TEXAS — Chicago is messing with Texas.
World Business Chicago, the public-private operation that serves as the city’s economic development arm, said it took out a full-page ad in the Sunday Dallas Morning News, inviting corporations to head north for the warm business climate and stay for the more liberal abortion and voting laws — a swipe at restrictive legislation the Lone Star State passed on both fronts in recent months.
What You Need To Know
- World Business Chicago ran an ad in The Dallas Morning News that encouraged companies to leave Texas because of its recently enacted abortion and voting laws
- Texas is the fastest-growing state in the country in terms of jobs and residents
- Some experts believe policies like the abortion ban could encourage some companies to relocate out of Texas and discourage others from ever moving here
- Digital nomad culture allows workers and companies to become less tethered to a location, which might hurt Texas
The ad, too, offers anyone who disagrees with the Texas laws to make a fresh start in Chicago.
The ad quickly turned from a recruitment message to a political statement, offering “a few more” reasons to come to Chicago, including “Every person’s right to vote” and “Protecting reproductive rights” and “Science to fight COVID-19.”
Texas is in the throes of several political battles on abortion and voting rights that have divided the nation. The state’s new abortion law, signed by Republican Gov. Greg Abbott, prohibits abortions once medical professionals can detect cardiac activity, usually around six weeks, and before many women know they’re pregnant.
During the same session, Abbott signed an elections overhaul into law that adds more voting restrictions after Democrats spent months protesting what they say are efforts to weaken minority turnout and preserve the GOP’s eroding dominance.
And last month, Abbott banned government mandates on mask-wearing and vaccines as the delta variant of COVID-19 surges across the nation.
Dozens of businesses are going public with their opposition to the new Texas law that bans abortion after about six weeks of pregnancy, a move that follows weeks of debate inside companies about how to respond.
More than 50 companies signed a letter this week saying that Texas’ abortion ban threatens the health and economic stability of their workers and customers.
Companies, including Yelp, Lyft, VICE Media Group, Ben & Jerry’s and Reddit, said Texas’ abortion law goes against their company values.
“Restricting access to comprehensive reproductive care, including abortion, threatens the health, independence and economic stability of our employees and customers,” the companies said in their letter.
“Simply put, it goes against our values and is bad for business. It impairs our ability to build diverse and inclusive workforce pipelines, recruit top talent across the states, and protect the well-being of all the people who keep our businesses thriving day in and out.”
According to the coalition’s website, the companies that signed the letter represent more than 129,000 workers.
“The future of gender equality hangs in the balance, putting our families, communities, businesses and the economy at risk,” they added. “We stand against policies that hinder people’s health, independence and ability to fully succeed in the workplace.”
Gov. Abbott’s press secretary Renae Eze said in a statement: “The Texas economy is booming. People and businesses vote with their feet, and month after month they are choosing to move to Texas more than any other state in the country. Businesses are relocating to and investing in the Lone Star State at a record pace because we’ve built a framework that allows free enterprise to flourish and hardworking Texans to prosper.”
Did these new laws invite a brain drain for Texas?
Eze’s statement is backed up by numbers. Texas is booming by any metric.
The Governor’s Economic Development and Tourism office said in September there’s been a “tremendous increase” in companies reaching out since the pandemic hit, with 237 relocation or expansion projects currently in the works.
Oracle moved its headquarters to Austin, Texas, late last year. Tesla is also building its new Gigafactory there, and Apple will house its second-largest campus in Texas’ capital city. This Big Tech influx has raised chatter about Texas potentially becoming a business hub that could rival Silicon Valley.
CBRE and Charles Schwab relocated their headquarters from California to the Dallas area in recent months, and Hewlett Packard Enterprise is headed to Houston. Texas has also attracted wealthy individuals like Joe Rogan, Elon Musk, Dropbox CEO Drew Houston and Palantir co-founder Joe Lonsdale.
But it’s not just big businesses and the wealthy who are moving to Texas. In 2020, Texas added more residents than any other state. This comes as California’s population and job growth have slowed to a trickle.
This boom, some experts say, will soon be tested, as some companies’ social pledges appear to be diametrically opposed to the controversial new laws. Chicago’s aggressive pitch to companies may augur a brain drain, as companies and educated members of the workforce look for places to live and work that align with their values.
Trina Olson and Alfonso Wenker are the co-founders of Team Dynamics, a Minneapolis-based human resources company that helps businesses change their culture. The duo also penned “Hiring Revolution,” a book of recommendations on how companies can diversify their hiring pools.
Olson said that considerations such as a state’s reproductive laws and other sociopolitical factors can affect where companies are going to locate.
“You will not be able to be competitive in a modern workforce if you are not setting people and families up for success,” she said.
Pay discrepancy between genders, the lack of upward mobility for people of color — especially women of color — and lack of access to healthcare services like abortions all contribute to shrinking the hiring pool.
“There is this sort of cascade of impact across generations and communities when you’re not investing in people from the beginning,” Olson continued.
Data suggest that diverse companies are more successful, as companies are better able to leverage the perspective of people across lines of race and gender.
“We’re seeing all the data come out that women have left the workforce in a higher percentage than men for a whole bunch of reasons,” Wenker said. “What happens is the Texas abortion ban exacerbates the current conditions that keep telling women and trans workers ‘You’re less valuable, you’re less worthy or less important.’ At the same time, corporations are saying, ‘We value the leadership of women. We want to diversify our talent pool. We believe everybody should be accessible.’
“So policymakers, the current environment and the ways in which people hire and manage keeps sending mixed messages about who is valued and who deserves to be hired, paid well and promoted,” he continued. “I think the brain drain follows other movements that we’ve seen.”
Another factor that doesn’t bode well for Texas’ future is the recent proliferation of digital nomad culture — people who aren’t tethered to a location in order to do their jobs.
“COVID just accelerated people’s understanding that work-from-anywhere is really a possibility when you have a digital job,”Wenker said. “So why on earth would you invest in a location that hurts your workers?”