With talent growth centered around key hubs, tech execs called to look elsewhere

By: Roberto Torres

Dive Brief:

  • Tech job growth concentrated in a handful of coastal cities between 2010 and 2018, according to an analysis from the Brookings Institution. The top-10 metro areas with the highest shares of the digital services industry were home to 44.3% of tech jobs in 2018.
  • Five of the top 10 metro areas — San Francisco, Seattle, San Jose, Calif., Los Angeles, and Austin, Texas — netted 28% of all new job growth in the digital services space, upping their share of tech employment by 1.8%.?
  • By contrast, 21 cities grew their sector share in the same time frame, though they grew by less than one-tenth of a percentage point, according to Brookings.

Dive Insight:

New York, Seattle and San Francisco usually come to mind first when drawing a map of the country’s historic tech hubs.

There seems to be a “degree of group think” around why tech leaders continue to land and expand in the traditional tech cities, Mark Muro, senior fellow at Brookings Institution, told CIO Dive.

“We’ve been hoping to find and call the moment where the sector began to decentralize and spread out farther,” said Muro. “But we’re not there yet.”

Digital services delivered 80% of national growth in advanced industries growth from 2010 to 2018, according to the analysis.

As the labor market tightens in these hubs, expanding hiring and operative priorities into smaller markets could pose an advantage for tech leaders.

“CEOs should look at the array of activities in their coastal headquarters and truly consider what path can be placed somewhere else cheaper,” said Muro. “There should be financial benefits of that. There may also be other kinds of benefit in having access to a more inclusive workforce or new ideas and new places.”

A recent report from CompTIA highlighted Dallas, Texas for its potential as a growing tech talent hub. Companies there posted 134,000 jobs in 2019, with roles such as software development engineers and Java developers at the helm.

Read the full article here.

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