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Why Some Cities Get All the Good Jobs (chicagotribune.com)
New submitter Ericmesrr writes with a link to a Bloomberg story (as carried by the ChicagoTribune) about geographic trends in job creation in the U.S, from which he excerpts this quote from U.C Berkeley economist Enrico Moretti: "A handful of cities with the 'right' industries and a solid base of human capital keep attracting good employers and offering high wages, while those at the other extreme, cities with the 'wrong' industries and a limited human capital base, are stuck with dead-end jobs and low average wages. This divide I will call it the Great Divergence has its origins in the 1980s, when American cities started to be increasingly defined by their residents' levels of education. Cities with many college-educated workers started attracting even more, and cities with a less educated workforce started losing ground."
I find this trend quite strange as well. In the late 90s everyone was going on about how technology would allow us to work from anywhere so we could spread out around the country. Things like cramming into an urban area, and flying to conferences were going to become unnecessary.
Instead what I've observed is that the rise of 'thinking' jobs, which only require a desk, have made it more and more viable for people to live in concentrated urban centres. Contrast this with industrial jobs where you needed large amounts of land for a factory which naturally led to suburban developments. Similarly the rise of cheap air travel has raised the expectation that you'll just turn up at a conference, so I find I have to attend more now.
I think this trend will continue until driverless cars are ubiquitous. These will open up huge amounts of land around urban centres (it will be like adding tube lines everywhere), and will probably cause a significant decline in central city density as people are freed from existing rent/transport monopolies.
Awe, thats cute.
You've just discovered something thats been happening since civilization started.
Cities rise and fall based on their usefulness at the time, not your nostalgic feelings about them.
The universe does not play favorites and isn't a fanboy, it doesn't artificially prop up things that should cease to exist, like worthless cities.
Its not just American cities, its all cities, across the entire world.
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An even better question is why things seem to work so well working remotely from India, yet no one can work remotely from across the country.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Most American cities were established based on a local resource: mining, hydro-power, farming, railroad junctions, or a harbor. So many northeast cities declined when the manufacturing tied to those resources moved on. The same thing with the midwest steel towns, and the further midwest railroad towns. Look at some of the boomtowns of the last 30 years. What local resources do most cities in Texas have, or Las Vegas, or Silicon Valley? They basically have nice climates, and the ability to quickly support a new population of people.
The American economy is much less based on manufacturing now, so the jobs can go anywhere. Even a large manufacturer no longer needs 5000 people working in one valley because the river provided the power, the mines provided the ore, and the railroad provided the transportation. They can move that factory to New Mexico because trucks and rail can bring it all in and out. The tech companies can go absolutely anywhere. The only resource they are tied to is the educated workforce, which I agree with the article is a self-manifesting destiny. Success brings more success, and the opposite happens at less fortunate cities.
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I think you greatly underestimate the value of creating large pools of talent in a single location. It is true that an individual can succeed on his own, working virtually in support of a company or himself. However, when you live in a community of similar talent, there's a sharpening effect - people coming together, sharing ideas, supporting one another, and ultimately, creating new businesses together. It's not impossible for this to happen virtually, but it is much easier when people are close to one another, able to do this informally whether over coffee, dinner, drink or just hanging out - essentially living life together. Proximity allows for much more rapid and deeper networking so that when those new ideas emerge, it's much easier to find and recruit the talent you need. Finally, when you have concentrated pools like this, you begin to develop secondary infrastructure that makes doing business in that area all that much more attractive - venture capital all the way down to better coffee.
I get you on the whole driverless car and hyperloop thing, but people really are very localized, and unless you can make both so fast that the thought of going to another city for drinks is no different a time and energy commitment than going to the bar a couple blocks away, it's not going to really work.
Funny, I live very remote and work from home 100% of the time. Yet I'm on phone, IM, online conferences with coworkers constantly. I don't feel the slightest bit out of touch.
Why does California have all the tech job? It is because non-compete clause are difficult to impose which allows talented individuals to roam around the industry. NAFTA took away the manufacturing jobs, but the high tech jobs are all still here, and they are concentrated in California mainly because of one piece of legislation: Edwards v. Arthur Andersen.
This divide — I will call it the Great Divergence — has its origins in the 1980s, when American cities started to be increasingly defined by their residents' levels of education.
Mandatory high school is great, but is not enough. College should be mandatory.
High school isn't mandatory. It is effectively required for many jobs, but not mandatory.
Frog-marching people through "education" isn't a solution. It is actually part of the problem. It used to be that only people who were motivated by a desire to be educated completed college. It is no surprise that such people went on to be successful.
The response has been to interpret a college degree as the cause of success. Thus, people who are motivated by the desire to make money go to college, regardless of their desire to be educated. This itself has perverted the market for education by raising the cost of pursuing the "investment" in future earning power. It has also crowded the education system with incurious people merely interested in credentials and job training.
My industry is 90% based in Los Angeles and New York. If I moved to a city in Mississippi, that would be fine for now, but if I lost that job I'd need to relocate, along with those costs.
Thus those cities never get a critical mass of jobs in my industry.
Poor schools are not the problem. Los Angeles and most of the Bay Area have horrible public schools in general. People either cherry pick the few quality independent school districts in expensive areas of town (like Beverly Hills) or send their kids to private schools.