The gateway to the South goes high-tech
Published on April 19, 2000
Atlanta leads the Southeast in high-tech employment and the nation in population growth
Last year, the Swedish firm Frontec changed its name to Viewlocity.com and moved people from around the world its new headquarters in Atlanta. "We looked at Dallas and several cities in the Northeast, but they were not right for us," says Jeff Cashman, the company's senior vice president of global marketing and business development. Viewlocity.com wanted to be at the hub of supply chain management, and it wanted access to tech talent. Atlanta offered both, says Cashman.
Viewlocity.com's relocation story isn't unique. About 1,000 other tech companies and 45,000 new workers made Atlanta home in 1999. Growing the high-tech sector is essential for a strong local economy, says the Milken Institute, a California-based economic think tank. Attempting to cash in on the new economy, states such as Minnesota and Virginia are giving tax breaks to new high-tech businesses. Atlanta is far ahead of the pack, though. New businesses and tech workers are already flooding the city, and Atlanta has no plans to slow the high-tech tide, despite the troubles growth brings.
"We're deliberately setting out to make Atlanta one of the leading, if not the leading, technology centers in the world," says Hans Gant, senior vice president of economic development for the Metro Atlanta Chamber of Commerce (MACOC).
Last year, the MACOC undertook a five-year, $15 million initiative to raise Atlanta's profile as a leading technology center. Dubbed "Industries of the Mind," it's charged with four objectives:
- Creating a buzz within and outside of Atlanta about the critical mass of technology there
- Developing and retaining local high-tech talent
- Recruiting new talent from around the country
- Attracting and growing more high-tech companies
Money for the initiative comes from MACOC members and co-op and pro bono advertising from the private sector. "Selling Atlanta is easy," says Rosita Smith, director of talent development for the MACOC initiative. But convincing people that Atlanta is a high-tech center is a little more challenging. "Many people know about Atlanta, so there's no need to promote the city as a nice place to live and work," she says. "When many people outside of the region think of the South, though, they don't think about high-tech employment opportunities."
What IT workers don't know might hurt them. Atlanta grew more quickly in the 1990s than in any other time in its history, according to Gant. Growth was swiftest in 1999, when Atlanta netted 106,300 new jobs, leading the nation in job creation. New technology jobs accounted for nearly 50 percent of that growth.
A series of other indicators confirm Atlanta's boom. The Milken Institute called Atlanta the undisputed high-tech capital of the Southeast in its July 1999 report, America's High-Tech Economy. Atlanta ranked 10th— higher than Denver, San Diego, and San Francisco— on the institute's list of top 50 high-tech poles, a factor of the city's high-tech output and location. Another Milken Institute study says that more people are moving to Atlanta than any other city in the nation— even more than are moving to Las Vegas, widely believed to be the fastest growing city in the country. The Atlanta metro area adds more than 1,200 people a week, including the young and highly educated. More than 44 percent of the newcomers are aged 18 to 34, and 57 percent of the newly arrived have college degrees.
Many of the transplants are coming for jobs. MACOC says that in 1998, some 165,000-tech workers worked for 9,000 companies in and around Atlanta. Today, that number has grown to 200,000 workers at 10,000 companies. An additional 35,000 to 40,000 techies have jobs at such nontraditional tech employers as UPS, Home Depot, and Coca-Cola.
Where smart people go, money follows. The National Venture Capital Association (NVCA) reports that Georgia led the Southeast in venture capital investment, citing more than $1.2 billion flowing into Georgia-based companies in 1999. Most of these companies are in the 20 metro Atlanta counties. Large investments in technology companies are the biggest reason for the growth, says the NVCA. The city boasts 21 incubators, which together helped launch 112 Internet companies in 1999, along with another 110 computer startups. The US Small Business Administration confirms Atlanta's new business growth, ranking Georgia tenth in the nation for new starts. The city is strongest in telecommunication services, computers, and data processing, according to the Milken Institute.
Mirroring nationwide trends, software developers are the toughest employees to find in the Atlanta area, according to Techies.com's Job Families Index. The high-tech career center for IT professionals reports that the job prognosis looks good for those working in new media, systems administration, and computer programming. According to Gant, average tech salaries fall between $50,000 and $90,000.
What's drawing people to Atlanta? Besides the good weather, it's easy to get there and leave. Hartsfield Atlanta International Airport— the busiest airport in the United States, according to the Department of Transportation— plays a major role in connecting Atlanta to the rest of the world. Cashman reports that every month, Viewlocity.com's executive team is jetting to company offices in Singapore or the United Kingdom. "There are a lot of nonstop international flights," he says.
Connections of another sort make Atlanta a top tech sector, too. According to Yahoo's Most Wired Cities guide, Atlanta is the second most wired city in the nation, falling behind only Austin, Tex. And Georgia is home to a large number of outstanding colleges and universities, including Georgia State University, Emery, Georgia Tech, Spellman, and Morehouse. "We looked at the other places around the country and came to Atlanta because of the labor pool," says Cashman.
Success comes at a price, though. Atlanta workers complain of long commutes in bumper-to-bumper traffic. Nowhere is the growth more apparent than on the freeways, according to Atlanta businessman Tom Greaves. The former Atlanta resident, who chairs the Atlanta-based education company NetSchools Corporation, says freeways have widened from two lanes to 16 lanes since the 1970s. Traffic is so bad in some parts of the city that one company has even banned employees from commuting during rush hour.
Housing prices have risen, too. "But compared to places like Boston, Northern Virginia, and Silicon Valley, our housing prices and cost-of-living numbers are more favorable," Gant says. For instance, a person making $56,000 in Atlanta can lead a lifestyle comparable to someone earning $90,000 in San Jose, Calif., according to the Center for Mobility Resources, an executive relocation service.
Though the technology boom is contributing to Atlanta's problems, the industry is likely to solve some of them. "These are clean jobs," says Gant, "not smokestack industries."