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Raleigh has a cost of living below the national average
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The concentration of wealth is in a few elite cities.
TECH CENTER

There is one US tech hub where the cost of living is below the national average

By Michelle Cheng

While there are signs that some big tech firms are expanding outside the pricey San Francisco Bay Area, a new report from jobs site Indeed suggests they aren’t straying too far from their roots.

Nearly a third of the tech jobs posted on Indeed last year were located in just eight metro areas with a population of at least 1 million. These tech hubs are much more similar than different: Six of them are on the east or west coast. All lean left politically. But only one—Raleigh, North Carolina—has a cost of living below the national average.

The southern US city, surrounded by high-research universities, has an up-and-coming entrepreneurial tech scene. And unlike San Francisco, where the median home price is around $1.3 million, in Raleigh the median listing price for houses is under to $330,000.

Despite rising labor and housing costs in the other US tech hubs, 31.7% of all new tech jobs in 2018 were located in the eight big metros identified by Indeed, up from 31.1% percent in 2017.

The high demand for specialized skills in fields like artificial intelligence and IT helps explain the fast growth of tech jobs in these hubs. Not surprisingly, Indeed found that the Bay Area, long the dominant player in tech, has the highest concentration of high-paying, rapidly expanding tech jobs such as data scientists and cloud engineers, while Washington DC has a foothold on IT and network security specialists.

Overall, the tech industry accounted for 6.6% of Indeed job postings in metros with populations over 1 million, versus just 3.3% in the metros with at least a quarter million people.

The data helps illustrate how tech wealth continues to be concentrated in very few coastal towns. 

But the big paychecks in these hubs are perhaps not as lucrative as they appear. While salaries are high in cities like San Francisco and Seattle, they often go straight back to exorbitant rents and $15 salads. To make their pay go farther, job seekers may want to look outside of the eight biggest hubs for more opportunities.

Smaller hubs identified by Indeed include Ann Arbor, Michigan; Durham-Chapel Hill, North Carolina; Huntsville, Alabama; Colorado Springs, Colorado; and Palm Bay-Melbourne-Titusville, Florida. 

Though they lack the venture-capital funding and deep technical skills of the big hubs, the smaller tech areas, according to Indeed, tend to be more affordable and, as a group, are more diverse geographically, economically, and politically than the big hubs. Indeed notes that five of the 10 leading smaller tech hubs voted for Donald Trump over Hillary Clinton in 2016, while Clinton took each of the eight largest hubs by at least a 10-point margin.

Located near military facilities and universities, many of these smaller tech centers offer more of a mix of jobs, which can be harder to find in highly saturated tech markets. That’s great for both employers and employees who are looking for something a little different.