Saint Louis: Not a Tech City

Saint Louis officials constantly tout the growth of tech companies in the metropolitan area and the city specifically. Whether it’s Square’s choice to relocate to Cortex or new startups at T-Rex, city officials push the idea that the region is a rising high-tech hub. They also spend lavishly to attract more tech companies and promote tech startups. As Mayor Slay put it:

We have made a conscious decision as a community to build the infrastructure to retain, attract and grow tech companies here and support entrepreneurship. It’s one of our strongest economic drivers.

Unfortunately, the data tell a different story.

Recently, the San Diego Economic Development Corporation released a comprehensive report on the national tech sector, where it also ranked cities based on the health of their tech scene. Of the country’s 50 largest metros, Saint Louis ranked an unimpressive 28th, placing it below regional competitors like Indianapolis, Columbus, and Oklahoma City.

One of the most jarring reasons for Saint Louis’s low ranking, given the rhetoric, is the fact that the region has comparatively few software developers. The region has only 8.8 software developers per 10,000 workers, low for a large city. For comparison, San Francisco, Raleigh, and Washington, D.C., each have more than 20 developers per 10,000 workers (San Jose has more than 60). Worse yet, tech jobs actually decreased in Saint Louis from 2010 to 2014 by almost 10%. Average tech employment increased by more than 13% in the country’s largest cities during that same period. It’s hard for the region to be a rising tech hub when it has fewer and fewer software developers.

In terms of the tech sector pipeline, Saint Louis also performed poorly. The region’s residents are much less likely to have math or computer science degrees than are residents in other cities. If it’s harder to find tech talent, it’s harder to attract tech companies. One of the few bright spots for Saint Louis is money. After adjusting for cost of living, tech workers in Saint Louis get paid more than they would in most other large cities. In addition, Saint Louis attracts a decent amount of venture capital given the size of its tech sector.

To sum up, Saint Louis has established tech companies. It has startups and a tech incubator. But that can be said of almost any large American city. Taking a national view, Saint Louis’s tech growth strategy seems downright banal. As Aaron M. Renn from the Manhattan Institute put it:

Civic policy at the local level is dominated by “school solutions” that promote the same characteristics everywhere, often as a way of signaling that a city belongs in the “club.” …most cities try to look exactly the same as other cities that are considered cool, including offering bike lanes, coffee shops, microbreweries, a creative class, a food scene, and a startup culture. Even most cluster analysis seems to produce primarily a collection of the same five basic focus areas in every region (high tech, life sciences, green industry, advanced manufacturing, and logistics).

Simply having a tech scene is a natural result of being a populous region in the 21st century; it shouldn’t be taken as a sign that Saint Louis is about to have an economic transformation. The fact is, despite public support, Saint Louis’s tech scene is not a large player nationally, nor is it a terribly significant driver of the Saint Louis economy.