It’s a well-known fact that Austin is one of the nation’s funkiest, fastest-growing cities. But how did a small, agrarian village become the thriving metropolitan center it is today? The city’s long history can provide some insight into its unusually rapid growth.
Before Colonization
As with every part of the United States, Native Americans were present long before the Austin area was colonized.
Austin has a rich history of Native American settlements. Tribes of Lipan Apaches and Comanches camped throughout the area that is now Austin. Towards the end of the 18th century, Spanish settlers arrived and established missionary settlements. They were followed by English colonists who, in the 1830s, established the village of Waterloo in modern-day Austin.
Waterloo Becomes Austin
In the year 1839, the city was incorporated as the Texas state capital and renamed Austin after a colonial settler named Stephen F. Austin.
By 1840, the town’s population had reached nearly 900 people (very large for a community at this point in America’s history). The early and ambitious blueprints for transforming the state capitol from a wilderness village into a grand metropolitan city included plans for the hilltop capitol building and Congress Avenue, an area that remains Austin’s bustling business district to this day.
Some Texans feared that Austin’s remote location left it at risk of Indian and Mexican invasion, so the Texas capital was moved to other cities between 1842 and 1845. This caused the city’s population to drop to less than 200 people during this period. In 1846, Austin was formally named the capital of the state of Texas after two state-wide elections on the issue.
Building Austin’s Landmarks
Throughout the following decades, Austin’s physical growth continued as it became a more established state capitol.
The first state capitol building was completed in 1853 (it would be replaced with the modern capitol building 35 years later) and the city was connected to the rest of the country with its first railroad in 1871, which also opened the doors for a growing immigrant population to move in. In 1881, Austin founded its University of Texas, which would later prove to invaluable to the city in one of its most trying times.
Austin and the Great Depression
Like all other American cities, Austin suffered during the 1930s and the Great Depression. But because the city was home to both the state capital and the University of Texas, it escaped some of the worst consequences of this unfortunate era.
For example, during the Depression, unemployment in Austin was higher than it had ever been—but it never sank as low as the national average. Crop prices and new construction initiatives dropped dramatically and many Austin citizens suffered homelessness, but the city’s leadership aggressively pursued financial assistance from the New Deal, infusing the local economy with projects like the development of the Mueller air base. Additionally, the revolving door of students (and their tuition checks) helped to keep the city operational.
Ultimately, Austin showed great resilience during one of the darkest decades in the country’s history. When one examines the history of Austin, the city actually emerges more polished, urban, and thriving after the Great Depression.
The Entrance of Tech
In the middle of the 20th century, Austin began to set the foundation for its future as a major technology hub. Multiple laboratories for research and think tanks were founded in the 40s and 50s. This drew well-educated talent and thriving companies—including IBM, Texas Instruments, and Motorola—into the city in the following decade.
This shift from a predominantly agrarian and political workforce to more tech and engineering professionals meant an influx of cash, which meant more fancy amenities that made Austin a desirable place to live. In 1947, the city celebrated the long-awaited re-establishment of Austin’s baseball team, then the Austin Pioneers. The fifties saw the construction of quality-of-life amenities like movie theaters, libraries, public pools.
Population Growth Patterns
Austin’s population has been steadily growing since its early days as the state capitol. According to aggregate data from the City of Austin and the US Census Bureau, the greatest jump in population was from 1985 to 1986, when the population grew from about 417,000 to more than 447,000 people. That’s an annualized growth rate of more than 7 percent!
The city had an even greater population boom of 8.1 percent between 1996 and 1997, but this was largely because of land annexation, not people moving to the city.
In 2016, Austin’s growth rate was 2.9 percent. That’s the greatest margin of growth the city has experienced since 2009, when the population jumped from about 750,500 people to nearly 775,000. The 2009 population boom was largely a result of the Great Recession—metropolitan areas experienced a trend of growth as the economy suffered.
Why People are Moving to Austin?
While Austin’s 2009 population boom was part of a larger national trend, the city’s more recent growth stands out as unique.
Between 2010 and 2016, the Austin metro area (which includes 5 counties: Bastrop, Caldwell, Hays, Williamson, and Travis) grew by almost 20 percent. While this number is impressive on its own, what’s truly shocking is the context: Austin’s growth margin was far greater than the growth margin for the country (about 5 percent) or the state of Texas (about 11 percent) in that same time period.
To really understand why people are moving to Austin, it’s important to examine several trends within this area since the end of the Great Recession.
Low Unemployment
Austin has one of the lowest unemployment rates in the state of Texas. In March of this year, the city’s unemployment was below 4 percent, in comparison to a state rate of 5 percent and a national rate of more than 4.5 percent.
And this impressive rate is not brand new—Austin unemployment has hovered around 2 or 3 percent since 2014, drawing job seekers to the region.
The Tech Scene
Another reason people are migrating to Austin is to start tech businesses. Large amounts of money are flowing into the Austin tech world, with large companies like Goldman Sachs pumping money into small, local startups through venture capital and equity funding.
Last year, Nerd Wallet voted Austin the number one best city for young entrepreneurs. Austin also topped Fortune Magazine’s “Top 25 Cities for Startup Activity” list.
Quality of Life
But not everyone is running to Austin in search of a job or venture capital—some transplants move there simply because it’s cool. Whether it’s the abundance of music music festivals, parks, or amazing restaurants that you choose to enjoy, Austin is a fun, pleasant place to live.
Continued Growth
In 2010, the Urban Institute released a report estimating that the minimum population growth rate for Austin between 2010 and 2030 would be 30.5 percent. That means, in less than 15 years, Austin would be home to nearly 2.5 million people. And that’s the most conservative estimate of population growth, according to the Institute.
Austin’s growth shows no signs of slowing down. This trend will present challenges but also a myriad of opportunities for the community in the coming years. One thing is certain: if you want to move to Austin, time is of the essence. More people means more competition for housing—so start your search now.