Well it's not like this is all a recent development. The Bay Area has been more expensive than Texas for about 150 years now, and yet SV is the big time, while Austin is a regional hub. "Land is cheaper! Employees will settle for less money!" is true pretty much everywhere except for NYC, and yet I don't see many companies moving to flyover country.
And of course, if a number of large employers all suddenly congregated in Austin, of course land prices would go up, salaries go up, etc...this doesn't all happen in a vacuum.