Vibrant central cities, universities key to attracting and retaining talent
Pittsburgh is viewed by many as Exhibit A for how so-called Rust Belt regions can return to prosperity. The basic recipe: make the transition from a factory-driven to a knowledge-driven economy largely by retaining and attracting talent.
The New York Times — in the Fashion and Style section of all places — provides an update on the Pittsburgh renaissance in an article entitled “Pittsburgh Gets a Tech Makeover.” It writes:
“In a 2014 article in The Pittsburgh Post-Gazette, Mayor Bill Peduto compared Carnegie Mellon, along with the University of Pittsburgh, to the iron ore factories that made this city an industrial power in the 19th century. The schools are the local resource ‘churning out that talent’ from which the city is fueled. Because of the top students and research professors at Carnegie Mellon, tech companies like Apple, Facebook, Google and Uber have opened offices here.”
What a difference retaining and attracting talent makes! Richard Florida has explained the genesis of his writing “The Rise of the Creative Class” was his experience living in Pittsburgh and working at Carnegie Mellon in the 1990s. Florida observed Carnegie Mellon was quite successful in commercializing technology breakthroughs. But once those new companies started to scale, they moved to places like Boston because of the shortage of talent in metro Pittsburgh.
Florida’s groundbreaking insight was that businesses were moving to where talent is concentrated rather than people moving to where the jobs are. Talent had become the driver of economic growth and prosperity, not being business friendly. This is even truer today than in 2002 when the book was published.
Pittsburgh’s renaissance is driven in large part by transitioning from an exporter of talent — particularly young professionals — to an importer of talent. Once a place where talent went to college and then left, it now is a place where more and more graduates stay after college, as well as a place that attracts talent from elsewhere. That is the story the Times tells in its article.
45.5 percent of metro Pittsburgh’s 25- to 34-year-olds have a four-year degree or more. Michigan’s two big metros? Metro Detroit is at 32.6 percent, metro Grand Rapids 35.9 percent. Maybe more telling is metro Pittsburgh’s share of young professionals nationally compared to its share nationally of the total population is 126 percent. Its population is overconcentrated in young professionals. Metro Detroit is 86 percent; it’s under concentrated in young professionals. Grand Rapids is 107 percent, just above an even share.
Minneapolis is the Great Lakes’ most prosperous metropolitan area; 46.6 percent of its 25- to 34-year-olds have a four-year degree or more. Metro Minneapolis’s share of young professionals nationally compared to its share nationally of the total population is 147 percent.
The evidence from around the country is that quality of place is an — if not the most — important component in retaining and attracting talent. Places with quality infrastructure, basic services and amenities are the places that retain and attract talent the best.
One might ask, “What does quality of place have to do with economic prosperity?” The answer is talent is mobile and increasingly where the high-wage knowledge-based enterprises follow. In a Financial Times column, former New York Mayor Michael Bloomberg got it right when he wrote: “I have long believed that talent attracts capital far more effectively and consistently than capital attracts talent.”
The places where talent is concentrating are increasingly big metros with vibrant central cities — central cities because mobile talent increasingly wants to live in high-density, high-amenity neighborhoods where you don’t have to own a car. Every high-prosperity state that is not energy driven has an even higher prosperity big metropolitan area that has a high proportion of residents with a four-year degree or more. And those big metropolitan areas are anchored by a vibrant central city that is a magnet for young talent.
Michigan won’t be a high-prosperity state again until and unless metro Detroit and metro Grand Rapids are able to compete with national talent magnets like Chicago and Minneapolis for mobile talent.
Along with quality of place, Pittsburgh and Minneapolis remind us that universities — particularly research universities — are a tremendous asset in building a high-prosperity knowledge-based economy.
It’s far past time Michigan political and business leadership move away from a turn-back-the-clock economic growth strategy to one based on an understanding that vibrant central cities and universities are essential assets in restoring Michigan to high prosperity.
Lou Glazer is president of Michigan Future Inc.