Cool Counts in Luring Hot Techies

The No. 1 problem for high-tech firms these days is the shortage of skilled workers, especially those with the talent to make an entire company succeed. And the “talent wars”--firms raiding one another for top people--are going to get even worse. What’s also interesting is how the shortage is influencing the character of communities and, in turn, urban politics.

Richard Florida, a professor of public policy at Carnegie Mellon University in Pittsburgh, produced a fascinating report in January titled “Competing in the Age of Talent: Environment, Amenities and the New Economy” (https://www.heinz.cmu.edu/~florida/talent.pdf).

Florida’s yearlong study looked at how cities and regions compete for technical talent in the new economy, and the role that environmental and “quality-of-life” factors play in this competition.

“Knowledge workers,” says the report, “essentially balance economic opportunity and lifestyle in selecting a place to live and work. Thus, lifestyle factors are as important as traditional economic factors such as jobs and career opportunity in attracting knowledge workers in high-technology fields.”

Five years ago, some pundits claimed that the flexibility of the new economy would spell trouble for cities. George Gilder, for example, proclaimed that the Internet would lead to the “death of the city.”

What he didn’t anticipate is that young people tend to like being around other young people. The result is that hip, young technology companies have revitalized many downtown neighborhoods, as in Manhattan’s Silicon Alley, Seattle’s Pioneer Square, San Francisco’s China Basin, Santa Monica’s downtown area and Austin, Texas’ Congress Avenue.

Florida says that because young workers can essentially choose to work nearly anywhere, they gravitate to places that offer a fairly distinct mix of environmental quality, social life and “amenities,” including youth culture, sports, night life, music and “coolness”--in short, an urban identity that everyone knows exists but that is difficult to describe completely.

“Due to the long hours, fast pace and tight deadlines associated with work in high-technology industries, knowledge workers require amenities that blend seamlessly with work and can be accessed on demand,” Florida wrote.

Austin Mayor Kirk Watson--a young politician to watch with a record-breaking 82% of the vote in the city’s last election--is one of the few political leaders who seems to sense this transformation. Watson calls it “convergence.” He means that, just as city governments are trying to figure out how to reconcile economic growth with environmental quality and avoid sprawl, the dynamics of the labor market in high tech are helping point to a solution.

Young high-tech workers are not attracted to sprawling, remote and sterile suburban developments, or even to “edge city” clusters of campus-like high-tech companies. They want to be where the action is and, consequently, companies want to be there too. That provides growing support for so-called “smart growth” strategies, more dense and diverse communities, more redevelopment of under-used real estate and more attention to environmental quality in protected natural landscapes.

This is happening in Los Angeles too, although it is only just emerging. Jason McCabe Calacanis, editor of Digital Coast magazine, says Los Angeles is attracting young workers who want to put the Internet to use, the creative people who are more interested in content than in chips.

“They don’t care what browser people are using. They don’t care how fast your computer is,” Calacanis said. “Everyone thought that technology would be the driver of the new economy, but it turns out it’s content, it’s art. That’s why in L.A., you see energy and entrepreneurship.” He says the “epicenter of the Internet in Los Angeles” is the Coffee Bean cafe on 4th Street in Santa Monica.

Ross C. DeVol, a senior researcher at the Milken Institute, agrees with Calacanis. “In the recent past, we’ve had earthquakes, riots, fires, recession, etc.,” he says. “Sometimes Los Angeles can be its own worst enemy. But last year, we had the first positive domestic migration to Los Angeles in any year since 1989. That’s a good sign for L.A. Young people come here to work with cool technologies, like computer games, movies, animation, special effects and Web design.”

What this all means for political leaders eager to promote economic growth is that they now have to pay attention to the idea of a “place,” a concept far beyond the traditional blend of tax rates, labor costs and business infrastructure. The hot technology companies don’t have time for negotiations over tax abatements and new highways. They just want to be where the workers are. The workers want to be where the fun is. And political leaders now need to figure out how to get all those ingredients to work together.

This is all good news for those few places that have the right mix of a high-quality environment, plentiful outdoor activities, a robust urban youth culture and what Florida calls a “thick labor market” of talented young technical workers--in other words, lots of them with lots of churn, job-hopping and innovation.

Other places are unfortunately out of luck. There’s a steady “brain drain” going on across the U.S. as communities that are less than “cool” lose their best and brightest and thus slowly sink into economic stagnation or decline.

It’s also tough if you’re not a good fit with a hothouse culture of young, type-A personalities who do everything at top intensity. The emerging culture of the new economy is hard on older workers, workers with families and on women and ethnic minorities who haven’t absorbed the tastes and energy levels of young, affluent techies, entrepreneurs and new-media hipsters.

As with most other developments brought on by technology, these social changes tied to the new economy are Janus-faced--encouraging and discouraging, appealing and alienating, creating new winners and new losers all the time.

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Gary Chapman is director of the 21st Century Project at the University of Texas at Austin. He can be reached at gary.chapman@mail.utexas.edu. Recent Digital Nation columns are available at http://161.35.110.226/dnation.