Where to Move if You Want a Tech Job

The San Francisco Bay Area is one of eight major metros accounting for a significant share of America's tech openings, according to new data. (GETTY IMAGES)

Through the first half of 2017, more than a quarter of America's job openings in tech were located in just eight major metropolitan areas, according to new research that also suggests the bulk of the industry's highest-paying jobs are consolidating around just a handful of cities across the country.

Jed Kolko, chief economist at employment hub Indeed, on Tuesday unveiled new research digging into tech employment in America. It showed just eight metro areas – those centered around San Jose, California; the District of Columbia; Baltimore; Seattle; Raleigh, North Carolina; San Francisco; Austin, Texas; and Boston – accounted for 27 percent of all tech job postings during the first half of the year.

Comparatively, that same group accounted for just 13 percent of all job postings across the country. Yet in some sense, Kolko indicated, that tech-heavy concentration is unsurprising, given the same cities accounted for 26.5 percent of tech job openings back in 2013.

"In other words, there hasn't been a broad shift of technology jobs away from these hubs toward the rest of the country," he said in a Tuesday blog post. "Furthermore, the metros in the top eight have been almost unchanged over the past five years."

What is notable, however, is the apparent migration away from Silicon Valley and the San Francisco Bay Area. Kolko notes both "had smaller shares of U.S. tech job openings in the first half of 2017," and that "Seattle is gaining share in tech job openings the most, followed by Washington and Baltimore." Kolko believes it's "no coincidence" both the San Jose – meaning Silicon Valley – and San Francisco areas also have the steepest costs of living among the tech hubs.

Also of note: Higher-paying and faster-growing tech jobs are increasingly situated in these eight major metro regions, while lower-paying jobs are dispersing elsewhere.

For example, nearly three-quarters of technical staff member job openings – which come with a $103,624 annual median salary, according to PayScale – were located in the Big Eight tech hubs, according to Indeed's research. And 66 percent of both machine learning engineer and computer vision engineer openings – which carry median annual salaries of $106,817 and $99,329, respectively – emanated from this small collection of areas.

"We divided the 158 tech-job titles into three categories based on their estimated national average salaries on Indeed: higher-salary jobs ($100,000 or more), middle-salary jobs ($75,000-$100,000) and lower-salary jobs ($75,000 or less)," Kolko said. "In the first half of 2017, the eight tech hubs had 39 percent of the higher-salary tech jobs, 27 percent of the middle-salary jobs and 21 percent of the lower-salary jobs."

In all, the eight regions accounted for less than 10 percent of America's total base of employees as of May 2016, according to the Bureau of Labor Statistics.

"Although the overall share of tech jobs in hub metros has been essentially flat from 2013 to 2017, higher-salary tech jobs have become more concentrated in top-tier tech centers over the past year, while lower-salary tech jobs have dispersed a bit," Kolko said. "In other words, tech hubs are keeping their grip where it really counts – on higher-salary tech jobs. Only lower-salary jobs are dispersing."

What that leads to, he said, is an increasingly polarized industry "as places become increasingly different from each other,' following similar patterns "in incomes, politics and housing." More than half of the tech job postings in Silicon Valley, the San Francisco Bay Area and the Seattle metro region during the first half of 2017 were for "higher-salary job titles." Only 29 percent of openings in the Baltimore area and 31 percent in the national capital region were for similar positions. No other tech hub managed to eclipse 40 percent.

he Seattle, San Francisco and Silicon Valley areas have attracted some of the country's – and the world's – most valuable tech companies, from Amazon to Facebook to Google. So it's little surprise the broader tech industry has increasingly built up around some of its biggest leaders in innovation.

But with housing costs soaring in many of the hubs profiled in the report – first-quarter median sale prices this year grew at an annual rate of at least 6 percent in every Big Eight tech hub except Washington and Baltimore, according to the National Association of Realtors – some workers have begun to look outside the most well-known and traditional tech areas to find work.

"Outside the eight tech hubs, Boulder, Colorado; San Diego; and Provo-Orem, Utah, are also gaining share and have tech-job mixes that look like Silicon Valley's," Kolko said. "For tech workers looking for alternatives to the Bay Area – places where the pace is a bit slower and the homes a bit cheaper – Seattle, Boulder, San Diego, and Provo are where their specialized skills are increasingly in demand."