Are These 15 Cities the Future?
POLITICO Magazine’s Glenn Thrush is out with a great report out on Pittsburgh’s economic renaissance. He finds that “Pittsburgh, after decades of trying to remake itself, today really does have a new economy, rooted in the city’s rapidly growing robotic, artificial intelligence, health technology, advanced manufacturing and software industries.”
How did this happen? Thrush comes to a simple conclusion: Pittsburgh’s recovery was based in its large stock of human capital. Even as the city’s economy suffered from a transition out of heavy industry, its base of educated, skilled workers helped Pittsburgh retool for new opportunities. This shouldn’t be surprising. Studies show that for every 10% increase in the number of a city’s college graduates, GDP over time goes up by 22% and employment by 0.8% thanks to rising productivity.
That got me thinking: are there cities today, like Pittsburgh once, that have lots of human capital but poor economies? My bet is that those places will likely see significant growth over a generation. Can we see which cities have a base of skilled workers to capitalize on?
It’s actually pretty easy to find out these future growth cities. Human capital is usually measured by the share of population with bachelor’s degrees, while prosperity is judged by real per capita GDP. By ranking 100 of America’s most populous metros along these measures, we can then see which cities have the greatest difference in ranking between human capital and economic performance.
Sources: BEA, Brookings’ Metropolitan Policy Program
You’ll see on the resulting list a surprising mix of cities. There are more that could be featured, but the top 15 give you a representative snapshot. Some are like Pittsburgh: former industrial leaders that now find themselves transitioning to a new economy. Others are known for a recent influx of STEM workers, such as Provo, UT.
The point isn’t to say these cities are future boomtowns, though for some that may become true. Rather, they are cities of opportunity. The potential to bring greater economic growth is already there, resting in their people.