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Jones Lang LaSalle research has tracked this first uptick in growth since 2001 to specific tech-friendly cities, driven by regionalization and automation
SAN FRANCISCO, May 29, 2013 – New research by Jones Lang LaSalle has tracked the first increase in technology manufacturing U.S. job growth since 2001. The report equated the growth to cities with a high concentration of highly-educated technology workers. The research, Perspectives on Technology Manufacturing states that access to specialized expertise has started to outweigh the costs of real estate and labor as a site selection factor. JLL says that technology operations that are locating in the U.S. are driven by a series of factors:
Together, these factors mean that highly automated technology manufacturing facilities are now opening in the U.S. with a need for proximity to highly skilled labor—also best located near tech-savvy workforce clusters. And, though the U.S. represents just 5 percent of the world’s population, the country employs a third of global high-tech researchers and accounts for 40 percent of high-tech R&D, according to economist Richard Freeman.
“This regionalization of high tech manufacturing trend is characterized by the creation of jobs requiring strong technological skills – think engineers on production lines – as opposed to re-shoring where similar job functions are imported back to the United States from overseas,” said Greg Matter, Vice President at Jones Lang LaSalle. “Having access to this talent is one of the reasons that manufacturing facilities for technology firms are often located in tier one locations where labor and real estate are generally more expensive.”
Hot Markets for High-Tech Manufacturing JobsHigh-tech manufacturing firms are looking to locate in clusters close to skilled talent, suppliers and customers, especially for business-to-business interchanges. As a result, in 2010, about 79 percent of moderately high-tech manufacturing jobs, and 95 percent of very high-tech manufacturing jobs, were located in the 100 largest American metropolitan areas. Lower-level technology jobs are most concentrated in the southern states, while over a third of the most high-hech positions reside in companies on the West Coast.
The research indicates that between 2012 and 2018, high-tech manufacturing jobs are expected to proliferate further in California’s Silicon Valley –an even tighter real estate market as tech companies look for industrial space in addition to expanding their need for traditional office space as they grow.
Concentration of High-Tech Manufacturing
Another attractive market is Austin, Texas, already a mushrooming technology hub, now also becoming a magnet for high-tech manufacturing growth. The area is well-known as a tech hub, and offers a well-established presence of manufacturing and R&D operations in the metro area that take advantage of the thousands of graduates in engineering and computer science the University of Texas generates each year. An annual survey by Forbes ranked Austin among the top five U.S. cities for job prospects in 2013.
Additional high-tech opportunities are located in Los Angeles, CA; Binghamton, New York; Portland, Oregon; Boulder, Colorado; Phoenix, Arizona; Boston, Massachusetts and Boise, Idaho. A second tier of smaller but growing high-tech clusters are scattered across the U.S., but expanding most rapidly in the southeastern states where companies are taking advantage of the low cost of living and less expensive, yet skilled, labor force. Other North American cities will also compete with American hubs as important technology manufacturing centers, such as Toronto to the north and Guadalajara, Juarez and Tijuana to the south. About Jones Lang LaSalle Jones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $47.7 billion of real estate assets under management. For further information, visit www.jll.com.
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