San Antonio And Innovation Convergence

Like agriculture and manufacturing before it, the Innovation Economy is converging.  Knowledge production is shifting from expensive global cities (Spiky World) to former backwaters with ample cheap housing (Flat World). This transformation is still in its infancy. Joel Kotkin (New Geography) notes the trend is gaining momentum:

Yet the pattern is clear: brainpower is spreading out. The notion that companies seeking skilled labor have to go to one of the “hip” cities — an idea relentlessly marketed by the New York and D.C.-based press — appears greatly overstated. In reality, skilled, college-educated people are increasingly now scattered throughout the country, and often not where you’d expect them. For example, Charlotte, N.C., Columbus, Ohio, Kansas City and Atlanta now boast about the same per capita number of college grads as Portland and Chicago, and have higher per capita concentrations of grads over the age of 25 than Los Angeles.

Like I've seen with Pittsburgh, much of this brain gain is ironic and hidden beneath larger demographic forces. I've learned a lot about the economic geography of talent from the Rust Belt. I'm now applying those lessons in San Antonio, Texas:

Attention hand-wringers: There is no brain drain from San Antonio.

That's the counterintuitive news from [a report released Wednesday that looked at migration patterns in and out of San Antonio.]

That's not to say that those who earn their degrees in the Alamo City aren't pulling up stakes for greener pastures; they are. But college grads in other parts of the country are moving here, and they, along with those who return, are ultimately more valuable, said Jim Russell, a geographer who studies the relationship between migration and economic development.

“We know people are going to leave. That's a fact of life,” said Russell, who was asked to look at how San Antonio might become more like Austin, its more highly educated neighbor to the north.

[This report], commissioned by Rackspace Chairman Graham Weston's 80/20 Foundation, doesn't answer that question. First the problem needed to be measured, Russell said, and what he found upends the conventional wisdom about the inevitable flight of San Antonio's young and educated.

As I told San Antonio journalists last week, the results are surprising. I did take a look at how such brain gain could go unnoticed. The metro is booming across the board. Relative to the rest of the country, the concentration of college graduates barely moves forward over the last Census decade. That's the source of the hand-wringing about brain drain. The region sees itself as, “Poor, Hispanic, low wage, third tier city." The rock bottom percentage of 25+ year-old adults with a college degree reinforces the perception.

The data show that more people with college degrees are moving to San Antonio than leaving. Like in Cleveland, return migrants are leading the charge:

Teno Villarreal is part of that coveted cohort of young educated workers, and he's just returned home.

The 34-year-old St. Mary's University graduate returned two months ago after a stint in Washington, D.C., working on Capitol Hill and in the Department of Labor.

“San Antonio is doing some great things that made me want to come home and get involved,” said Villarreal, who works for the marketing firm Interlex.

Emphasis added. The sentiment is common in the Rust Belt. I didn't expect to find it in San Antonio. The similarities speak to convergence, not continuing talent agglomeration. I'm now more confident that the last financial crisis served as a tipping point for the Innovation Economy. The world is now getting flatter. The Creative Class is diffusing.