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What's Driving High-Tech's Urban Love Affair?

Richard Florida chronicles the reasons why high-technology firms are increasingly vacating suburban office parks and "nerdistans" for urban addresses, from London to Los Angeles.
September 4, 2012, 5am PDT | Jonathan Nettler | @nettsj
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Although the decidedly suburban Silicon Valley remains the world's pre-eminent center of the high-tech industry, start-ups and smaller firms are putting down roots in urban areas such as New York City's Silicon Alley and London's Shoreditch district, in order to lure coveted employees, connect to customers, and spark innovation. 

According to Florida, the reasons for this migration are many. For one, "Compared with previous generations, today's younger techies are less interested in owning cars and big houses. They prefer to live in central locations, where they can rent an apartment and use transit or walk or bike to work, and where there are plenty of nearby options for socializing during nonwork hours." 

It's not just young professionals that are attracted to citiesm however. "With all their cultural and intellectual amenities, urban centers are also the preferred locales for many leading scientists and engineers."

"An even bigger part of the story is rooted in the changing nature of technology itself," notes Florida. "A generation or so ago, the fastest-growing high-tech companies were more like factories," requiring large spaces (most readily and cheaply available in the suburbs) to located their operations. But, "The changing nature of technology-cloud-based applications in particular-enable new start-ups to succeed more quickly, with smaller teams and much smaller footprints."

"Cities are central to innovation and new technology," concludes Florida. "They act as giant petri dishes, where creative types and entrepreneurs rub up against each other, combining and recombining to spark new ideas, new inventions, new businesses and new industries." 


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Published on Friday, August 31, 2012 in The Wall Street Journal
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