Friday, November 16, 2018

Tech firms' decision to put big facilities on East Coast show another kind of increasing rural-urban divide: economic

Decisions by and Google "to add tens of thousands of jobs to New York and the Washington area reflect a growing divide in the U.S.," Shayndi Raice and Janet Adamy report for The Wall Street Journal. "Smaller cities are also pulling in educated workers, but are having trouble competing for the nation’s most prized jobs and biggest projects, while rural areas are falling behind."

In the last 10 years, cities have seen their employment grow 7 percent and the number of businesses establishments go up 11 percent, "while employment has contracted in non-metro areas and the number of businesses there has barely changed, according to Labor Department data," the Journal reports. "Big shifts in how people work and live over the past generation are behind the change. As global competition dried up manufacturing jobs in small towns, the U.S. became more dependent on the growth of knowledge and service jobs that tend to proliferate in dense places."

The hope of many rural economic developers was that the internet would allow people to work from anywhere, and experts thought "tech workers would scatter across the country as firms sought cheap office space," the Journal notes. "Instead, places like Silicon Valley and Seattle proved that clusters of highly skilled workers fueled innovation at a faster pace." Also, the lack of high-speed broadband in many places has limited the ability of some small towns to capitalize on the internet economy. But the Journal story is mainly about how medium-metro cities like Indianapolis, Nashville and Pittsburgh couldn't compete with New York and Washington.

The coastal cities "are also becoming wealthier, more liberal and more ethnically diverse—shifting the economic, political and cultural landscape of the nation," Raice and Adamy write. "College-educated workers are increasingly moving to the Democratic Party." That “could exacerbate the urban-rural divide; there’s no question,” Karlyn Bowman, senior fellow at the conservative American Enterprise Institute, told the Journal.

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