The metro area of New York City could soon become more akin to Bay Area.
That is, if Amazon, as reports show, selects New York's borough Long Island City as one of two locations where approximately 25,000 employees will be added next year. The move would be part of the company's recent decision to divide its much-visited second headquarters into two cities. (Although this decision would actually mean that Seattle remains the actual headquarters of Amazon, the two HQ2s only make it really big branches.)
And Google is preparing to hire thousands of employees in the Big Apple, the Wall Street Journal [add. reported last night. The search giant is about to buy or rent new office space that could accommodate up to 1
Office extensions do not usually get much coverage, but the news that Amazon and Google – US companies with some of the largest market capitalization – betting that their future is set on New York City should trigger alarm bells in other cities in the country want to build their own tech industry.
Last year, Amazon was booming in the public search for its second headquarters, and Google essentially said in a much more subtle announcement on a win-win that they would become too big for their respective hometowns Seattle and Mountain View. This is because the cost of living in these areas continues to rise and it is nearly impossible for many workers in the Bay Area to buy a home. Surveys have shown that a significant percentage of workers in the Bay Area and Silicon Valley are considering relocating.
But if technology companies and their workers become dissatisfied with the Bay Area due to the high cost of living, the logic would dictate that they are looking somewhere with much lower cost of living. That was the foundation for the plots of cities like Detroit, which offered Amazon millions of millions of subsidies and reduced office space. These incentives along with lower cost of living seem to make cities like Detroit ideal locations for the creation of Amazon.
And as VentureBeat reports this year, companies in places like Pittsburgh and Denver – backed by their Local Business Development Groups – are trying to exploit this dissatisfaction in the Bay Area by helping workers in the Bay Area to lower their living costs exploiting the respective cities.
But as Google and Amazon's expansionary decisions can soon prove, technology companies are evidently on the move For a city with a high cost of living – it just needs to be a bit lower than the Bay Area, which is not difficult.
Access to a large pool of tech talent is still the deciding factor when it's big Technology companies want to expand – not how low the cost of living is, not how cheap the rules are, not how low the taxes are (though these can all be useful tools to promote local startup communities). Amazon has reportedly decided to divide the HQ2 into two cities, worried that its main decisions – Long Island City and Crystal City, Virginia (outside of Washington, DC) – might not be enough to fill the 50,000 jobs has planned.
If Amazon does not believe that two of the largest metropolitan areas in the US have sufficient technology talent, Heartland cities should realize that training more technicians must be a top priority. My advice? Invest more in research universities and create alternative ways for students who want to enter the tech industry without completing a four-year degree. Look for ways to attract not only US college students but also foreign students to meet with your local tech startups.
VentureBeat Reports Earlier This Year on Utah's Growing Tech Community, One of the Biggest Companies in the US The mood most often voiced by engineers in the region is that they feel comfortable, looking for a job with a start-up company in Utah as soon as they knew there were other companies that they would be interested in if their job at their current company went down. 19659002] When Heartland cities fail to meet the talent needs of big tech companies and more of these giants move to New York City or DC, or to other, slightly cheaper coastal cities, it's not just bad for the Midwest. It will be bad for the rest of the country as the highest paid jobs are simply exchanged between the few cities. The New York Times put it this way: "The rich get richer and they get Amazon."