DALLAS — Like millions of others, my spouse and I moved to Dallas for a job – her job – and remained to build a life, family and career.
Four decades later, we’ve relocated to a retirement community in Georgetown, where we hope to have the time and space to write a new chapter, at a more leisurely pace.
I’ve been reporting on North Texas business since 1985, including 22 years as a business columnist, the last 10 at The Dallas Morning News – and now I’m leaving daily journalism. It’s been a great run for me and my family, and it’s been a pivotal time for business in Dallas-Fort Worth and Texas.
By many measures, the region and state have gone from rising stars to the epicenter of the new American economy.
As a journalist, I chronicled the evolution. As a resident, I benefited from it.
In my early years here, the state had a rallying cry that became a self-fulfilling prophecy: “The business of Texas is business.”
The state continues to fall short on many fronts, especially in public education, poverty and health care. Why is there no shame in always leading the nation in the uninsured?
Such failures are made more disappointing because the state is so rich in resources. We should all demand more, a lot more.
But as I reflect on the past, it’s the progress that stands out, not the shortcomings. Here’s my look back at some of the business trends that transformed the region – and continue to make Dallas a favorite for the next generation of newcomers.
The great jobs machine keeps on crankin’
At its core, Texas is a growth story.
It benefits from being in the Sunbelt, a top destination for snowbirds for several generations, and from having an extraordinary amount of natural resources, including energy, land and water.
The region and state have often been leaders in job growth, population gains and net migration from other states, notably California, New York and Illinois. In D-FW, the rate of job growth has consistently doubled the nation’s, and the gap widened during the pandemic.
In 1990, D-FW cracked the top 10 most populous metro areas with over 3.9 million residents, and a local chamber of commerce reworked its marketing materials to tout the breakthrough. Today, Dallas-Fort Worth ranks No. 4 among U.S. metros with over 7.7 million people – and it’s on pace to pass No. 3 Chicago in the next decade or so.
There was a time when most of the new homes, offices and distribution centers didn’t reach far beyond the Interstate 635 loop. Construction now seems to stretch on and on, and the building crane again looks like the state bird.
“Years ago I used to say: ‘Why does Dallas keep growing? Well, one of the reasons is there’s nothing to stop it until you get to the Red River,’” said economist Bernard “Bud” Weinstein. “And damn, that’s what’s happening.”
Weinstein did his graduate work in New York City and came to Dallas in 1975, and soon wrote an article about what New York could learn from Texas. He lauded Texas for being a right-to-work state with a business-friendly climate, low taxes and pro-growth policies.
Texas later made major reforms in workers compensation and business law, and embraced a wide range of public-private partnerships. Privately financed toll roads, for example, enable the region to keep pace with its rapid growth.
In general, lawmakers have had business’ back. They won’t raise the minimum wage – and won’t let more expensive cities like Dallas raise it, either.
“There’s a dynamic here: Growth begets growth,” said Weinstein, who retired from Southern Methodist University in late 2020 and still lives in the region. “Nothing draws a crowd like a lot of people.”
Diversity makes Dallas stronger
The boom-bust cycles that once characterized Texas – in oil and gas, real estate and defense contracting – are rarer and less severe. In large part, that’s because the economy has diversified, often after state and local leaders pushed in that direction.
Today, the Dallas region has an usually high concentration of workers in professional and business services and financial activities. Those sectors, which include many well-educated knowledge workers, offer higher pay and better prospects against a downturn.
From 1990 to 2022, the share of local workers in professional and business services grew over 8 percentage points. The share in health care and financial activities also grew while retail trade and manufacturing lost ground.
One way D-FW managed to pull off such a transition: It imported lots of talent from other states and countries.
“We couldn’t be sustaining this type of growth premium if we didn’t have all this new immigration and migration,” said Pia Orrenius, a senior economist at the Federal Reserve Bank of Dallas.
Newcomers are especially important in filling skills gaps in the workforce. As a group, they’re much more likely than the native-born to have a bachelor’s or graduate degree. A higher share work in management, computers, engineering and science.
International migrants drove much of Texas’ growth until the Great Recession. Since 2006, the state has become more dependent on domestic migration, she said. And in the past decade, skilled workers from India have greatly boosted the high-tech expertise in North Texas.
From 2010 to 2021, D-FW posted nearly 32% growth in foreign-born residents, well over double the rate for the rest of the country.
“It’s just been a very welcoming, open place,” Orrenius said.
After NAFTA, Texas becomes a trading power
Texas has benefited from earlier efforts to open the country to more trade and immigration. Soon after I arrived in Dallas, Republicans and Democrats in Congress passed an immigration reform law that offered amnesty to undocumented immigrants. It also boosted border security and imposed sanctions on companies hiring undocumented workers.
That legislative progress stands in sharp contrast to the impasse over immigration in the past decade. But trade has continued to flourish, even in the face of some political opposition.
In the 1990s, the North American Free Trade Agreement, known as NAFTA, led to major investments on both sides of the Texas-Mexico border. Within a decade, Texas became the top exporting state and continues to grow its lead.
In 2002, Texas exports topped California’s by $3 billion. Last year, Texas exports were nearly $300 billion more than its top rival, No. 2 ranked California.
Texas leaders have managed to keep a lid on regulations that make it harder to do business or limit growth and development, Orrenius said. When government piles on more rules and limitations, economic growth starts to decline – “slowly and surely,” she said.
Texas has been able to diversify quickly, in part because it welcomes outsiders and their views.
As a young economist, Orrenius was invited to Austin to testify on the economic recovery in the early 2000s, and was offered a flight on Ross Perot Jr.’s private jet. Another time, she addressed Dallas leaders on a study that showed much of the poverty gap stemmed from residents not speaking English fluently. The city later beefed up language efforts.
“Where else does that happen?” Orrenius said. “People here are open to new ideas, and they want to make things better. That’s pretty cool.”
Texas oil patch booms again
Texas is easily the top producer of oil and gas, which may not be surprising – until one considers that experts have been warning about “peak oil” since before I arrived here. Indeed, it took 33 years for Texas producers to surpass the average daily crude output reached in 1981.
In the Texas oil patch, innovation seems to find a way. In the 2000s, producers refined a process called “fracking” to unlock huge stores of natural gas and crude oil, ushering in the shale revolution.
Last year, Texas firms produced a record volume of natural gas and over 5 million barrels of crude oil a day, up from less than 2 million in 2012. That 2022 output was generated by 24% fewer workers than a decade earlier, and the state had a record haul from oil and gas production taxes.
Texas also is the runaway leader in wind power, and is coming on strong in solar and batteries. Renewables may seem off-brand for oil-soaked Texas, but they add clean, low-cost energy to the portfolio – and their ascension was no accident.
In the early 2000s, as part of Texas’ move to deregulate electricity, state lawmakers twice set minimum investments for green energy. The industry quickly blew past them.
Betting on a competitive electric market was a gamble for the state, and there were disruptions, including many bankruptcies. Most troubling, the state’s electric grid faltered under a brutal winter storm in 2021, killing hundreds and exposing weaknesses in Texas’ light oversight.
Today, regulators and lawmakers are working to improve reliability, and some propose spending billions for new natural gas plants.
Regardless of how that plays out, Texas’ faith in competitive markets has paid off: Over the past 20 years, the state has grown electricity generation five times faster than the rest of the country – and consumer prices fell below the U.S. average in 2009 and remained there for over a decade.
Texas goes big on tax breaks
In 1997, Intel broke ground on a chipmaking plant in the Alliance corridor in Fort Worth. It later walked away from the project after reportedly investing about $70 million.
One reason: School taxes on the billion-dollar factory would have been sky-high, a consequence of Texas having no state income tax and relying on property taxes to fund much of the government.
In 2001, Boeing Co. announced plans to move its corporate headquarters to Dallas, Chicago or Denver, setting off a high-stakes competition that garnered national attention. After Boeing executives arrived in North Texas, local news helicopters tracked their visit across the region – and Boeing later selected Chicago.
The two public disappointments, involving blue-chip names, prompted lawmakers and local officials to become more aggressive about economic development.
Texas passed a law that enabled big projects to avoid school taxes, which helped attract chipmaking plants, wind power farms and other capital-intensive investments. Lawmakers also created the Texas Enterprise Fund so the governor could throw in cash grants to “close” important deals.
“We wanted to have some sort of centralized war chest to go after great projects,” said Mike Rosa, who worked on the Intel deal and is now senior vice president of economic development at the Dallas Regional Chamber.
Over the past 20 years, the enterprise fund has awarded $709 million in incentives – and attracted over $54 billion in capital investments, according to the governor’s office.
“We have some younger elected officials who don’t know the history; all they’ve known is Texas winning,” Rosa said. “But Texas had to build for this success years ago.”
‘Playing the long game’
Incentives were crucial to developing Sundance Square in Fort Worth and drawing residents with a break on rental rates. Similar tools were used to revive areas around downtown Dallas, turning it into a magnet for new residents and businesses.
Just 200 people lived in downtown Dallas in 1996, and over 14,500 were living there last year, according to Downtown Dallas Inc. Two special taxing districts that include downtown Dallas have led to a $6 billion gain in appraised values since 2005, the group said.
The good times aren’t limited to the biggest places. Rosa said 36 cities in North Texas have notched a win with a company announcing an expansion, investment or relocation. He reeled off a list of data centers, logistics bases and corporate offices, including Toyota in Plano and Goldman Sachs in downtown Dallas.
He also likes to tell people that since Boeing’s decision in 2001, D-FW has attracted the headquarters of 11 other Fortune 500 companies.
In 2017, Plano also landed Boeing Global Services, the central hub for 20,000 employees. And last year, Boeing said it would move its headquarters from Chicago to a Washington suburb.
“We talk about playing the long game,” Rosa said.
