• Thu. Nov 24th, 2022

Texas executives aren’t firing but worry about employee retention

ByRobin H. Purcell

Nov 24, 2022

Inflation and its economic impact were a major factor in the midterm elections, according to polls, but according to a recent poll, it looks like Texas has a bright economic future.

Digital consulting firm West Monroe surveyed 248 executives from Texas, California, Florida, New York and Illinois. In Texas, 51 executives came from industries including agriculture, healthcare, finance, real estate, retail, telecommunications and energy and represent billions of dollars in revenue.

The vast majority (73 percent) said they do not plan or will layoffs in the next six months, the best result of any state surveyed. While inflation and the supply chain are still seen as a major issue by respondents, 33 percent of them expect inflation to be resolved within 12 months, while 40 percent say the same about inflation.

In fact, Texas companies seem to be most concerned with industrial relations and employee retention. More than 40 percent of executives cited this as their top concern.

They probably have a good reason. For one thing, Gov. Greg Abbott’s hardline anti-immigrant policies are having a significant impact on employment. Tens of thousands of job vacancies remain unfilled thanks to Abbott’s draconian limit policies, something he’s already promising to increase after winning a third term. Companies’ inability to fill vacancies forces them to offer higher wages. While higher wages are a good thing in the long run, they have been a driving factor in Texas inflation rates.

Even in the high-income category, Texas employers are struggling against the effects of Republican policies. The state’s ban on abortion and promises to screen parents of trans children are slowing the brain drain to the state. As oil companies spend millions to lure workers into the state, more and more are saying no thanks. In recent polls, nearly half of women said they would not consider working in a state like Texas that bans reproductive choice. A third of the men also agreed.

For years, Texas has presented itself as a business-friendly state that offers low taxes and lax regulations. This has prompted a significant number of large companies to relocate to the state, including Tesla.

However, the reality is much muddled and workers are feeling the pinch. As a right-to-work state, workers in Texas have fewer protections, and there are no explicit laws on Texas books protecting minorities based on gender and sexual orientation. Also, it turns out that the low taxes generally only affect the wealthiest Texans. Despite the lack of a state income tax, middle-class Texans pay nearly a full percentage point more than Californians. Lower-class Texans pay 2.5 percent more than the same group in California.

So far it looks like most Texans won’t have to worry about losing their jobs in 2023, but companies are fighting for workers amid Republican culture wars. Leaders know they have a commitment problem.