In a nutshell: Texas is solidifying its position as a major tech hub, with Apple's recent announcement of a new 250,000-square-foot AI server production facility in Houston serving as the latest testament to the state's growing tech industry. This development is part of a broader trend of technology investments reshaping the Lone Star State's economy, often fueled by California-based companies seeking lower taxes and a more business-friendly regulatory environment. The influx of tech giants into Texas is reshaping the state's economic landscape. Apple already maintains its second-largest employee base outside Cupertino in Austin, while Samsung continues expanding its semiconductor operations in the state. Meta has relocated its trust and safety teams to Texas and other US locations, and companies like Realtor.com, Tesla, and Hewlett Packard have moved their headquarters there.John Diamond, an economist at Rice University in Houston, explains the appeal: "In the end, it's all about the cost of doing business, and the cost of doing business is just lower in Texas," he told the Wall Street Journal.The tech sector's growth in Texas has been remarkable. In the decade leading up to early 2024, high-tech jobs in the state grew at an average annual rate of 4.7 percent, outpacing overall job growth of 2.1 percent, according to the Federal Reserve Bank of Dallas. This influx of tech talent is transforming urban centers like Austin.Joseph Brusuelas, chief economist at consulting firm RSM, notes that dining in downtown Austin "is like being in Silicon Valley circa 2005" due to the concentration of young, educated tech workers.The tech boom isn't limited to large corporations. Startups like Graze Robotics are also finding Texas an attractive destination.Graze CEO Logan Fahey Franz cites several incentives for moving to Plano, including relocation support, tax rebates, and the city's openness to product testing in public spaces."Compared with California tech hot spots, 'it's gotten to the point where you can recruit, retain, and your cost is, I think we like to say, about 30 percent cheaper,' because of lower costs for labor and regulations," Franz said. // Related StoriesThe state is also introducing new tools and services to attract businesses, including a specialized business court for complex commercial litigation directly challenging Delaware's long-standing dominance in this area.Despite the overall positive trend, Texas faces some challenges. While tech job growth remains above the national average, its pace has recently slowed. Additionally, manufacturing activity declined in February, with some computer and electronics manufacturers expressing concerns about potential tariffs affecting customer demand.The state's restrictive abortion laws have also raised concerns among some companies considering relocation. However, David Yim, chief investment officer at USAA in San Antonio, suggests that business pragmatism often outweighs political considerations. "Politics certainly matters, and policy certainly matters. Pragmatism really for business and public companies is probably a bigger factor."