According to a recent study written up in the New York Times, college graduates are increasingly moving to less populated cities. Previously, New York, Washington DC and San Francisco had the largest migration of recent college graduates, but those cities are now being eclipsed by places like Denver, San Diego, Nashville, Salt Lake City and Portland, Oregon.
What does that mean for business growth? Where these college grads end up could be an indicator of the cities that have a chance to be the economic powerhouses of the future.
“There is a very strong track record of places that attract talent becoming places of long-term success,” said Edward Glaeser, an economist at Harvard and author of “Triumph of the City.” “The most successful economic development policy is to attract and retain smart people and then get out of their way.”
The economic effects reach beyond the work the young people do, according to Enrico Moretti, an economist at the University of California, Berkeley, and author of “The New Geography of Jobs.” For every college graduate who takes a job in an innovation industry, he found, five additional jobs are eventually created in that city, such as for waiters, carpenters, doctors, architects and teachers.
“It’s a type of growth that feeds on itself — the more young workers you have, the more companies are interested in locating their operations in that area and the more young people are going to move there,” he said.
Long story short – while college grads are choosing cities over the suburbs now more than ever, they’re choosing different cities post-graduation than in the past. As an executive search firm, we have seen the effects of this trend firsthand – in the publishing, digital, communications, big data and content industry as a whole. In past years, the bulk of our searches were located in New York and Los Angeles. Obviously, due to the growth of the digital world, the last few years have seen a huge uptick in searches based in San Francisco. However, even in the media world (that once was centered solely in NYC) we’ve had more and more searches in the past year than ever headquartered out of previously seemingly random cities – places in Colorado and even Kansas City. Approximately 50% of our searches in the content industry – even digital searches – are not located in NY, LA or SF. What does that mean for you? Be open to relocation – doing it yourself and moving an executive from a larger city to a smaller one. The talent with the background you are seeking might still be on a coastal city epicenter, but after a while, that talent gap will shrink. With the dawn of technology, a company can run itself anywhere and still have a meaningful impact across the US. Be be prepared to pitch your company and the selling points of the city you’ve chosen to locate it. After all, part of attracting talent is a great sales pitch.