Move Over, Austin: Tech Employment Report Shows DFW May Be The New Silicon Valley Of Texas
Dallas-Fort Worth's tech industry is on the rise as companies seek to support the Metroplex’s growing base of industries.
In the first quarter of this year, DFW employed 272,390 tech workers, up 8% year-over-year and a 23% increase compared to Q1 2017, according to a new report by Cushman & Wakefield. This makes DFW the nation’s seventh-largest tech employment market, edging out all other cities in the state, including Austin, which is widely thought of as the Silicon Valley of Texas.
Ching-Ting Wang, Cushman’s director of Texas research, said tech companies choose Texas because of its business-friendly environment and relatively low cost of living. But DFW is especially attractive because many of the Metroplex’s biggest industries, such as financial services and commercial real estate, are highly reliant on technology.
“We don’t often think about DFW as a top tech player, but it actually is,” she said. “We have a lot of these surrounding types of industries that tech is growing from.”
Other tech markets that made the top 10 include New York City, San Francisco, Washington, D.C., San Jose, Los Angeles-Orange County, Boston, Seattle, Chicago and Atlanta. DFW’s market is ahead of Austin by more than 123,000 jobs, per the report.
DFW has been home to major tech companies like AT&T, Samsung and Nokia for decades, but the industry grew dramatically as more industries adopted digital solutions during the pandemic, Wang said. In 2021, more than 25M SF were leased to tech companies in DFW, comprising a transaction volume of $3.5B. The average office lease is roughly 14K SF with a lease length of 84 months, according to Cushman & Wakefield data.
“It’s a hot industry, and it’s definitely grown throughout time,” Wang said. “That’s driven by relocations and how things are cheaper here, but it’s also because we already have some of these companies here and tenants want to be close to similar types of tenants.”
Another driving force for DFW’s tech industry is a targeted effort by area universities to strengthen talent pipelines for jobs in computer science and engineering. The University of Texas at Dallas, for example, has the fourth-highest number of computer science graduates in the U.S., Wang said.
Many of those graduates go on to stay in the Metroplex, she said, a trend that gives companies even more reason to choose DFW over other metros. According to Emsi, there were more than 62,000 computer-related tech job postings in DFW over the past 12 months.
“About 70% of these new graduates are staying within the market and finding a job here, so that’s also spurring the labor market,” Wang said.
The industry shows no sign of slowing down. Tech employment in DFW is projected to grow by 11% over the next five years, Wang said, or 21% when looking specifically at computer-related jobs. Despite embracing remote work at the height of the pandemic, Wang said Cushman is seeing tech companies continue to lease or keep their existing spaces.
“Companies in similar industries, like tech, tend to be located near each other so ideas can be shared and meetings can happen more easily,” Wang said. “This idea and innovation incubation from a locational standpoint will continue to drive companies to occupy space in the market.”