Top Metros are Harnessing STEAM Power

April 11, 2017

Full disclosure here, I initially started this analysis by asking which metros had the greatest share of adaptable jobs in traded sectors. By adaptable, I meant jobs that could transition and remain in demand in any foreseeable economic future, particularly a future that automates jobs into oblivion. By traded, I am looking at occupations that are usually in industries a region can specialize in and trade.

Going down the list of all occupations I identified 130 occupations that I thought met the criteria of adaptable and tradable. These were occupations like scientist, I.T. professionals, and engineers, which is pretty much the definition of STEM jobs. I also added occupations in the creative design (Arts) which brings us to STEAM (Science, Technology, Engineering, Arts, Math).

In hindsight, I should have just started with STEAM, but I thought it was informative that a separate search for adaptability and tradability brought me back to STEAM.

Healthcare and education are generally regarded as occupations safe from automation. Technology is a big part of both these fields, but ultimately, we want a real person operating on us or teaching our kindergarteners. These are important jobs, but they generally serve the local market and, therefore, are not the traded jobs we were looking for.

 

Who is Running on STEAM?

In the 107 metros with a population of 500,000 or more, STEAM occupations account for 9 percent of the total jobs. The range is large, from a low of 2 percent in McAllen, TX to 27 percent in San Jose, CA.

Growth in STEAM

STEAM Powering the Economy

Not only are the high-STEAM metros better prepared to adapt to a future economy that is more automated, they are more productive. The chart below shows a strong correlation between the share of STEAM jobs and economic output (GDP) per capita in large US metros (those with a population of at least 500,000). Of all the metros where less than 5 percent of the jobs are STEAM jobs, none have a per-capita GDP greater than $40,000. On the other end of the spectrum, none of the 5 metros that have at least 15 percent of their jobs in STEAM has a per-capita GDP lower than $70,000. These top 5 metros (San Jose, D.C., San Francisco, Durham-Chapel Hill, Seattle) are no surprise when you consider their strong I.T. sectors.

This productivity is rewarded. On average, STEAM occupations pay 83 percent more than the overall wage ($88,568 to $48,320).

 

Cultivating STEAM

The pervasive nature of STEAM makes it challenging from an economic development perspective. There is not really a “STEAM industry” to focus on. STEAM is more a level of skills that are in demand in all industries. It is helpful for metros to stop looking at STEAM as a unique, highly coveted, grouping of jobs, but instead as a trait that makes their entire economy more sustainable and efficient.

So, how can metros encourage STEAM in their economies? It starts (as it so often does) with education. A healthy relationship between education and business is vital to building a pipeline of STEAM talent. Business has to be able to discuss their changing demands for workforce talent, and educators need to be able to quickly adjust to meet those demands. It is important to note these changing demands don’t always mean more high level college degrees. Many of these STEAM jobs do not require a bachelors or graduate degree to get started. A more successful model might be having an adaptable education infrastructure where students can quickly pick up a key credential that shows they have acquired an in-demand skill. This education infrastructure will remain a part of this student’s career because they will need to stay plugged in to keep up with the latest trends.

Metros can also try to solve the gender/race problem in STEAM. Despite high demand and high pay, STEAM jobs have not been able to attract women and minorities into the field in representative numbers. Several studies show that women hold less than 25 percent of all STEAM jobs. African Americans and Hispanics hold less than 20 percent.

Metros can also think global to boost their STEAM profile. In 2016, there were over 600,000 H1B petitions filed as U.S. businesses look globally to fill key positions. The clear majority of these jobs are STEAM jobs. However, politics has recently cast some doubt on the H1B program. Metros may have to get political to make sure this talent pipeline keeps flowing.

Finally, quality of life still matters for STEAM jobs. As already mentioned, STEAM is pervasive. Perhaps more than most other job categories, STEAM jobs can be done anywhere, often remotely. STEAM workers are not going to be limited to certain markets where the STEAM industry is strongest. These workers can afford to choose the region where they want to live first, and then consider exactly what job to take second. Given this, it may be that recreational and cultural investment may prove to be as important as more technical and educational investments.

Pursuring a STEAM strategy is clearly a big commitment, but it a vital one if we want our local economies to be able to remain strong in this changing, STEAM powered, economy.

The STEAM data by metro can be found here.

 

 

 

 

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