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Economy

The Benefits of High-Tech Job Growth Don’t Trickle Down

A new study from the U.K. finds that although high-tech and digital industries spur job growth, less-skilled workers don’t even get spillover benefits.
Facebook's headquarters in London.
Facebook's headquarters in London.Toby Melville/Reuters

Cities around the United States and the world see high-tech industries as a key source of economic advantage: Look no further than the incredible time, expense, and effort more than 200 cities put into competing for Amazon’s HQ2. Urban leaders know that, not only are jobs in technology good jobs, they also spur the creation of lots of follow-on jobs. In The New Geography of Jobs, economist Enrico Moretti argues that every high-tech job has a multiplier effect of an additional five jobs, spurring a virtuous cycle of economic development and employment growth.

Yet it is increasingly evident that major tech hubs (San Francisco, Boston, Seattle) and superstar cities with large high-tech industries like New York and London have become more and more unequal, especially with their high housing costs eating away at the incomes of blue-collar and service workers.