Austin is a hot spot for new businesses
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Austin had the highest rate of new business applications among major Texas metros in 2022, per new Census Bureau and IRS data.
- Some 19 new business applications per 1,000 residents were filed in the Austin-Round Rock metro area — ranking the city 21st nationally.
Why it matters: New business applications are an important measure of an area's perceived economic health. If lots of people are trying to start new companies in a given city, it's a sign that they're bullish on the area's prospects.
Be smart: The Austin metro rate is higher than the national average of 15 applications per 1,000. It also dropped from 2021 by just 1% compared to the 6.6% drop seen nationally.
What they're saying: Austin's regional economy has grown twice as fast as San Antonio and Dallas in the last decade — and three times faster than Atlanta, Columbus and Orlando, officials with economic development initiative Opportunity Austin tell Axios.
- The city has worked to diversify its economy following the dot-com recession in the early 2000s into other industries like aerospace, defense, electric vehicles and life sciences, they added.
- That evolution helped the region weather the 2008 and 2020 recessions.
Meanwhile, Dallas and Houston are also seeing higher-than-average application rates.
- Some rural west Texas counties are also seeing high rates per 1,000 residents, including Loving, Glasscock and Borden.
Between the lines: The word "startup" tends to evoke buzzy Silicon Valley tech ventures. But young companies of all stripes, from stores and restaurants to software and manufacturing firms, play a big economic role.
- As of 2021, more than 66.7 million Americans worked for companies with fewer than 100 employees, and those companies posted nearly $3.6 trillion in annual payroll, per census data.
The big picture: Just over 5 million new business applications were filed nationwide in 2022, or 15.1 for every 1,000 residents.
- That's down from 2021, when nearly 5.4 million applications were filed nationwide, or 16.2 for every 1,000 residents.
Zoom out: The Southeastern U.S. is a hotbed of new business activity, home to nine of the top 10 major metro areas with the most new business applications per 1,000 residents last year.
- Miami/Fort Lauderdale/West Palm Beach (40.9) took the top spot for major metro areas.
Reality check: A filed application is no guarantee of a healthy, thriving business to follow — but at the very least it's a sign of economic optimism.
Editor's note: This story has been updated to include comment from Opportunity Austin.