Economy of Texas

Texas has the second-largest state economy in the US, with a GDP exceeding $2 trillion. If Texas were an independent country, its economy would rank roughly 8th or 9th in the world — ahead of Canada, South Korea, and Russia.

Energy has defined Texas economically for over a century. Texas is the top oil-producing state in the US, accounting for about 43% of total US oil production. The Permian Basin in West Texas is one of the most productive oil fields on Earth. The Eagle Ford Shale in South Texas is another major production zone. Texas also leads the nation in wind energy production — the state generates more wind power than the next four states combined.

Technology has become a major pillar of the Texas economy, particularly in Austin. Dell Technologies was founded in Austin, and major tech companies including Apple, Tesla, Oracle, and Google have established significant Texas operations. Austin's tech sector has made it one of the fastest-growing major metro areas in the country.

Aerospace and Defense are critical in Dallas-Fort Worth (home to Lockheed Martin, Bell Helicopter, and numerous defense contractors) and Houston (home to NASA's Johnson Space Center and a growing commercial space sector anchored by SpaceX's operations at Boca Chica).

Healthcare and Life Sciences are concentrated in the Texas Medical Center in Houston — the largest medical complex in the world, with over 60 institutions, 106,000 employees, and more than 10 million patient visits per year.

Agriculture — Texas leads the nation in cattle production, ranking first in beef cattle, sheep, goats, and cotton. The state's agricultural output exceeds $25 billion annually.

Trade — Texas has the busiest cargo border crossing in the US at Laredo, where hundreds of billions of dollars in goods flow between the US and Mexico annually. The Port of Houston is one of the busiest in the country by cargo volume.

Texas has no state income tax, which alongside its warm climate, lower cost of living (outside major metros), and business-friendly regulatory environment has driven substantial corporate and population migration from higher-cost states.