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How nationwide tech layoffs will impact Austin

While Austin's economy is healthy, experts say layoffs could impact expansion in Central Texas.

AUSTIN, Texas — Much of the fuel driving Austin's economic boom is the tech industry. That's why the recent string of layoffs seen nationwide are worrying some.

Google is one of those local tech giants. It's also one of the latest tech companies to cut thousands of jobs. Recently, Microsoft announced it is also slashing 10,000 jobs. Meanwhile, Amazon, Meta and Twitter have announced thousands of layoffs over the last few months. 

All five of these companies have ties to Central Texas.

"There's usually a gap between the time job cuts are announced and when they actually happen," said Ray Perryman with Perryman Group, an economic research company. "But we're just beginning to see some of those."

The Texas Workforce Commission said despite layoffs in the tech industry, the unemployment rate in Texas went down in December. Central Texas added 1,800 jobs over the last month.

"What's important to note is even during the course of a downturn of the economy, we're still working hard at creating jobs," said Roland Peña, Austin Chamber Global Technology and Innovation VP. "Recruiting companies, ensuring that there is programing around startups so that they can be successful, whether it be capital, block capital, or whether it be workforce, talent."

While Austin's economy is healthy, Perryman said these layoffs could impact growth moving forward.

"There'll be probably fewer expansions for a period of time here simply because the industry is going through some retrenchment in transition right now," he said. 

While the Austin area will face some challenges in 2023, the city's reputation and success in attracting startups and tech companies will serve as a cushion.

"So, for a long time, I think Austin has been here," Peña said. "What you've seen is, we have so much opportunity that people are continuing to migrate to Austin because of that. So, talent follows those jobs. And I believe we're going to continue doing the same."

Boomtown is KVUE's series covering the explosive growth in Central Texas. For more Boomtown stories, head to KVUE.com/Boomtown.

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