Top of the News: Seattle rightly agonizes over the loss of much of its working class — after all, this was once a blue-collar town with abundant jobs connected with railroads, fishing, logging, manufacturing and a low-tech port. Yet it’s part of a much larger trend in America.
Richard Florida discusses the rise of “means metros” in an article on McKinsey & Co.’s blog. These are the urban areas that in recent decades have gathered a disproportionate share of America’s most talented workers. Seattle is among this elite few.
“It’s not just that people prefer to live in means metros,” he writes. “To be sure, many of them are aesthetically pleasing–beautiful, energizing, and fun to live in–but they can also be cramped, dense, and expensive.”
Florida continues, “There is a deeper, more fundamental reason, rooted in economics. Increasingly, the most talented and ambitious people need to live in the means metros in order to realize their full economic value. The physical proximity of talented, highly educated people has a powerful effect on innovation and economic growth.”
One consequence, of course, is that the means metros become less affordable. High housing prices are a curse for many average Americans. Yet they are also a sign of the desirability of a location.
Changes in the economy have severed the connection between mere population growth and economic health (e.g. Phoenix). Florida writes, “What matters most today isn’t where most people settle, but where the greatest number of the most skilled people does.”
Ideally, Seattle should strive to retain the diversity of industries it has, which still include high-value blue-collar work. But its sweet spot in the world economy is as a talent magnet.
Today’s Econ Haiku:
Misusing TARP funds.
I’m shocked, shocked to find gambling
going on with banks!
Check out the winner from last week’s Econ Haiku contest — and the write-in candidates.
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