The quest to clone the DNA of Silicon Valley and spawn new metropolitan tech centers around the U.S. – and the world – is not without challenges.
What high-profile corporate site searches like Amazon’s HQ2 competition highlight above all else are the importance of a strong knowledge-based economy, something that is best achieved when tech companies set up in areas with strong, research-based universities.
Where are those knowledge centers, and how do they rank when compared to the mother of all innovation ecosystems: Silicon Valley?
According to the recently updated Milken Institute’s Best-Performing Cities index, one of those places is Utah’s Provo-Orem metropolitan area which took the No. 1 spot in the Milken index for a second consecutive year. The ranking reflects the robust growth of high-tech industries outside the coastal enclaves – read Silicon Valley –that launched the digital revolution.
Provo-Orem is home to Brigham Young University, a top technology-transfer school, and fast-growing technological and entrepreneurial communities. Major employers include Qualtrics International, a customer-survey software firm, and San Jose-based Adobe Systems. In the five years ending in 2016, the metro’s tech-sector GDP grew 31 percent faster than the national tech sector.
Several other Middle American cities also made the top-10 list.
This success did not preclude growth in Silicon Valley, where the city of San Jose rose nine places to finish second, aided by the concentration of tech giants such as Apple and Google.
Third place in the listings went to Austin, Texas, which gained nearly 5,000 jobs in its professional, scientific, and tech-services sectors during 2017.
According to a Milkin Insitute press release, “Tighter competition for talent and rising housing costs have pushed some firms to expand outside the big coastal centers, driving growth inland,” said Kevin Klowden, executive director of the Institute’s Center for Regional Economics and California Center.
Below is the complete list of American cities that made it to the finals, including last year’s ranking:
Top-10 Best-Performing U.S. Cities (previous year)
1. Provo-Orem, Utah (1)
2. San Jose-Sunnyvale-Santa Clara, California (11)
3. Austin-Round Rock, Texas (9)
4. San Francisco-Redwood City-South San Francisco, California (4)
5. Dallas-Plano-Irving, Texas (3)
6. Raleigh, North Carolina (2)
7. Orlando-Kissimmee-Sanford, Florida (7)
8. Seattle-Bellevue-Everett, Washington (17)
9. Fort Collins, Colorado (5)
10. Salt Lake City, Utah (10)
A testament to Big Tech’s ability to act as a magnet and regional anchor for tech development is Southern California’s Riverside-San Bernardino-Ontario area which is enjoying the knock-on effect of Amazon’s continued investment in a major logistics center. The city rose five places to No. 15.
Published annually since 1999, Best-Performing Cities: Where America’s Jobs are Created and Sustained (http://www.best-cities.org) measures the economic vitality of 200 large metros and 201 small cities. Metrics include growth in jobs, wages and salaries, and technology output. The rankings help policymakers, investors, and companies understand where local economies are thriving.
The full report with a table of all the metros evaluated is available online at http://www.milkeninstitute.org.