The escalating war for tech talent in major tech hubs is real. Unemployment in traditional tech hubs like Silicon Valley and San Francisco is historically low at a time when tech drives 24.2 percent of U.S. office leasing activity. While these hubs boast access to talent and a culture of innovation, they command high real estate and talent prices. But if you’re a growing tech company looking for both talent and affordability, you may be in luck
Focusing on the ecosystem of a market can reveal many things. For instance, if there is already a community of specific occupations, it’s likely that future job creation will be easier. It may also mean an industry’s stability in a location may be stronger in the face of economic cycles.
Perhaps the most significant dynamic to take notice of is the ecosystem’s concentration of jobs rather than its quantity. For instance, New York City has the greatest number of computer programmers and software developers. However, the concentration of both is highest in Silicon Valley. Bottom line? The technology ecosystem is stronger in Silicon Valley.
Concentration factors aside, there is much more to Phoenix‘s tech ecosystem than what simply meets the eye.
Phoenix’s tech industry has been driven by heavy activity in Scottsdale and Tempe. The live-work-play concept has been so successful in these submarkets that tech companies—and startups in particular—are being priced out of the area. However, there is no reason to fear. The alternative submarket, the Warehouse District, is charming tech tenants who want relief from rising rental rates.
Regardless of the market and where it is in the real estate cycle, knowing where to find tech talent is at the core of any successful ecosystem. Check out the four trends driving tech company real estate decisions today.
- Tech Hub unemployment is historically low: Unsurprisingly, this is great for the local community. However, this is bad for tech companies looking to hire.
- New “hidden gem” start-up friendly cities have been revealed based on employment data on computer programmers and software developers, crossed with JLL real estate data. This data revealed lesser-known markets to be on the up-and-up, including Sacramento, Albany, and Colorado Springs.
- Key factors that shape an emerging tech hot spot include talent, real estate, affordability, and overall ecosystem strength.
- Concentration of tech jobs is a sign of hidden tech talent: When assessing cities outside traditional tech hubs, a strong indicator of the strength and sustainability of the tech ecosystem is concentration—more so than the total current volume of existing technology jobs.