Earlier this week, CBRE released a report titled, “Scoring Tech Talent”, which examines the top labor markets in the country regarding jobs in the technology sector, as well as a host of data comparing the markets.
What is “Tech Talent”? According to the report, “Tech Talent is a group of highly skilled workers, in over 20 technology oriented jobs, found across all industry sectors. They are drivers of technological innovation.” Impressive. They are also driving our economy forward and significantly impacting the national office market.
I immediately skimmed the report to see if New Jersey was represented and found that it is, and in a big way. Edison, New Jersey is ranked as the top small tech market in country and Newark, New Jersey is not too far behind. Unfortunately, the news isn’t all positive for New Jersey. Edison and Newark are two of only three cities in the top 50 that are actually contracting instead of growing.
Some surprising stats:
- Baltimore and Detroit are both in the top 5 with respect to job growth in the tech sector.
- Washington, D.C. has the largest tech talent labor pool, while Chicago, Dallas/Fort Worth, and Minnesota are all in the top 10.
But what I found when I really dug in to the data really stuck out.
Tech companies are willing to spend money to be in the most expensive markets because that’s where the talent is.
When considering real estate costs and employee salaries, the top five most expensive markets on the list are Silicon Valley, San Francisco, San Francisco Peninsula, New York, and Washington, D.C. Those are also the top five ranked markets in the country according to the report, although not in that order.
The tech jobs in San Francisco alone have increased by more than 40% since 2010, and the average office rents have more than doubled in that time. Is it a coincidence? Absolutely not.
I am hoping this trend helps our local economy. As I have discussed in the past, while inexpensive real estate can be found in New Jersey, the cost of living is high. This leads to higher salaries. But we do have a talented workforce, as evidenced by the inclusion of two markets within the top 50 in the country. They key is to not only retain that talent, but also attract new talent.
If you would like to read the full report, please click here.