- Austin’s economy grew a relatively robust 3.1% in 2019, making it the 12th fastest growing major metropolitan area economy.
- Professional and business services was the most significant driver of Austin’s GDP growth in 2019.
- Austin’s real per capita GDP barely improved in 2019, but the region’s 14.5% growth over the last 5 years, ranks 7th among the top 50 metros.
Austin’s economy grew 3.16% in 2019 according to new data on gross domestic product (GDP) by metro area and county released late last month by the U.S. Bureau of Economic Analysis (BEA). Growth for 2018, which was previously stated as 5.6% has been revised to 4.8%. The compound annual growth rate for 2014-2019 is 5.6%. These growth rates are real, inflation-adjusted, rates. GDP is the value of goods and services produced within a region less the value of goods and services used up in production.
Although reduced from 2018, economic growth in 2019 across U.S. metropolitan areas was widespread. Of 384 metros, 90% saw real gains, compared to 93% in 2018. Aggregate growth for all U.S. metros fell to 2.1% in 2019 after increasing by 3.1% in 2018.
Austin’s 3.1% gain in real GDP is the 12th highest rate of growth among the 50 largest metro economies. The other major Texas metros grew at rates below the 2.1% rate for all U.S. metros. Houston grew 1.9% and ranked 28th, San Antonio grew 1.8%, ranking 29th, and Dallas-Ft. Worth’s 1.7% growth ranks 31st.
For the metropolitan portion of the U.S. as a whole, and for Austin, 2009 is the recession low-point for real GDP and positive growth resumes in 2010. Over the last 5 years, real GDP is up 13.6% in the metropolitan portion of the U.S. In Austin, real GDP has grown 31.2% since 2014, making it the fourth fastest growing major economy—behind only San Jose, Raleigh, and Seattle. Dallas-Ft. Worth (up 18.0%), San Antonio (up 15.3%), and Houston (up 10.4%) rank as the 19th, 23rd, and 30th fastest growing large metros for 2014-2019.
Austin’s current dollar GDP totals $159 billion in 2019, making it the 26th largest U.S. metropolitan economy. On the basis of population in 2019, the Austin metro ranks 29th. At the time of last year’s release of this data, Austin’s GDP also ranked 26th.
While 90% of all metropolitan economies grew in real terms in 2019, 100% of the 50 largest metros grew. In aggregate, their growth was 2.1%, the same as the real gain for the entire metropolitan portion of the U.S. The 50 largest metros account for 71% of U.S. metropolitan area GDP.
Per Capita GDP
Austin’s real GDP on a per capita basis performed well relative to other large metros over 2014-2019, but near the bottom for 2018-2019. Austin ranks 44th with 0.2% real growth in per capita GDP in 2019, while the growth for all metros was 1.6%. Houston’s gain was 0.6% (ranking 40th), San Antonio’s was 0.3% (42nd), and Dallas-Ft. Worth’s was 0.1% (45th). Four large metros had negative growth in real per capita GDP in 2019.
Since 2014, real per capita GDP is up 14.5% in Austin, making it the seventh best performing large metro. Across all metros, 2014-2019 growth was 9.6%. Dallas-Ft. Worth’s and San Antonio’s increases are 7.4% and 5.2% respectively (ranking 31st and 43rd). In Houston, real per capita GDP is only 1.6% above what it was five years ago (ranking 49th). Gains in real GDP on a per capita basis reflect improvement in an area’s standard of living.
The pre-recession peak for real per capita GDP across all metros was 2007. For the metropolitan portion of the U.S., 2019 real per capita GDP surpasses 2007 by 9.7%. Of the 50 largest metros, eight still have real per capita GDP that is lower than what it was in 2007. Two large metros—Las Vegas and New Orleans—have real per capita GDP in 2019 that is more than 10% below the level of 2007. In San Jose, real per capita income exceeds 2007 by 84.0% and the next greatest gain is 38.5% in San Francisco. Austin’s real per capita income is up by 18.6% (ranking 8th).
GDP by Industry
All major private industry sectors contributed positively to U.S. metropolitan area real GDP growth of 2.1% in 2019. Professional and business services (0.60 percentage points), information (0.39), and education and health services (0.26) made the greatest contributions to growth of U.S. metros in aggregate. Natural resources only accounts for 1.3% of GDP for the metropolitan portion of the U.S., but it was the fastest growing industry sector in 2019, with 8.3% real growth. The largest sector, financial activities (21.7% of GDP), grew by 0.8%.
In Austin, where real GDP growth in 2019 was 3.1%, professional and business services contributed the most to growth (1.18 percentage points). Manufacturing (0.98) and information (0.32) were also notable. Financial activities contributed negatively (0.63) to growth.
Professional and business services is Austin’s largest industry sector, accounting for 17.0% of 2019 GDP. The industry saw 7.1% real growth in 2019. Manufacturing, with real growth of 8.2%, grew faster. Manufacturing accounts for 11.6% of Austin’s 2019 GDP. Austin’s second most significant industry, financial activities, accounted for 15.2% of total GDP, but GDP attributable to the industry fell by 3.9% in 2019.
The standouts in Austin for growth over the last five years are information (70.2%) and professional and business services (50.1%), followed by national resources (44.4%) and manufacturing (43.4%).
GDP by County
Among the Austin MSA’s five counties, Williamson County saw the fastest growth (6.0%) in real GDP in 2019. Not only did Williamson County have the fastest growth in the metro, it was the fastest growing among all U.S. counties with 500,000 or more population. Each metro area county, except Williamson, saw lower growth in 2019 than 2018.
Manufacturing, particularly durable goods manufacturing, was the leading contributor to Williamson County’s growth in 2019, accounting for 3.09 percentage points. Wholesale trade (1.52) and professional and business services (1.31) were the next most significant contributors. Financial activities (-1.07) contributed negatively.
Travis County’s 2.8% real growth was driven by professional and business services (1.19 percentage points), manufacturing (0.58), and information (0.40), while financial activities contributed negatively (-0.51).
Refer to last year’s article about GDP data for an attempt to identify at what may be behind Caldwell County’s real GDP trend line.
- The BEA suppresses industry detail where publication has the potential to reveal information about individual or small numbers of businesses. Since the BEA introduced county-level GDP estimates last year, incidences of suppression for confidentiality have multiplied in metro level estimates. Data suppression of a few industries for the Austin MSA is due to suppression of these industries in the estimates for Bastrop County and/or Caldwell County. We made 2018 and/or 2019 estimates of missing county values for utilities, information, and parts of professional and business services and added these to the published industry estimates for Hays, Travis and Williamson County to create Austin MSA estimates where 2018 or 2019 data was suppressed. ↩
Related Categories: Central Texas Economy in Perspective