The Great Separation Pt. 3: Competing for an Educated Workforce
In our previous posts we have discussed the Great Separation where the economies of the largest U.S. metros are diverging and growing at very different rates. We discussed how these metros are always looking for talent (a high skilled workforce) to grow the new idea-based economy. In this post we will look at how these metros are doing in supplying this talent.
The chart below shows the difference in educational attainment among our six groups. The first group, the Great 8, consisting of Austin, Dallas-Ft. Worth, Denver, Los Angeles, Nashville, San Francisco, San Jose, and Seattle have the highest level of attainment with 39.3 percent of adults having at least a bachelor’s degree.
There is a lot of variance within this group however. San Jose and San Francisco have very high levels of educational attainment (45.5 percent and 43.4 percent respectively) while Dallas (31.1%), Los Angeles (31%) and Nashville (29.7%) have much more modest levels.
Overall, the higher performing metros have higher levels of education with the Great 8 at nearly 40 percent and the Need Traction group at 31.3 percent. The groups do not exactly stairstep down however. The Up-and Comers and Waking Giants group is made up of some former manufacturing centers (Cleveland, Columbus, Grand Rapids and Pittsburgh) that had lower levels of educational attainment because most manufacturing jobs did not require a post-secondary degree.
However, as the chart below shows, this group has seen a strong increase in the share of adults with at least a bachelor’s degree between 2010 and 2017. The Up-and Comers and Waking Giants group saw their educational attainment percent rise from 29.7 percent in 2010 to 34.1 percent in 2017. This increase of 4.4 percentage points is tied with the Great 8.
Brain Drain or Brain Gain
We can get another view of a metros ability to attract and retain educated workers by looking at migration patterns of adults with at least a bachelor’s degree. All metros see people move in and move out in a given year. The difference between these figures (moved in minus moved out) gives us the net in-migration. The interactive map below shows the net in-migration of adults with at least a bachelor’s degree. The dark blue metros saw the strongest net inflow (brain gain) while the darkest red saw strong outflow (brain drain).
Phoenix had the biggest brain gain between 2016 and 2017. The Valley of the Sun had 27,000 adults with a bachelor’s degree leave the area, but over 45,000 moved in, for a net inflow of over 18,000. We should note that we cannot determine if those moving in are joining the workforce or perhaps retiring, as many people go to Phoenix to do. With Tampa-St. Petersburg (another big retirement destination) ranking 6th on our list, it does suggest that educated adults who are retiring are a significant part of some metro’s migration figures. Dallas, Denver, Charlotte and Seattle round out the top 5. All four of those metros are in our top two performing groups (The Great 8 and Stalwarts).
Missing from the top of the list were our high-tech metros in the Bay Area. San Francisco and San Jose had modest net domestic migration inflows. However, these metros do quite well finding talent from another source, the rest of the world. The Bay Area is a magnet for international talent and their net domestic migration figures pale in comparison to their international inflow of educated workers.
The Census Bureau doesn’t give us international outflow so we cannot get a net international migration, just the inflow side. So, as the map below shows, every metro has some inflow of adults with at least a bachelor’s degree from international destinations. The largest metros (New York, Los Angeles, Miami, Washington D.C.) tend to draw the highest number of educated international immigrants.
One more item to consider, in this post we are equating a talented workforce with a highly educated workforce (specifically, those with a bachelor's degree). Degrees are a good proxy for workforce talent, but it does not tell the whole story. More than ever, the economy is filled with a wide variety of jobs. Some require post-secondary degrees, some don't. But, in this changing economy, one thing all jobs will require is almost constant re-training in order for workers to stay up to date. All metros, especially those with lower levels of educational attainment can become more economically competitive by working to foster communication between their business and education communities. Internships can help school-aged children think about careers available in their city and what it will take to get started in such a career. Local colleges (both 4-year and community colleges) can work to expedite new certificate and degree programs that align with needs of the local business community.
Talent comes in all shapes and sizes. The regions that know this and work to grow talent will gain a competitive edge in this changing economy.
Next up, we will look at the workforce and see what jobs are driving the separation in our metro growth rates.
The data for the charts and maps can be found here.