HOUSTON – (By Kyle Hagerty for Realty News Report) – Tech jobs, a primary driver of office space use in the 21st century, are fueling some of the nation’s hottest office markets. A new report from commercial real estate industry giant CBRE shows that Houston, the largest city in the Lone Star State, long playing catchup to Austin and Dallas, is only falling further behind.
As one of the premier locations for tech talent, Austin ranked sixth in CBRE’s Tech Talent Scorecard, registering 72,360 tech jobs in a city with less than a million residents, 7% of its overall labor force. That’s almost double the tech talent labor concentration level in New York City. It follows that Austin has an unusually high-level development capacity for new commercial office space, totaling 25,860,323 square feet planned or proposed in the area.
While Dallas may have larger tech force, with a much larger population across the metropolitan area, the numbers break down differently. Roughly 169,290 Dallas/Fort Worth -area residents are employed in the tech industry, accounting for just over 4% of the overall workforce, earning Dallas the 11th spot of CBRE’s Tech Talent Scored.
At 34 on the list, Houston, with 95,640 tech jobs representing just 3% of the overall workforce, has some catching up to do. The problem is Austin and Dallas keep getting further ahead. In Austin, tech jobs are growing at a 12.6% rate. Dallas is growing at an even faster 15.7% rate. Tech job growth in Houston is 3.1%, putting the Bayou City in a bigger hole each passing year as the mass of tech jobs in DFW and Austin attract even more tech jobs, accelerating tech job growth to a rate Houston can’t keep up with.
“Demand from tech companies shows no sign of slowing and we are now seeing employers with a large tech workforce targeting submarkets outside traditional Austin tech hubs, such as east and south, in addition to continued demand in Austin’s Central Business District,” said Erin Morales, Senior Vice President at CBRE in Austin and member of the firm’s Tech and Media Practice.
Houston’s isn’t taking the news lying down. In an effort to create the type of dense atmosphere that attracts tech talent, the City of Houston is working with stakeholders like Rice University and the Texas Medical Center on an Innovation Corridor surrounding the former Midtown Sears, dubbed The Ion. Efforts from tech-focused initiatives like the now defunct Houston Technology Center, Houston Exponential, and the Mayor’s Technology and Innovation Task Force have yet to yield the type of results city leaders hoped.
Before Houston can hope to catch up, it will need to keep pace.