Many of the movers and shakers of today's information economy are not content with such settings; they prefer the vibrancy, diversity and architecture of core cities -- and are voting with their feet. There is even rising tension in San Francisco, because executives and employees from Silicon Valley are preferring to set up shop and live within the city -- thereby raising property values and rents. Other cities are a bit more welcoming of the creative and tech influx to their inner cores, especially distressed urban areas such as Detroit.
"This old notion that high tech is only in a suburban 'Nerdistan,' this idea that engineers prefer to live out near suburban office parks," is outdated, says Richard Florida, author of The Creative Class and professor at New York University and the University of Toronto. In a recent chat posted at the McKinsey site, Florida says he is finding interest among both established and startup companies in relocating in central cities across the world -- from New York to London to Berlin.
To capitalize on this trend, corporate decision makers need to recognize that human capital is the most important resource in an information-intensive business. Buildings and facilities are only secondary, and building edifices in the suburbs may not attract the talent needed.
As Florida put it in the interview:
"Economic development used to be, 'I want to collect company headquarters. I want to bribe company factories to come.' .... In mature cities, the universities, the colleges, the idea–knowledge hubs, these anchor institutions for talent, not only because they’re direct economic generators. But because they cause a flow of talent towards them. I think those are the components of the new economic-development strategy, which is about not only attracting companies, not only building businesses, but attracting people and creating really important, great assets that make your city livable and improve its quality of play."The influx of talent and entrepreneurial energy to selected parts of cities is setting up stresses as well, Florida notes. Cityscapes are increasingly divided between up-and-coming areas and distressed areas. The success seen in creative and tech areas needs to spill over.
(Thumbnail photo: Joe McKendrick.)