The Federal Reserve Bank of Dallas released the third edition of its “At the Heart of Texas” publication, providing economic profiles of Texas’ largest metropolitan areas. The report maps industry growth across 12 metros from 2016 to 2023 to explain Texas’ rapid rebound from the pandemic and also examines how the current artificial intelligence boom is driving data center expansion and investment in the state. Metro profiles highlight divergent growth drivers and constraints, including migration and expanding finance, insurance, transportation and e-commerce clusters in Dallas-Plano-Irving, and a slower post-pandemic rebound in Houston-Pasadena-The Woodlands tied to the energy sector’s protracted recovery. Other themes include San Antonio-New Braunfels’ diversification alongside skilled-labor constraints, El Paso’s cross-border linkages with activity slowing amid moderating US auto demand and tariff and trade uncertainty, and Austin–Round Rock–San Marcos’ growth driven by business relocations and technology and professional services. The edition also points to Midland-Odessa’s diversification efforts and emerging role as a data center hub supported by abundant energy resources and growing power sources, alongside challenges such as tight labor markets and outmigration in Amarillo and modest population declines in Beaumont-Port Arthur.

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