Kansas City moved up two spots this year in CBRE’s annual Scoring Tech Talent report, which ranks the top 50 North American tech markets.
The metro ranked No. 30 overall and was evaluated on 13 metrics, such as tech graduation rates, tech job concentration, tech labor pool size, and labor and real estate costs. The San Francisco Bay Area took the No. 1 spot, followed by Seattle, Washington, D.C., Toronto and the New York City metro.
During the pandemic last year, tech jobs in the U.S. grew 0.8%, compared with non-tech occupations, which declined 5.5%. The hottest tech roles were software developers and programmers, which accounted for 85,000 new jobs last year in the U.S. – a 4.8% increase from 2019.
With 52,630 tech employees, the Kansas City market has the 29th largest tech talent labor pool in the U.S. It’s also among the most affordable markets for tech companies, ranking No. 11.
CBRE used the scenario of a 500-employee company leasing a 75,000-square-foot office to compare costs among the markets. In addition to rent cost, it also took into account tech talent wages, non-tech talent wages and management wages. In Kansas City, the total annual cost is $40.1 million. The cheapest is the Waterloo region, $31.3 million. Examples of other market costs are: Austin, $45.6 million; Denver, $51.4 million; San Francisco Bay Area, $68.6 million; and Chicago, $46.5 million.
“The tech industry has shown its adaptability across the U.S. during Covid-19 and Kansas City has been no exception,” Brian Bacon, CBRE first vice president in Kansas City, said in a release. “There are several factors to this, including Kansas City’s low operating costs for tech companies, low cost of living for tech employees, our strong Midwest work ethic culture and the growing millennial population within the city. As a result, Kansas City has grown into becoming one of the largest large tech talent markets.”
In the Kansas City market, tech workers comprise 5.1% of the overall workforce and their average salary is $86,770, a 6% rise since 2015. St. Louis has slightly more tech workers at 55,080, but they comprise 4.2% of the overall workforce. In San Francisco, its 373,430 tech workers comprise 10.9% of the overall workforce.
Another key metric is the millennial population, which has bolstered the growth of tech talent in all 50 markets and has contributed to the revitalization of downtown neighborhoods, according to the report. Since 2014, the Kansas City market has seen its millennial population rise by 53,932 people, a 12.5% increase. The growth rate puts Kansas City at No. 16 among the other markets.
Like other markets, Kansas City must continue to diversify its tech workforce, according to a recent KC Tech Specs report from the KC Tech Council. The metro's tech industry falls into the third quartile of the diversity index, which looks at the quantity and distribution of race and ethnicity in the workforce. Black employees comprise just 7% of the region’s tech workforce, followed by 4% Hispanic. Women account for 26% of the local tech workforce.
According to the report, 35% of an employee’s emotional investment in their work and 20% of their desire to stay at their company is tied to feelings of inclusion. To help area employers diversify their workforce, the KC Tech Council teamed up with tech apprenticeship program, Apprenti, which puts an emphasis of connecting with communities that are underrepresented in the tech industry.
