6 Up and Coming US Tech Cities
As the world's largest tech and IT market, the US continues to set the pace for innovation and digital transformation. With a market value of $1.8 trillion, the tech industry is a driving force behind the nation's economic growth and job creation, accounting for 7.9% of total US jobs, and 10.5% of the country’s GDP, making it the second-largest driver of the US economy, just behind healthcare.
With the rapid expansion of artificial intelligence and the ground-breaking advancements in cybersecurity and blockchain, the US tech and IT sector is expected to grow by 5.4% in 2023.
If you are looking to establish a presence in the US tech industry or are a tech recruitment specialist looking to hire skilled talent in a thriving region, you may be interested to know what cities have a thriving tech scene that isn’t already overly saturated.
This is why we’ve researched where some of the up and coming tech cities in the US are emerging.
Phoenix, Arizona
Phoenix is rapidly emerging as a vibrant and promising tech hub, captivating entrepreneurs and tech enthusiasts alike.
In the 2023 DICE Tech Salary report, Phoenix witnessed the fastest growing increase in salary from the previous year (+26.2%).
Tech employment has steadily increased in Phoenix over the last decade, and with a projected growth of 4700 new jobs in 2023, this growth does not look like slowing down. As a matter of fact, CompTIA has projected that the entire state of Arizona with see the 6th highest increase in tech occupation growth over the next decade.
In addition to being the fifth-largest city in the US, ‘The Valley’ has grown to become the fifth-largest data centre market in the country and is now ranked as the ninth-largest globally.
Companies will be provided with confidence in Phoenix as one of the up and coming tech cities due to its ability to bounce back after the covid-19 pandemic, replacing all of its lost jobs by the middle of 2021. Phoenix’s powers of recovery from the economic impact of the pandemic can be likened to the mythical creature of the same name!
Although situated in the southwest, non-stop flights are available from London to Phoenix, meaning the city is accessible for European businesses if they have offices on both sides of the Atlantic.
Furthermore, the city's lower cost of living compared to major tech hubs like Silicon Valley makes it an attractive destination for start-ups and tech companies looking to establish a presence with operational costs of 36% less than in neighbouring California.
Phoenix is a welcoming city for multinational companies and small start-ups alike. Companies such as Amazon, Deloitte, Intel, and TikTok all have a presence in the city whilst PHX Startup Week provides education and support to entrepreneurs.
The city's business-friendly policies and proactive initiatives by organisations such as the Greater Phoenix Economic Council have also played a crucial role in attracting tech companies and nurturing a culture of innovation. As Phoenix continues to evolve and cultivate its tech ecosystem, it solidifies its position as a rising star among up-and-coming tech cities in the United States.
Tampa, Florida
If you’ve been following PGC for a while, you’ll not be surprised to see Tampa included on this list as an emerging tech hub in the US! We have borne witness to the city’s growth with many of our recruitment clients opting to set up operations there. We previously listed the pros and cons of starting a business in ‘The Big Guava’.
Florida as a whole has emerged as a key state in the tech industry. Last year, we cited Miami as one of the fastest-growing tech hubs in the country. The ‘Sunshine State’ saw the highest number of new tech businesses established across the country in 2022.
We’ve included Tampa in this list over Miami as the former is a generally less saturated and more up and coming market. Tampa witnessed the 2nd fastest growth for tech salaries in DICE’s report, growing 19% from 2021. The city, which alone makes up 25% of Florida’s tech jobs, saw an increase of over 2000 new tech jobs last year, with a further increase of 1700 predicted for 2023.
Similar to Phoenix, Tampa has incentives to attract companies of all sizes. Companies such as Apple, Oracle, and Microsoft all have offices in the city, whilst organisations such as Embarc Collective and Tampa Bay Innovation Center provide support to tech businesses.
Florida is historically known for attracting retirees; however, Tampa Bay is quickly shedding that stereotype. Tampa has a thriving entrepreneurial ecosystem with co-working spaces, incubators, accelerators, and access to capital that creates an environment where tech companies can thrive. With its robust infrastructure and talented workforce, Tampa has the potential to become one of the leading new tech hubs in the US southeastern region in the coming decade.
Charlotte, North Carolina
North Carolina was the 3rd highest state for new tech businesses established in 2022. One city that played a key role in this growth was Charlotte, aka the ‘Queen City’.
A city more renowned for being a financial services hub, Charlotte’s tech industry has arguably flown under the radar in the last couple of years while experiencing strong levels of growth. This may be partly due to North Carolina’s famous research triangle which garners much attention. We spoke about this when citing Raleigh as a fast-growing tech hub. Charlotte saw a growth of over 2500 new tech jobs last year and this is expected to increase by a further 2700 jobs in 2023, outperforming the aforementioned Raleigh.
As technology is continuing to be more implemented in banking, there is strong traction for an increasing number of tech jobs within Charlotte’s financial hub. The friendly business environment has attracted a number of IT & tech giants, such as IBM, Lenovo, Google, and Citrix.
A growing number of resources exist for young tech startups, including Tabbris, BLKTECHCLT, and Carolina Fintech Hub, In October 2022, Lowe’s opened a $153 million Tech Hub to promote innovation, attract top talent, and accelerate digital transformation.
Interestingly, Charlotte has the highest rate of female CEOs for IT companies in the entire US, further cementing its place as one of the up and coming tech cities to watch in the US.
Salt Lake City, Utah
CompTIA has projected the state of Utah to see the highest growth of tech occupations over the next decade. Leading this growth is the state capital, Salt Lake City. Referred to as the ‘Silicon Slopes’, Salt Lake City has an emerging tech scene.
The city saw an increase of 2600 tech jobs in 2022, with a projected growth of 3000 expected in 2023. As a state, Utah has the 9th highest concentration (7.2%) of tech workers relative to its overall employment base.
Salt Lake City is home to leading universities and research institutions that produce a steady stream of talented graduates in fields such as computer science, engineering, and data analytics. The University of Utah is particularly renowned for its top-ranked engineering and technology programs, consistently supplying the local tech industry with skilled professionals. You may be surprised that Salt Lake City has more tech degrees per capita than Boston or San Francisco with 5300 tech degree graduates annually.
The age profile of Salt Lake City’s demographic points towards an increase in tech jobs. 21% of the city’s residents are aged between 23 and 28, significantly higher than the national average of 13.9%
Companies such as Adobe and eBay both have a presence in the state, employing thousands of people while initiatives such as Tech Lake City and Silicon Slopes promote Salt Lake City’s thriving tech scene.
In conclusion, a supportive business environment, highly educated workforce, and low cost of doing business (6% below the national average) mean that Salt Lake City is well-positioned to continue attracting tech companies and emerging as a significant player in the tech industry.
Denver, Colorado
Over 1600 new tech businesses were established in the state of Colorado in 2022, making it the 5th most popular state for emerging tech companies.
We have previously explored why companies, including those in the tech industry, have relocated to Denver. The city has become a hidden gem for tech talent thanks to its developing FinTech scene as highlighted by Forbes.
Denver saw an increase of 6300 tech jobs in 2022, making it the 7th largest growing metro in the US for this sector. This trend of high growth is expected to continue in 2023 with a further 6000 jobs added.
The average tech salary in Denver is $120,957, significantly lower than traditional tech hubs such as Silicon Valley and Boston.
The influence of the tech industry on Colorado’s economy does not show signs of slowing down. The state has the 5th highest concentration (8.3%) of tech workers relative to its overall employment base. Meanwhile, Colorado has the fourth-highest share of STEM workers in the US. Denver is expected to continue to play a key role in this development, especially when every 3 in 5 new tech jobs in Colorado in 2022 were created in Denver.
Denver benefits from a central geographic location that offers easy access to both the West Coast and East Coast markets. This strategic location has positioned the city as a gateway for tech companies looking to expand their operations and reach new customers. Additionally, the city boasts a robust transportation infrastructure, including an international airport, which makes it easy for businesses and professionals to travel in and out of the city.
Nashville, Tennessee
Traditionally more renowned as a health services hub, Nashville is quickly becoming the rising star of tech innovation in Tennessee. Over 3100 tech jobs were created in ‘Music City’ in 2022, amounting for 43% of the total tech jobs created in the entire state.
2022 saw almost 1500 new tech businesses establish in Tennessee, making it the 8th most popular state for emerging tech companies.
We have previously explored why companies, including those in the tech industry, have chosen Tennessee as a key location. In the last two years, Amazon chose Nashville as one of its key corporate headquarters, creating 5,500 jobs in the process. In addition to this, Oracle has announced that they are going to replicate their headquarters in Austin, TX to create another HQ in Nashville, with the plan of creating 8,500 tech jobs over the next decade, investing a total of $1.35 billion.
The tech scene in the state of Tennessee looks set to only grow further, with CompTIA predicting a 26% increase in tech occupation growth in the next decade, making it the 4th highest state for growth and one to keep an eye on.
With no personal income state tax on wages and salaries, a reasonable corporation tax of 6.5%, and some of the lowest property tax rates in the US, it is certainly not outside the realms of possibility for even more tech companies and talent to set up in Nashville.
Ready to Take the Next Step in Your US Business Expansion Journey?
These up and coming tech cities demonstrate that you don’t have to operate in Silicon Valley or the traditional tech hubs in the US to make connections and grow your business.
Whether you want to get set up in one of the new tech hubs in the US, or have your sights set on a different location, as an employer of record, we are registered in all 50 US States to help you easily and compliantly employ workers.
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Disclaimer: All information written here is for general informational purposes only and is not intended to be a substitute for professional and/or legal services.