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Austin Ranks #1 for Small-Business Vitality

New York Times
"Why Austin, Tex. is a Good Place for Small Business"
May 12, 2011

In a post on the New York Times' "You're the Boss" small-business blog, advertising executive MP Mueller discussed Austin's economy and network, recently named number one for small-business vitality by the American City Business Journals. Seeking theories on Austin's success, he turned to finance professor and former dean George Gau (right):

Austin, according to Gau, is a hotbed in large part because of urban economics. He apologized for the “nerdy” explanation, but said it boiled down to primary employers like Samsung and the university, which support service businesses like restaurants, dry cleaners, law offices, real estate agencies, etc. Depending on the salaries paid to workers in the primary sector, each primary worker generates two or three service workers. “EBay recently announced they plan to hire 1,000 workers in Austin over the next 10 years,” he said. “That will translate into 2,000 to 3,000 service jobs being added here. All of the factors that cause large firms to relocate to Austin — business climate, skilled work force, beauty, weather, etc. — lead to the creation of more small businesses.”

The university also does its share of job creation, thanks in large part to the entrepreneurship resources found at McCombs such as Texas Venture Labs. To learn more and follow the progress of three student-based startups, read our OPEN magazine story, "The Next Big Thing."

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