The Philadelphia area has lost close to 10,000 tech jobs in the past five years, according to a new report from CBRE, making it harder for the region to retain local tech students after graduation.
The Philadelphia market ranks No. 24 in North America and No. 18 in the U.S. on the 2024 Scoring Tech Talent Report from the Dallas commercial real estate firm. Both rankings are down two spots from last year.
From 2022 to 2023, the Philadelphia market shed 2,700 tech jobs, or about 2.3%, with tech employment shrinking from 108,630 to 105,930, according to CBRE. From 2018 to 2023, the drop was steeper, with the number of local tech positions shrinking by 8.5%, or 9,870 jobs.
The decrease in jobs came as Philadelphia-area colleges and universities added 31,542 graduates with tech degrees to the workforce between 2018 and 2022, leaving fewer opportunities for locally produced talent to find employment in the region.
Among large tech markets, only Chicago had a larger loss in tech jobs from 2018 to 2023 at 9.5%. On the East Coast, Washington, D.C., lost 6.8% of its jobs and Baltimore’s tech workforce shrank by 6.1%. Meanwhile, New York added 6.1% more tech workers and Boston grew by 1.5%.
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Despite the softening of hiring in the tech workforce, the region was a magnet for new young professionals. Greater Philadelphia saw a 13.3% increase in residents in their 20s with college degrees from 2017 from 2022, and a 23.6% increase of residents in their 30s with college degrees, according to U.S. Census Bureau data cited in the CBRE report.
Diversity is also a strong suit in Philadelphia, the report shows. Underrepresented groups account for 26.5% of the tech workforce, a greater share than in other white collar jobs across the region. It makes Philadelphia the third-most diverse large tech talent market in North America.
Another area that continues to be an asset for Philadelphia is the relative affordability of rent, both for tech employees and their employers. Both its average annual office asking rent of $33.46 per square foot and its average monthly apartment rent of $1,844 per month are the 13th most expensive in North America, according to CBRE.
“Philadelphia’s strong educational institutions and favorable cost of living helped the region score favorably in a tech talent quality vs. cost analysis, allowing the city to maintain its reputation as a key player in the tech market despite a small fall-off in hiring," said Scott Miller, an executive vice president for CBRE based in Philadelphia.
Philadelphia's rent-to-tech-wage ratio is about 1 to 5, with average annualized apartment rent totaling $22,129 and the average annual tech wage at $114,320 as of 2023. The average tech talent wage grew 20% over the past five years.
