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(Andrea Guzmán/Austonia)
Could all the momentum the city has gained as a tech hub come to a halt with a possible economic slump?
Scott Francis, the board chair of the Austin Technology Council, has been in Austin since the 90s, so he’s seen the downturn in 2001 and then again in 2008 when he says Austin was affected quite a bit. But he thinks the scale of the investment in Austin is so much bigger now, making him less worried about it than he would have been 10 or 20 years ago.
The Chamber of Commerce has backed the idea that the diversity of the local economy would make a recession less destructive here. And at least for some tech giants in Austin, job security is less of a concern.
“When a company puts their headquarters in Austin, like Tesla has, then likely the ups and downs of their hiring and staffing changes are less likely to impact us negatively than they would be when their headquarters are somewhere else,” Francis said.
(Scott Francis)
Still, there might be specific pockets of trouble in the economy, Francis notes. He said passive client risk should be something tech companies keep an eye on. For example, there could be companies that aren’t in crypto but serve companies in crypto, and that could be a risk to their status amid the crypto crash.
Christa "CS" Freeland, founding executive director of the Austin Venture Association, told Austonia that in anticipation of a downturn they reached out to Austin’s venture community for their perspective on what we might expect here locally.
“The general consensus is that Austin will still continue to be a great place to start a family, enjoy the region with better work/life balance, and also get a house that would have been too expensive to even consider elsewhere in the Bay Area or NYC,” Freeland said.
(CS Freeland)
Austin's desirability to live here is an important asset that will help it weather the storm. It's a beautiful city with great food, tons of outdoor activities and no shortage of festivals.
“As long as we can make Austin an amazing place to live, there's going to be a great tech ecosystem in Austin, because techies are going to live here,” Francis said.
The growing number of tech workers with their high salaries has made it a place fewer people outside of the tech sphere can afford to live.
It's a different tune than in the past. Ultimately, Austin began competing with other tech hubs because of its relative affordability compared to other regions, Francis said. In the early 2000s and for some time after that, people had to be sold on Austin, feeling hesitant because they worried the market might be too small.
“That equation has changed so much. It's kind of amazing,” Francis said.
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