Miami gaining tech ‘superstar’ status — but report warns of challenging ‘side effects’
By now it’s a familiar narrative: Thanks to a confluence of pandemic-era factors, Miami has suddenly found itself at the center of a tech boom.
But a new report from the Brookings Institution, a Washington D.C.-based nonprofit think tank, warns that the overnight success the area’s innovation sector has experienced has likely produced growth so rapid that it is outpacing the ability of policymakers to manage it.
Even prior to the pandemic, the Miami metropolitan area, which includes Fort Lauderdale and Pompano Beach, was seeing growth in high-tech fields like data processing and software publishing at a faster rate than most any other major metro area in the country, Brookings said. Between 2015 and 2019, South Florida’s tech sector job growth averaged 6.6% — equal to Denver’s rate, and trailing only San Francisco and Seattle among established tech hubs.
Between 2019 and 2020, tech job growth slowed dramatically across the country, including in the Miami area, where the rate fell to just 0.1%.
Still, the region ended the period with nearly 40,000 high-tech workers, compared with fewer than 31,000 just five years earlier.
“It’s the superstar phenomenon,” said Mark Muro, senior fellow and policy director at Brookings Metro and co-author of the report. “It has a lot of benefits — productivity, efficiency, innovation.”
Yet in cases like Miami’s, the growth has come at a cost.
“What has became painfully evident ... is that the hyper growth was bringing all sorts of negative externalities affecting traffic, real estate, and overall quality of life — with housing in the foreground,” Muro said.
Recent data suggest Miami, already struggling with a housing affordability crisis, has now become one of the least affordable areas in the country — if not the least affordable, period.
Muro said rapid growth coupled with a soaring cost of living is a trend that has played out frequently among cities that have seen booming tech sectors, notably in the Bay Area and Seattle — and now playing out here and elsewhere.
“Now we read the stories about this as a kind of genre,” Muro said. “It seems to be, in the U.S. approach, totally tied to tech growth. The latest case is Austin. The benefits of concentrated tech growth are now very much tied up with the side effects. So the key question is are any places going to get ahead of it, and it seems very hard to so far.”
The reason lack of affordability often accompanies tech growth is the nature of the jobs tech now produces. Muro calls the workers “foot loose” or highly mobile workers armed with merely a laptop.
“Workers can show up really fast and participate in companies and industries that are growing very fast,” he said. He compared it to other industries that require large investments in infrastructure — investments that often pay dividends in terms of having a broader increase in quality of life.
The Brookings report data only track job growth thru 2020, meaning it did not capture the surging tech job growth the Miami region saw in 2021. By many accounts, local tech firms are now struggling to hire qualified workers — a situation that is a far cry from the labor environment a decade ago, when many found themselves out of work.
Miami-area policymakers are showing signs that they are starting to confront the crisis, with some admitting that the city has become a victim of its own success. Miami Mayor Francis Suarez recently earmarked more than $5 million raised through MiamiCoin investments to affordable housing. The city has also announced a new tech-focused high school with Miami Dade College; the school also received a $15 million investment to beef up its tech faculty. And Wednesday, Miami-Dade County officials announced a new partnership with Google to help 500 residents achieve tech training certificates.
But is it better to have the growth than none at all? Muro said almost no city has been able to escape that either-or outcome.
“We have too few places that have too much (tech), or very intense spikes that are not being managed; and then many other places need much more tech growth,” he said.
“These are the kinds of jobs that provide mobility, decent pay and vitality to the region — but the main status quo is one of too much and too little. We need a model of managing growth when it is taking off, and need a model for helping more places connect to the technology pathway.”
This story was originally published March 10, 2022 at 6:00 AM.
