Help Wanted (But Maybe Not Here)

Jonathan Lerner

Enrico Moretti’s new book about where knowledge industries cluster has implications for the economic future of all cities, and the future of their built environments.

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“It’s a cliché,” Berkeley architect and planner Peter Calthorpe once told me, “but a startup likes to go into a building with exposed brick walls.” The year was 1994; I was interviewing him about a redevelopment effort aimed at drawing high-tech ventures to a moribund industrial district in Chattanooga, Tennessee. Several years before Richard Florida’s The Rise of the Creative Class, apparently, it was already received wisdom that if you could only cool up your old urban neighborhoods—renovate their charming buildings, add some retro-chic infill and a double shot of espresso—you could attract the imaginative, enterprising risk-takers who would guarantee your city’s participation in the infotech economy of the future.

But maybe not. Chattanooga’s revived downtown is in pretty good shape. But nearly two decades on, the city doesn’t rate a mention in UC Berkeley economist Enrico Moretti’s book, The New Geography of Jobs. Moretti has a different take on what attracts the people and industries that can turn cities into “brain hubs” and make them the engines—and beneficiaries—of our post-industrial economy. It’s not the standard tactics municipalities use to goose up their economies, such as funding new stadiums, offering tax-breaks to relocating corporations, and expanding their airports. And it’s not cultural attributes like great universities and museums or urbane neighborhoods bustling with design shops and food trucks. In a word, it’s smarts. And in four words more, it’s “the forces of attraction.”

Moretti’s analysis is that innovation clusters arise in a location pretty much by accident. But once they become established, a self-reinforcing process attracts similar businesses, subsidiary industries that serve them, and the highly-educated and entrepreneurial people who make them run and expand.

Microsoft relocated in 1979 from Albuquerque to Seattle—then a declining industrial town bleeding its population. Bill Gates and Paul Allen just wanted to go back to where they’d grown up, Moretti explains. But Microsoft’s success seeded an innovation-industry community that has made Seattle one of the brainiest places in the country (measured by both college degrees and patents per capita) and one of the richest. It’s also one of the grooviest and, from an urbanist point of view, most livable—but those qualities, he says, are effects and not causes. Seattle is expensive, but high-tech workers are well-paid. And Moretti shows that both college educated and non-college educated workers earn more where there are knowledge-industry clusters. “The [earnings] ranking for industrial production managers is dominated by San Jose, Austin, Portland, San Francisco, Raleigh-Durham, and Seattle—all innovation hubs,” he notes, while pointing to similar correlations for barbers and cooks, lawyers and architects. “The workers aren’t different; what is different is the local economy that surrounds them—especially the number of skilled workers.”

Moretti sees a “Great Divergence” underway among American places based on whether or not they are centers of innovation and knowledge-based industry. His suggestions for encouraging still more such hubs to emerge, and for ensuring the global competitiveness of the U.S. as a whole, are to cultivate brain power: devote more resources to education, especially in math and science, and to research; drop restrictions on how many highly educated foreigners can work here. His concern is primarily the economic health of cities. But his outlook, if accurate, surely has implications for how their built environments may evolve. Anyone involved in the development of our metropolitan regions should consider his thesis, which is accessibly and enjoyably presented in his book.

For one thing, this perspective may indicate where there will be, and where there will not be, the kind of money it requires to undertake significant development and redevelopment. It also adds dimension to how we understand the well-established ‘back to the city’ trend and the current renaissance of many downtown areas. Intriguingly, the Congress for the New Urbanism recently held its 20th annual meeting, where a shift was articulated, away from the greenfield, new-town developments new urbanism is largely known for. In a video about visions for CNU’s future, several attendees speak of a new focus on second-tier, former industrial cities where street grids and other infrastructure, as well as reusable buildings, already exist. There’s an ample supply of such places, for sure.

But the brainiacs we picture working at the startup in a brick-walled loft aren’t choosing where to live based on geography or architecture or cool quotient, or even how cheap it is. They simply need to be where others like them are, because interaction fosters their creativity, and because that’s where the choice jobs exist. The chefs and hairdressers and therapists and designers who want them for clients want to be there, too, because they can pay more for services—and because, but only incidentally, the destination may become pretty cool.

So a critical factor in the calculation of urban renaissance may be cities’ relative degrees of involvement in the knowledge economy. Buffalo, Cincinnati and St. Louis, for example, have rich histories, enviable cultural institutions and restorable urban fabrics. But they may never attract enough innovators to generate economies that can transform decline into dynamism. Existing and emerging brain hubs, Moretti predicts, will continue to draw away the educated and motivated, leaving other places ever poorer in talent and money. These other cities will be less able to rebuild and sustain themselves—or only able to sustain themselves modestly in comparison to the knowledge-economy boomtowns. Disparities of income, education, health and general quality of life will become sharper between cities and regions. A lot of places will deteriorate. Only a few will be invigorated, with the benefits accruing not only to the biotech researchers and software architects who live in them, but to the realtors and waiters and carpenters who live there, too. Good job prospects for everyone, but only if you’re in the right place.