Smart cities and attracting knowledge workers: Which cities attract highly‐educated workers in the 21st century?

Abstract

Regional policy‐makers have long sought to attract highly‐educated workers with a view to stimulating economic growth and vibrancy. Previous studies over the decades leading up to the new millennium show human capital divergence across cities, where the share of college graduates grew faster in cities that had larger initial shares of college‐educated workers. However, labour markets have changed significantly post‐2000, likely affecting migration decisions of highly‐skilled workers. Additionally, past studies have not controlled for important changes in industry education levels and overall industry composition that may influence city‐level college graduate growth. We use detailed 4‐digit NAICS industry employment data combined with public micro‐data to construct measures of industry skill upgrading and changes in industry composition to control for their effects on human capital growth. We find agglomeration forces, rather than initial graduate share, explains college‐graduate share growth post‐2000. We also decompose graduates into bachelors and postgraduate degree holders to determine whether different forces are at play on growth of graduates at different education levels.

Do higher college graduation rates increase local education levels?

“…A sizable literature has explored the various determinants and consequences of the migration decisions of both college graduates and non‐graduates for the US (Ferguson et al ; Chen and Rosenthal ; Whisler et al ; Waldorf ; Partridge ; Partridge et al ; Scott ; Winters ; Hawley and Rork ; Faggian and Franklin ; McHenry ; Betz et al ; Leguizamon and Hammond ; Zheng ) and other countries (Faggian et al , ; Hansen and Niedomysl ; Corcoran et al ; Brown and Scott ; Haapanen and Tervo ; Di Cintio and Grassi ; Faggian et al ; Marinelli ; Venhorst ; Liu and Shen ; Miguélez and Moreno ; Carree and Kronenberg ; Abreu et al ). These studies collectively find that numerous individual and geographic characteristics have important effects on location decisions; see Faggian et al () for a review.…”

Human capital as a location factor: An empirical investigation of relocating firms and their labour force in the Netherlands

“…A decline in area's ability to meet local labour demand is not uncommon as employees' and firms' location preferences are not necessarily aligned. Betz et al () show that highly educated preferred metropolitan areas with agglomeration and natural amenities in the US in the 2000s. No/weak evidence is found for the share of highly educated growing in metropolitan areas characterized by rapid growth of smart industries or presence of upskilling industries.…”

Are shocks to human capital composition permanent? Evidence from the Mariel boatlift

“…have slower growth in their college graduate shares (Berry and Glaeser 2005;Betz et al 2016). Thus, they would lag Miami just on that basis.…”

“…Lee (2016) finds similar results to Berry and Glaeser (2005) when using an education program as a natural experiment. However, using a similar method as Berry and Glaeser, but with more control variables, Betz et al (2016) find that a city's average level of human capital is not statistically associated with its future growth in human capital, but rather is positively linked to the size of the city. Other studies have examined the migration of skilled workers directly (Kerr et al 2017;Faggian and McCann 2006;Venhorst 2013), but do not examine aggregate outcomes and feedback effects.…”