Study: Denver a ‘rising star’ for rapid growth in tech jobs amid pandemic
Will the shift to remote work during the pandemic have a long-term effect on the geographic shift in tech employment?
Our Founder, Helen Young Hayes, was featured March 8, 2022 by the Denver Business Journal.
Denver has emerged as a rising star in the battle of the tech hubs, part of a trend of remote work expanding some urban opportunities that’s happening alongside the continuing dominance of coastal superstar cities.
While established locales like San Francisco, Seattle, New York and Austin, Texas, continue to rule the tech employment sector, Sun Belt and Heartland cities like Denver and Dallas also have seen a significant surge in tech jobs over the past five years, a study by The Brookings Institution found.
In 2020, amid the coronavirus pandemic, tech sector employment growth slowed in the biggest, most dominant tech centers while nearly half of the nation’s 83 other large metro areas saw their rates increase.
Overall, nine rising star cities — Denver; Atlanta; Dallas; Miami; Orlando; San Diego; Kansas City, Missouri; St. Louis and Salt Lake City — increased their share of U.S. tech job postings from 14.5% in September 2016 to 16% at the end of 2021. The report found that Denver, along with Miami, had particularly vibrant growth in hiring ads during the Covid-19 pandemic and added tech jobs at an annual growth rate in excess of 3%.
Tech sector employment in the Denver-Aurora-Lakewood metro area grew from about 50,000 in 2015 to 64,000 in 2019, and despite the ongoing challenges of the pandemic, Denver’s tech employment continued to rise at a steady pace from 2019 to 2020, climbing 4.6% to around 67,000.
The metro area has proven its ability to attract tech talent. Commercial real estate and investment firm CBRE’s 2021 Scoring Tech Talent report ranked Denver No. 12 overall in tech talent across North America based on an analysis of 13 metrics ranging from tech graduation rates, tech job concentration, tech labor pool size, and labor and real estate costs.
The CBRE study found that Denver’s tech sector employment gain was driven by young talent moving to the city, and that local employers have been able to keep tech wages competitive, with an average pay of $107,481 ranking ninth highest in North America.
Still to be seen is whether the shift to remote work during the pandemic will have a long-term effect on the geographic shift in tech employment. Some large tech employers such as Google are asking some employees to return in-person, with Google planning on a hybrid work week involving two days remote. Brookings cited forecasts that show that work patterns at least in the near future will likely follow a hybrid pattern requiring that tech workers appear in-office two or three days a week, limiting their ability to fully exit from established hubs.
The U.S. Department of Labor recently reported that one-third of companies increased remote work for some or all of their employees during the pandemic, and that 60% of those companies expect to make those changes permanent after the pandemic ends.
But Brookings said that while more widespread acceptance of remote work in the tech sector over time could lead to greater dispersion of workers and tech activity, and the shift to remote work during the pandemic may have played a slight role in job growth in the rising cities, the flow of workers away from high-cost metro areas has been modest thus far and does not seem to forecast a wholesale decentralization of tech.