San Francisco is still the world’s top tech city but as skilled workers are flocking to cities with cheaper living costs, its position could be under threat, according to CBRE.
CBRE’s annual report, Scoring tech talent, ranks 50 US and Canadian markets on their success at attracting talent.
Author Colin Yasukochi said: “Tech talent growth rates are the best indicator of labour pool momentum, and it’s easily quantifiable to identify the markets where demand for tech workers has surged.”
Established tech hubs such as Washington DC, Seattle and San Francisco’s Bay Area secured top spots on the “talent score card”, and New York and Austin rounded up the top five – a jump for Austin which was at eighth place last year.
But smaller markets like Nashville and Charlotte led the race on talent growth, with increase rates of 75% and 68% respectively.
Yasukochi said: “The robust entrance of millennials into the labour pool contributed greatly to the growth in tech talent across all 50 downtown markets in our ranking this year.”
Education and cost of living were also key influencers in tech markets, with almost 70% of the top 50 tech talent markets having an educational attainment rate above the US average of 30%. Seattle and Washington DC boasted more than 50% of residents aged 25 and older with bachelor’s degrees or higher.
The top 10 markets, ranked by the number of tech degrees completed were New York, Washington, DC, Los Angeles, Chicago, Phoenix, Boston, the San Francisco Bay Area, Atlanta, Columbus and Detroit.
Cities that housed higher education institutions were also seen to attract higher concentrations of millennials. Madison, Pittsburgh and Boston took the top spots with 25% or more of the population comprising of millennials.
Washington DC had the fastest rate of millennial growth at 27.1% since 2009, and Salt Lake City and Richmond increased by more than 10%.
The San Francisco Bay Area and Dallas were the largest net job creators. Boston and Phoenix had net job creation deficits.
CBRE noted that 36 of the top 50 markets had a cost of living above the national US average.
Tech wages were found to cover the high cost of living when compared to the average apartment rent. Oklahoma was the most affordable city with a wage-to-rent average ratio of 12%.