Posted on 12/10/2019 11:18:21 AM PST by SeekAndFind
The United States has a total area of 3,796,742 square miles. That makes it the third or fourth-largest country in the world by land area, depending if you count overseas territories. So what's the point? Despite its size, the U.S. is facing a dilemma of sorts.
According to a new report from The Brookings Institution, regional divergence in the U.S. innovation sector "has reached extreme levels." The innovation sector, composed of 13 of the nation’s highest-tech, highest R&D industries, is vital to the U.S. economy. The innovation sector accounts for 3% of U.S. jobs, but generates 6% of the country’s GDP, a quarter of its exports and two-thirds of business R&D expenditures. The industries, such as software, pharmaceuticals and semiconductors, consist of workers with degrees such as science, technology, engineering and mathematics.
The report found that job gains in the innovation sector are becoming highly concentrated to a handful of "superstar" metropolitan areas. Boston, San Francisco, San Jose, Seattle and San Diego captured more than 90% of all new jobs in the innovation sector from 2005 to 2017. These cities' share of the nation’s innovation sector employment increased from 17.6% to 22.8% during this period.
One-third of the nation’s innovation sector jobs are now in just 16 counties, with more than half concentrated in 41 counties. The hardest hit cities, in terms of losing innovation sector jobs over this period, include Chicago, Philadelphia, Dallas and Los Angeles.
The report discusses some of the negative externalities as a result of innovation sector jobs clustering to a few cities. The most obvious is housing. A separate report from PropertyShark found that California is home to 73% of the nation’s priciest zip codes. The Bay Area alone is home to 55 of the nation's 125 most expensive zip codes.
One of the other negative externalities the report focuses on is what it calls the "sorting of workers." This happens as college-educated workers are moving to a handful of cities, leaving those metro areas they've moved from with weaker talent pools. This can cause areas of underdevelopment, which in turn, can lead to broader social issues.
So what does The Brookings Institution suggest as a solution to this issue? They believe the U.S. government should counter this divergence by selecting eight to ten new “heartland” metro areas that can be transformed into "regional growth centers." The report provides a list of 35 metro areas that are ideal candidates for transformation. Madison, Wisconsin, the greater Minneapolis, Minnesota region and the greater Albany, New York region are listed as the most eligible locations. At an estimated cost of $100 billion over ten years, The Brookings Institution points out that it is "substantially less than the 10-year cost of U.S. fossil fuel subsidies."
As Market Crumbs wrote yesterday, technology companies are expanding, but are increasingly heading to New York City. Doing so doesn't solve any of the issues The Brookings Institution identifies in its report. If the government takes their advice and tries to develop these regional growth centers, there is sure to be plenty of debate as Amazon's search for its HQ2 last year showed what happens when governments try to attract corporations.
in·no·va·tive
adjective
(of a product, idea, etc.) featuring new methods; advanced and original.
"innovative designs"
(of a person) introducing new ideas; original and creative in thinking.
"an innovative thinker"
One reason for reports like this: If you are doing a tech startup, venture capital funds will force you to move your company to one of those small number of locations.
On one hand, it’s their money and they have the right to want the people they invest in to be close, so they can supervise their investment.
On the other hand, it enforces a sameness in workforce and ideas. Not what you expect in the area of ‘innovation’.
Thank GOD, not TEXAS, let the freaks move to SF, Boston, et. al. and keep Texas a RED STATE.
I’m so tired of the ruin that liberals bring to Texas. I was sure they were going to say everyone move to Austin, Dallas, and Houston metro areas.
Get rid of guest worker programs and any problems would solve themselves. Without a pipeline of indentured servants, smaller cities (and their people) would be sought for what stays onshore.
Yes you hit proverbial nail on head. They consider it unfair that certain areas have attracted these types of business activities. And they want government to impose some solution to this alleged problem, rather than letting the free market and capitalist activity, decide where these businesses will locate.
Dump the H1B Visa program and do an extreme limitation on foreign education visas. Of course our education system is entirely toast with liberals in charge. Most can’t read or write, do basic math, or speak properly. You want things fixed you have to delete most of the “educators” from being part of education. Curriculum changes are step 2.
The above situation is partially due to local/state government leadership (both Democrat at the time) making a huge bluff on a huge employer (cash register company). They lost and the area has steadily lost private sector tech firms.
As for guest worker fraud, my area also has that covered. They managed to innovate by undercutting potential interns as well as regular individuals - with those "New Jersey" style firms.
Did I miss the most sacrid names....
The Brookings Institution is a left-wing think tank. Evaluate anything they write with caution.
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