When Amazon announced the 20 finalists in their Hunger Games-style runoff for a second HQ and the 50,000 six-figure jobs that come along with it, they did more than get the salivary glands of econ-dev teams across the country flowing. They also highlighted the rise of one of the most optimistic and interesting stories in the contemporary American economy: The rise of new tech boomtowns in areas once relegated to flyover status in the minds of many technology CEOs.
The fact that Amazon is considering places like Columbus, Indianapolis, Nashville, Denver and Pittsburgh provides still more evidence that the country is filled with places where you can find the best and brightest and build a world-class business without breaking the bank.
That’s particularly important a time where the nation’s business leaders are increasingly concerned with the availability of talent, especially technology talent in Silicon Valley or the hyper-expensive Boston-New York-DC corridor.
“the fact that Amazon is considering places like Columbus, Indianapolis, Nashville, Denver and Pittsburgh should be welcome news to everyone trying to grow their business in America.”
None of which is likely breaking news to most CEO reading this. But as Joel Kotkin, the presidential fellow in urban futures at Chapman University and executive director of the Center for Opportunity Urbanism wrote in a recent essay for Chief Executive on America’s New Boomtowns, there’s a growing democratization of talent across the country. It’s gaining steam as more and more of the nation’s best and brightest decide that they’d like to seek opportunity in a place where they can do interesting work for a top-notch employer—and own a house. No matter what your TV tells you, not every ambitious young executive wants to live with four roommates in a Bushwick basement.
“The fastest growth in educated millennials today is taking place not in New York, Washington or San Francis co, but in opportunity cities like Nashville, Denver, Charlotte, Raleigh and Orlando,” writes Kotkin. “Growth in tech and professional services in these areas suggest a new trend. At a time when tech growth has slowed in the Bay Area—down by 80 percent over the past two years…it has been surging in many of these cities. The fastest growth in tech jobs has taken place not in San Francisco, but in Charlotte. Nashville, Raleigh, Indianapolis, Phoenix, Denver and Salt Lake City all grew their tech ranks faster than such superstars as New York, Los Angeles and Chicago.
“Demographic trends could drive this further as millennials and young families struggle with ultra-high costs. In New York City, millennial incomes (ages 18–29) have dropped in real terms compared with the same age cohort in 2000—despite considerably higher education levels—while rents increased 75 percent. New York, Los Angeles and San Francisco have three of the nation’s four lowest homeownership rates for young people and among the lowest birthrates.
“According to Zillow, for workers between 22 and 34, rent costs claim up to 45 percent of income in the Los Angeles, San Francisco, New York and Miami metropolitan areas, compared with closer to 30 percent of income in metros like Dallas-Fort Worth and Hous- ton. Even more stark is the difference in home prices. In Dallas-Fort Worth (the nation’s fastest-growing housing market) as well as Houston, San Antonio and Charlotte, prices can be just one-third of those in the superstar cities.”
Of course, the list is chockablock with traditional HQ cities, including New York, Boston, Atlanta, Chicago, LA, Dallas, Philadelphia and Miami. And by including Montgomery Country, Northern Virginia and Washington DC, Amazon has really only produced a list of 17, not 20, locations.
But whether they win or not, the fact that Amazon is considering places like Columbus, Indianapolis, Nashville, Denver and Pittsburgh should be welcome news to everyone trying to grow their business in America.