Some of society’s most pressing problems surround the incidence, severity, and consequences of various diseases and conditions. Life sciences industries strive to achieve a healthier population through research, development, and manufacturing of pharmaceuticals, biotechnology-based medicines, devices, biomedical technology, and other advances dedicated to improving our wellbeing and, indeed, preserving our lives.
Since 2020, life sciences have experienced significant growth in Texas, expanding from employment of less than 52,300 in January 2020 to more than 67,800 in March 2023 (the latest available data at a granular level). The increase has been concentrated in the scientific research and development sector, which rose from approximately 24,400 employees in January 2020 to 38,600 in March 2023. The overall pace of life sciences net job creation in Texas over the past decade has been almost three times the national average and far above all major competitive states.
Texas was recently selected as site of the Customer Experience Hub for a substantial new federal initiative, the Advanced Research Projects Agency for Health (ARPA-H). Major new life sciences developments in the state (including Pegasus Park in Dallas, which will be hub of ARPA-H activity) are serving as catalysts for further growth.
These industries are characterized by high value-added components; thus, they generate significant economic benefits. We recently examined the current and potential future effects of the primary industry groups related to life sciences.
We estimate life sciences currently contribute $41.4 billion in gross product and about 319,150 jobs in Texas (including multiplier effects). By 2050, the economic benefits of the industry are projected to rise to almost $75.7 billion in gross product and 582,700 jobs under baseline conditions. However, if Texas could achieve a concentration of these industries equal to that of the U.S. by 2050, the gains escalate to some $154.5 billion in annual gross product and nearly 1.2 million jobs. If the state were to perform as well as the traditional epicenters for the industry (California and Massachusetts), the expansion would be much higher.
Business activity generates tax receipts which are used to fund state and local priorities. We estimate that operations of firms in life sciences currently generate about $1.7 billion in tax receipts each year to local taxing entities across Texas, with $1.9 billion per year to the State. As these industries grow, their fiscal contributions will escalate.
Unlike most other high growth sectors, Texas is a latecomer as a major player in biosciences and lags behind most major competing states. The recent ascent has been meteoric, however, and is rapidly moving the state to the fore. The result will be both a notable stimulus to prosperity and, more importantly, critical enhancements in health that will positively impact people across the globe. Stay safe!
