Urbanism and the Economics of Fatal Talent Attraction
Attract talent or die. That's the one imperative of the zero-sum Creative Class game. Another run at Cool Cities in Michigan:
David Egner, president of the Hudson-Webber Foundation and executive director of the of the New Economy Initiative for Southeast Michigan, said the suburbs will benefit from a more vibrant Detroit, if the city can attract more young college grads. …
… "If we don't have a strong urban core, we won't have the young talent that will move to the suburbs when they have children, and the financial distress will continue," Egner said.
"We've been fighting the wrong battle," he said. "It's not about Detroit versus the suburbs. It's about Detroit versus Chicago."
It's also about Detroit versus San Antonio, Portland, Seattle, Pittsburgh, Milwaukee, Grand Rapids, and Las Vegas. More and more places are competing for the young and college educated, which will bid up the price for that demographic cohort. How can Detroit outshine the giants of Silicon Valley in this war for talent? It can't.
As usual, Detroit and Michigan are a few steps behind in economic development. About three years ago, an alarm bell was sounded in Silicon Valley:
Fully 60 percent of the Valley's science and engineering workforce was born outside of the United States, mostly from India, China, and Korea, according to the Index.
But "some who have lived and worked here for years are beginning to 'go home,'" observes Tom Friel, retired board chair of the executive search firm Heidrick & Struggles.
"This is a troubling trend, exacerbated by our dysfunctional national immigration policy agenda, and if not addressed will have significant negative impact on our future as a region."
In addition, the percentage of foreign-born students earning science and engineering degrees in Silicon Valley has declined since 2003, dropping from 18 percent to 16.6 percent in 2007. The influx was hit first by tightened restrictions under Homeland Security after Sept. 11, Hancock said.
Friel stressed the importance of supporting education and training for the local population, "natural and immigrant alike," and doing whatever possible to keep the region attractive to talent from around the world.
At the same time, he said, "I don't think it's realistic or healthy to continue to rely on such a large inflow of engineering and science talent from abroad, particularly from Asia. This inflow has been the source of much of the Valley's historic edge in innovation, but conditions for these immigrants, support for their education, financing for their business ideas, have improved in their home countries and declined here."
Even as attracting and retaining top talent remains important to the region, California's investment in higher education is declining. While the total number of science and engineering degrees has leveled off, the percentage conferred to foreign students has been sliding in both the state and nation as a whole, the report notes.
I call this concern the "end of migration." Opportunities are popping up in source communities and countries. From whence they came, they return. The focus shifts from talent attraction to talent production. Top-tier research universities matter more than a vibrant urban core. I think that's the pickle that Portland, Oregon finds itself in. Meanwhile, Silicon Valley reiterates the looming crisis:
Alan Berube, a researcher with the D.C.-based Brookings Institution, detailed his findings on the dearth of Science, Technology, Engineering, and Mathematics (STEM) talent in the region during the event.
"I'm actually a Silicon Valley STEM product myself," said Berube, who holds a Stanford degree in chemical engineering. Despite his personal experience and the fact that Silicon Valley "looks good on paper," he said sustainable growth will only come with an adequate supply of labor.
"Human capital is sticky, and that's really what drives economic growth in a region over the long term," Berube said. "Silicon Valley relies on a lot of in-migration."
Emphasis added. Berube isn't offering a compliment. He's describing a problem. He's also describing Pittsburgh's competitive advantage. Pittsburgh couldn't rely on in-migration. Whatever the local workforce needs, the local colleges and universities met them. Today, companies such as Google and Disney move to Pittsburgh to be near the talent source. Instead of trying to be the next Silicon Valley or Portland, Detroit should aim to be the next Pittsburgh.