The economic miracle in Texas continues.

Since the recession began in December 2007, 1.2 million net jobs have been created in Texas. Only 700,000 net jobs have been created in the other 49 states combined.

The remarkable employment growth in Texas looks even bigger considering its size relative to the rest of the U.S. Total non-farm employment has grown by 11.5 percent in Texas since December 2007. Employment in the rest of the United States has grown only 0.6 percent. Until September 2014, total employment growth in the rest of the United States since December 2007 was still negative.



Only North Dakota has outpaced Texas on percent job growth, thanks to jobs created by the fracking revolution. California, Texas’ biggest economic rival, has created 985,600 fewer net jobs during the same period. California’s 1.5 percent job growth is ten percentage points lower than Texas’ percent job growth.

These data have been updated to include state employment numbers released Friday by the Bureau of Labor Statistics’ Current Employment Statistics data series.

Why is Texas such a great state for job creation?

For starters, Texas does not collect an individual income tax or a corporate income tax. It does collect a gross receipts tax. Still, the Tax Foundation’s 2015 State Business Tax Climate Index says Texas has the tenth best business tax climate in the U.S.

Texas has one of the highest sales taxes in the nation to make up for lost income tax revenue. The combined state and average local sales tax rate of 8.15 percent is 11th highest in the nation. However, sales taxes are more efficient than income taxes, since they don’t punish work.

Texas is also a right-to-work state, which studies have shown is better for the economy. Texas is the freest labor market in the country, according to the Mercatus Center. Their labor market freedom rankings include right-to-work status, in addition to minimum wage laws and workers compensation regulations, among other factors.

All these factors explain why Texas was ranked number one in economic performance in 2014 by the American Legislative Exchange Council. Texas performs highly in migration, employment and state gross domestic product.