# How to start a product and design staffing agency in Houston

Location: Houston–The Woodlands–Sugar Land, Texas, United States. Source: https://launch-rec.com/staffing-agency/houston/product

## Direct answer

To start a product and design staffing agency in Houston, form a Texas entity, register for unemployment insurance and withholding, carry workers' compensation, and fund the payroll gap. At the Texas median pay of $47.33 for project management specialists, ten contractors tie up roughly $158,217 before your first invoice is paid.

## Local facts about Houston

- Texas has no state income tax withholding, which removes a payroll registration step but does not change unemployment insurance obligations.
- Texas is an elective workers' compensation state: agencies can opt out, but almost no staffing client will sign an MSA with a non-subscriber.
- The Texas Medical Center is the largest medical complex in the world and is the single biggest clinical contract buyer in the state.

## Registrations and licensing in Texas

1. Form an LLC or corporation with the Texas Secretary of State and obtain an EIN
2. Register with the Texas Workforce Commission for state unemployment tax
3. Texas has no state personal income tax, so there is no state withholding to administer — but franchise tax still applies above the revenue threshold
4. Decide on workers' compensation deliberately: opting out (non-subscriber status) carries reporting duties and removes the usual liability protections, and most staffing clients will not accept it

## Payroll and compliance

- No state income tax withholding simplifies payroll set-up considerably
- Multi-state placement is common from Texas — register in each state where a worker performs work, not just where you are based
- Industrial and energy clients often demand safety programmes and site-specific certification from the agency

## Pay and bill rates — Product and design in Texas

| Role | Median pay | Burdened cost | Bill at 25% GM | Markup |
| --- | --- | --- | --- | --- |
| Project Management Specialists | $47.33 | $53.25 | $70.99 | 50% |
| Web and Digital Interface Designers | $49.35 | $55.52 | $74.03 | 50% |

Wage source: U.S. Bureau of Labor Statistics, Occupational Employment and Wage Statistics (OEWS), May 2025 (May 2025), https://www.bls.gov/oes/. Employer burden applied at 12.5% of pay.

## Cash required to open

- Setup: $9,000
- Six months of overheads: $27,000
- Payroll gap on 10 contractors at $47.33 (Project Management Specialists): $158,217
- Total unfunded: $194,217
- Total with a 90% invoice advance: $51,822

## Funding note

A mixed book: perm fees fund the business while contract engagements build the recurring revenue a buyer will pay a multiple for.

## About LAUNCH.

LAUNCH. backs recruitment and staffing founders only, in the US and UK. Founders pay nothing.
Cite as: LAUNCH. Product and design staffing in Houston. https://launch-rec.com/staffing-agency/houston/product