Pittsburgh's tech sector has emerged as a key industry to watch in the region, but it faces a problem — it isn't retaining talent.
Not only does Pittsburgh generate more tech talent than jobs, but the region is losing them — the sector lost approximately 4,000 jobs last year. The city is home to office spaces of several of the world's largest tech companies, including Google, Meta, Microsoft and Apple, but these office spaces are primarily in the fields of research and development.
"All of them are kind of R&D based, they're really tapping into the bright technical minds that we have here, but the common analysis the is that there's no decision-making authority figure for any of those companies that are actually in Pittsburgh," Lance Lindauer, the executive director of the Partnership to Advance Responsible Technology, a local nonprofit think tank, said."If you even wanted them to get deeper and invest more into the area you don't have that actual person, they're sitting in Boston or New York City."
Having more people with "the power of the purse" could help the region garner more investment and attention.
Not to say that the region hasn't garnered investment and attention — the local tech sector received a near record $3.12 billion in investments last year. But only 2% of that money came from inside the region, something that affects early stage startups. A successful startup can create large numbers of jobs, for example, Duolingo was founded by two people and now employs 430 people in the region.
But Lindauer said that the region has had problems being able to "bridge [startups] from a seed round to an A round," and that because early stage investing is primarily garnered from networking, some may look elsewhere to start companies.
"We've had a lot of companies raise a lot of money from outside sources, but most of those companies got their start, before they could raise the money, in Pittsburgh," Jay Katarincic, managing director at Magarac Venture Partners, a local early stage investment firm, said. "You've got to have the money to get off of the ground before you can go raise."
Magarac moved to Baker chose to move to Bakery Square last year to be closer to the growing artificial intelligence presence in the development, which has been billed as AI Avenue.
"We knew there would be benefits from being close to Carnegie Mellon and being close to UPMC and Google, but we didn't understand and we didn't appreciate the natural networking that goes on here," Katarincic said. "There's not a day that we don't need something, bump into someone, or do something that not only helps our businesses but helps rise the tide of the tech and particularly the AI world that is being built here."
Developers Walnut Capital have pushed considerably to bring AI companies to the sector.
"We had Google here and they're number one in AI, and that's what their main focus is here," Walnut Capital CEO Gregg Perelman said. "We started attracting companies that wanted to be around Google and be in this ecosystem where we have Duolingo people down the street and Carnegie Mellon here."
Perelman said that the design and offerings of Bakery Square has helped attract tech talent to sign leases. In addition to the restaurants and shopping, he said that more tech focused amenities, such as adding a network of electric vehicle chargers, had made the space more attractive to perspective tenants.
Lindauer said that the city's broader amenities and cultural offerings will impact the city's availability to attract young talent.
"If we're losing in the cool conversation then we're just not going to land young families and young talent and students are going to flock to different markets," Lindauer said.
