The Expanding Geography of US Tech Talent

It's not just that talent is spreading, per se, but that the digital natives of the Millenial and Gen Z are more widely dispersed and frequently prefer to stay where they are rather than move to the coasts - or anywhere, making the distribution of talent broader. JL 

Richard Florida reports in CityLab:

Despite the continued dominance of a few coastal metro areas, many more affordable places have made considerable strides in attracting talent. These include larger metro areas like Austin, Salt Lake City, Phoenix, Nashville, Minneapolis-St. Paul, Kansas City, St. Louis, Oklahoma City, Des Moines, Omaha, Denver, Columbus, Pittsburgh and Cincinnati. Smaller college towns and cultural hubs like Ann Arbor, Michigan; Madison, Wisconsin; and Iowa City, Iowa, also rank as significant talent hubs.

Talent is a driving force, if not the driving force, in the wealth of places. But highly educated knowledge workers are not evenly distributed. Over the past couple of decades, these workers have become massively concentrated in coastal superstar cities and tech hubs, forming an increasingly uneven winner-take-all geography.

That geography of talent appears to be shifting in subtle but significant ways, according to a new study I co-authored for the think tank Heartland Forward.

Coastal superstar cities and leading tech hubs like San Francisco, San Jose, Washington, D.C., Boston and New York continue to top the list of talent. But smaller and medium-sized metros farther inland and across the center of the country are gaining significant ground.

In the analysis, I chart two basic measures for talent: educational attainment, based on the share of adults who hold a bachelor’s degree or higher; and occupation or workforce skill, based on the share of the workforce engaged in knowledge, professional and creative occupations (what I call the creative class). The analysis covers all 384 U.S. metropolitan areas and runs up to 2019, just before the pandemic, which likely accelerated some of these trends.

The big takeaway: Despite the continued dominance of a few coastal metro areas, many more affordable places have made considerable strides in attracting talent in the nation’s heartland, which according to our definition covers 20 states in the center of the country running from the Midwest to the Sun Belt.

These include larger metro areas like Austin, Nashville, Minneapolis-St. Paul, Kansas City, St. Louis, Oklahoma City, Des Moines, Omaha, Columbus and Cincinnati. Smaller college towns and cultural hubs like Ann Arbor, Michigan; Madison, Wisconsin; and Iowa City, Iowa, also rank as significant talent hubs.

My analysis looked not just at total share of college grads and knowledge workers, as in the maps above, but also at the growth in both categories of talent between 2010 and 2019. Among metro areas with more than 1 million people, Nashville saw the most growth in college grads, spiking 8 percentage points — although at 38.5%, it still lags talent hot spots like the San Francisco Bay Area and Washington, D.C., where more than half of the population has a bachelor’s degree.

When it comes to knowledge, professional and creative workers in big metro areas, San Francisco gained the most, despite its pre-existing dominance, followed by Pittsburgh. St. Louis, Columbus and Oklahoma City also cracked the top 20 for creative class growth. 

The findings show that America’s talent geography is changing, but in relatively nuanced ways. A few decades ago, coastal cities attracted talent because of their thick labor markets and unique bundles of amenities — like restaurants, cafes, nightlife and museums — that knowledge workers with a choice about where to live could not find elsewhere. But over the past decade or so, as these places have become more expensive, smaller metros in the center of the nation have worked hard to improve their offerings, adding bike trails and other outdoor amenities and drawing in better restaurants, cafes and music venues, in part because of their more affordable real estate.

While the data point to success stories, the winner-take-all geography of talent remains an inescapable feature of the modern knowledge economy. Unfortunately, not every place can be a talent winner. The places that have gained ground have assets like waterfronts or mountain scenery, research universities, well-endowed local foundations, corporations and anchor institutions that enhance both their business environments and their quality of life. But too many other places continue to lose talent.

When all is said and done, the new geography of talent looks like a slightly more dispersed and stretched out version of the old.