Austin, meanwhile, is a mere ‘satellite’
By Stephen Council Jan 2, 2024 (SFGate.com)
During the pandemic, the Bay Area lost thousands of residents to smaller cities around the country, prompting speculation that the region had lost its tech-mecca status. But a new report from the Harvard Business Review argues that many of those people — and the cities they moved to — remain firmly tied to San Francisco.
Urban studies professor Richard Florida and three city-focused consultants wrote that San Francisco is a hub of a “Meta City,” which they define as a web of cities that share talent pools and industries. By framing it that way, Florida told SFGATE on Friday, they argue out-migration and remote work aren’t necessarily bad for the Bay Area, but could serve to expand its “digital hinterlands.”
“In the technology world, San Francisco remains the center. It remains the sun on which the planets orbit,” Florida said. Those “planets,” the authors wrote, include Austin, Seattle and Portland, as well as larger talent hubs like New York and Los Angeles.
Indeed, the Bay Area has maintained an outsized influence on the tech industry even as more of the corporate world embraces internet-based tools. More venture capital funding went to Bay Area companies from July to September than to those based in New York, LA, Boston and Austin combined, according to the investment tracker Pitchbook. San Francisco, with companies like OpenAI and Anthropic, has staked a key claim in the artificial intelligence hype, and in 2021, Air India chose San Francisco as the first U.S. city with nonstop flights from the tech hotspot Bengaluru.
The Harvard report, titled “The Rise of the Meta City,” and published on Nov. 29, relies mainly on a set of LinkedIn user data provided to Boston Consulting Group. The authors looked at worker location trends from August 2022 to July 2023.
Citing the mass of venture funding and two-way migration streams with other major cities, the authors called San Francisco “the world’s leading high-tech hub and the anchor of its global innovation ecosystem.” They also found “pipelines,” cities that they said had been “tied together” by similar companies, professional opportunities and talent pools.
New York provided six times more new residents to Miami-Fort Lauderdale, for example, than any other city, per the LinkedIn data. And San Franciscans poured into Austin at twice the rate of New Yorkers and more than 1.5 times the rate of Angelenos.
“Similar to New York’s relationship to Miami, Austin is best understood as a satellite of the San Francisco tech complex,” Florida and co-authors Vladislav Boutenko, Antoine Vetrano and Sara Saloo wrote.
Tesla may be the perfect example to illustrate the authors’ idea that those worker and company migrations are not a zero-sum game, but deepen places’ connections. Though Elon Musk infamously moved his company’s corporate headquarters from Palo Alto to Austin in 2021, he continued to expand and invest in the Bay Area. This February, he opened up a new Tesla engineering headquarters at Hewlett-Packard’s old Palo Alto office park, praising the region’s tech talent.
Florida, who also wrote the 2002 book “The Rise of the Creative Class,” said that he thinks about remote work as, in part, a corporate tool of influence. As tech giants like Salesforce and Apple expand across the country, more workers are doing the bidding of Bay Area-based executives, meeting remotely with Bay Area colleagues, and contributing to Bay Area companies’ bottom lines. And with the area’s central role for startup funding and conferences, even those who leave for other companies, Florida said, will find “the axis of their profession remained in San Francisco.”
“We have binaries,” Florida said, of urban studies discourse. “It’s either the city is a physical artifact with people who live and work there, or the city is not important, everything’s moving into the cloud. I think what this article tries to do is say, ‘It can be both. Those two things don’t have to exist in opposition.’”
Florida also pointed to the rising costs of living in Austin, Miami and Nashville, and said that as prices in the tech “satellites” rise, San Francisco may seem more appealing again. In October, SFGATE spoke with several people who’d entered the tech workforce elsewhere but decided in 2023 to move to the Bay Area. Florida expects that to continue, especially if the city can build its downtown to be better suited for community and connection.
“You’d have to be a lunatic, sorry, to bet against San Francisco,” he said.
Hear of anything happening at a Bay Area tech company? Contact tech reporter Stephen Council securely at stephen.council@sfgate.com or on Signal at 628-204-5452.
Jan 2, 2024
Stephen Council is the tech reporter at SFGATE. He has covered technology and business for The Information, The Wall Street Journal, CNBC and CalMatters, where his reporting won a San Francisco Press Club award. Signal: 628-204-5452 Email: stephen.council@sfgate.com
