There are a lot of ways to measure how the economy is doing. But employment, or jobs, is probably the measure that means the most to us. On a macro level, we understand that it means something good when we read that two million new jobs were created and unemployment fell to 4.2%. On the micro level, it doesn’t require a Ph.D. to understand what it means when we look around and see our friends, neighbors, and even ourselves losing jobs.

So when we look at Texas today, it is easy to figure out why Texas is doing better than the rest of the national economy. It is because of jobs.

We created more jobs than the rest of the country combined in 2008, and kept creating a net increase in jobs much further into the recession than any other state.

To be sure, we’ve lost jobs this year and unemployment has increased, but we’ve still outpaced the national economy in keeping jobs and in creating new jobs to replace some of those that are lost.

Why is this? Why has Texas, alone among the 50 states, been a beacon of job creation?

We know it is not because of high taxes and government spending. The Associated Press reported last week that the administration’s report on jobs created by its economic recovery plan-how shall I put this-overstates the number of jobs actually created. And a new Harvard report finds that “fiscal stimuli based upon tax cuts are much more likely to be growth enhancing than those on the spending side.”

Maybe it is because we know that it is Texans, not the government, who create jobs. And because our level of taxes and regulations allow Texas entrepreneurs to go about their jobs of meeting consumer demand and in the process, create more jobs.

The Foundation’s Center for Economic Freedom held a policy primer last week to more closely examine the causes behind Texas’ economic success. It featured Tom Pauken, chairman of the Texas Workforce Commission; Ken Legler, state representative from Pasadena; Kurt Summers, owner of Austin Generator Service; and Andy Ellard, general manager of Manda Machine Co. in Dallas.

We spent some time looking at the big picture, but honed in on the role of the entrepreneur of in keeping the Texas economy going. 51% of Texas jobs and 48% of payroll expenditures are provided by employers with less than 500 employers. And most new jobs come from these smaller businesses. The panel pointed out that the entrepreneurs/owners of these businesses have a hard enough time providing jobs while meeting the demands of the market. When the government steps in to make life even harder, the jobs can disappear pretty quickly.

Here are some comments made after the event by Rep. Legler.

– Bill Peacock