Austin Climbs To #6 On CBRE’S Annual “Scoring Tech Talent” Report
Above average educational attainment and tech talent labor concentration contribute to Austin’s rise in the ranking…
Austin moved up two spots to #6 on CBRE’s Tech Talent Scorecard, part of its sixth-annual Scoring Tech Talent Report, which ranks 50 U.S. and Canadian markets according to their ability to attract and grow tech talent.
Tech labor concentration – or the percentage of total employment – is an influential factor in how “tech-centric” the market is and its growth potential. Austin has a tech talent labor pool of 69,610, or 7 percent of its total employment, compared to the national average of 3.5 percent.
The top five markets for tech talent in 2018 were the San Francisco Bay Area, Seattle, Washington, D.C., Toronto (the first time a Canadian market made the top five) and New York, all large markets with a tech labor pool of more than 50,000.
The Tech Talent Scorecard is determined based on 13 unique metrics, including tech talent supply, growth, concentration, cost, completed tech degrees, industry outlook for job growth, and market outlook for both office and apartment rent cost growth.
Austin stood out in the report in a number of key areas:
- Austin rose to #6 in North America (up from #8 last year), surpassing Raleigh-Durham (ranked #7 last year) and Atlanta (ranked #5 last year)
- With a rate of 49.2 percent, Austin ranked #7 among the top markets for educational attainment, behind Seattle, Madison, Washington, D.C., Atlanta, Portland and Raleigh-Durham. The U.S. average is 31.3 percent.
- Austin’s tech talent labor pool grew 20 percent during the past 5 years adding 12,000 tech workers to the metro area. The tech talent labor pool comprises 7 percent of the metro’s total employment – a significant cluster when compared to other Texas markets.
- Tech talent in Austin continues to rate high on the quality vs. cost analysis, meaning wages for an average software engineer are well priced compared with the high level of quality working in the metro.
- Austin produces a strong number of tech graduates but continues to attract talent and has added more than 1,000 more tech jobs than tech graduates during the past 5 years.
- Comparing the annual average apartment rent with the annual average tech-worker salary, Austin’s rent-to-tech wage ratio is just 15.3 percent, making Austin a much more affordable place to live for tech workers when compared with other top ranked markets.
“It’s not surprising to see Austin move up on the list this year. The city is growing rapidly and offers tech firms and their employees an increasingly competitive quality of life when compared to larger markets such as New York City or Seattle.”” says Erin Morales, Senior Vice President at CBRE in Austin.
“In addition, Austin’s labor quality continues to be considered some of the best in the country. With large universities in town and strong recruitment from other markets, tech firms are able to feel confident in their ability to find skilled talent in Austin,” continued Morales.
Top 10 tech talent markets:
| 2018 RANK | MARKET | SCORE |
| 1 | SF Bay Area, CA | 84.72 |
| 2 | Seattle, WA | 74.46 |
| 3 | Washington, D.C. | 67.70 |
| 4 | Toronto, ON | 65.38 |
| 5 | New York, NY | 64.04 |
| 6 | Austin, TX | 60.17 |
| 7 | Boston, MA | 58.14 |
| 8 | Raleigh-Durham, NC | 57.95 |
| 9 | Atlanta, GA | 57.76 |
| 10 | Denver, CO | 56.72 |
CBRE’s interactive Tech Talent Analyzer found the San Francisco Bay Area, Austin and Seattle to be the most competitive markets to hire tech talent based on labor market supply/demand, wage costs and talent quality.
“Strong economic conditions and tightening labor markets are constraining tech talent job growth and increasing costs,” said Colin Yasukochi, director of research and analysis for CBRE in the San Francisco Bay Area. “This has accelerated the expansion of tech talent pools across the U.S. to meet this demand, starting with increased numbers of tech degree graduates. Accordingly, demand for commercial real estate in large and previously under-utilized regions is on the rise from both start-ups and established companies.”
View the full report here. To view individual market statistics and rankings, including rankings on the Scorecard, access CBRE’s Tech Talent Analyzer.
CBRE Group, Inc., a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2017 revenue). For more information visit their website at www.cbre.com.
