” says Kurt Twining, senior vice president of human resources for Freescale. Twining says it’s easier for him to recruit because of the city’s lower crime rate, educational opportunities and reasonable housing. And there’s better access to what you want.
“It’s hard not to find what you’re looking for in this community,” he says.