AUSTIN, Texas (AP) — Apple will build a $1 billion campus in Austin, break ground on smaller locations in Seattle, San Diego and Culver City, California, and over the next three years expand in Pittsburgh, New York and Colorado.
The tech giant said Thursday that the new campus in Austin, less than a mile from existing Apple facilities, will open with 5,000 positions in engineering, research and development, operations, finance, sales and customer support. The site, according to Apple, will have the capacity to eventually accommodate 15,000 employees.
The decision, announced Thursday, comes 11 months after Apple CEO Tim Cook disclosed plans to open a major office outside California on the heels of a massive tax break passed by Congress last year. That tax break prompted the company to bring about $250 billion in overseas profits back to the U.S.
The three other new locations will have more than 1,000 employees each.
Apple’s newest Austin campus will be 133-acres and is expected to make Apple the largest private employer in Austin.
“Apple is among the world’s most innovative companies and an avid creator of jobs in Texas and across the country,” said Texas Gov. Greg Abbott. “Their decision to expand operations in our state is a testament to the high-quality workforce and unmatched economic environment that Texas offers. I thank Apple for this tremendous investment in Texas, and I look forward to building upon our strong partnership to create an even brighter future for the Lone Star State.”
Jobs created at the new campus will include a broad range of functions including engineering, R&D, operations, finance, sales and customer support. At 6,200 people, Austin already represents the largest population of Apple employees outside Cupertino.
Early this year, Apple said that it would make more than $30 billion in capital expenditures in the U.S. over the next five years. That, the company said in January, would create more than 20,000 new jobs at existing and new campuses that Apple planned to build.
Where U.S. companies open new facilities or plants has always had the potential for public and political backlash.
That potential has intensified under the Trump administration, which has pushed companies to keep more of their operations inside the country’s borders.
While CEO Tim Cook has steered mostly clear President Donald Trump’s ire, Apple did receive some push back three months ago from the White House.
Apple sent a letter to the U.S. trade representative warning that the burgeoning trade war with China and rising tariffs could force higher prices for U.S. consumers.
Trump in a tweet told Apple to start making its products in the U.S., and not China.
Apple uses a lot of facilities overseas to produce components and its products, including China.
Top tech executives from Google, Microsoft, IBM, Oracle and Qualcomm gathered at the White House earlier this month to discuss strained ties between the administration and the industry, and trade tensions with China. Cook was not among them, nor was Amazon’s Jeff Bezos.
There are already 6,000 Apple employees in Austin, its largest operation outside of company headquarters in Cupertino, California, where 37,000 people are employed. The new campus will include 50 acres of preserved open space and, like all Apple facilities worldwide, its workspaces will be powered by 100 percent renewable energy, according to the company.
“Apple has been a vital part of the Austin community for a quarter century, and we are thrilled that they are deepening their investment in our people and the city we love,” said Austin Mayor Steve Adler in a prepared statement Thursday.
Apple said nearly a year ago that it would begin canvassing the U.S. for another campus.
Cities offered incentives to lure the company, but Cook avoided a high-profile competition that pitted them against one another as Amazon did over the last year and a half.
Amazon is receiving about $1.5 billion in incentives in New York and up to $750 million in Virginia. Apple will receive up to $25 million from a jobs creation fund in Texas in addition to property tax rebates that still need approval. The figure is expected to be a fraction of what Amazon received in New York and Virginia.
The new Austin campus will be about a mile from another large office that Apple opened five years ago. Apple currently employs about 6,200 workers in Austin, making it the company’s largest hub outside Silicon Valley even before the expansion.
The new Austin jobs are expected to mirror the same mix Apple already has at its existing campus, ranging from jobs in technology and research that pay well over $100,000 to lower-paying positions in customer call centers. Austin Chamber of Commerce Board Chairman Phil Wilson described jobs that Apple will be adding as “mid-skill” and “good-paying.”
Austin’s tech industries accounted for nearly 140,000 local jobs, or 14 percent of Austin’s total employment, about twice the national average, according to the city’s chamber of commerce.
“They are just picking America’s most established superstar cities and tech hubs,” said Richard Florida, an urban development expert at the University of Toronto.
“Austin has long been among one of America’s top knowledge and talent clusters so that’s not surprising,” Florida said. “And so is Boulder. The good news is places like Pittsburgh are starting to make real strides in becoming targets of these investments. But there aren’t a lot of other Pittsburghs in the heartland.”
The choices, he said, also illustrate the growing geographic inequality that “separates the thriving tech hubs from the more struggling and stagnating rest of the country.”
Amazon announced in November after a 14-month search it had selected Long Island City, Queens, and Arlington, Virginia, as the joint winners. Each site will employ around 25,000 people.
Cities are eager to bring in more tech employers because companies like Apple and Amazon ladle out six-figure salaries to engineers and other skilled workers.
The infusion of thousands of new and highly paid residents can ripple through an economy, with those employees filling restaurants, theaters, buying property and paying taxes.
Annual pay will vary at the new locations, but Apple workers in Cupertino have an average annual salary of about $125,000, according to a report the company submitted to the city.
