San Diego moved up three spots in an annual ranking of 50 U.S. and Canadian markets by each regions' ability to attract and grow tech talent.
The report, the sixth annual published by commercial real estate services company CBRE, listed San Diego at No. 16.
The top five markets were the San Francisco Bay Area, Seattle, Washington, D.C., Toronto and New York. It was the first time a Canadian city appeared in the top five.
San Diego, Cleveland and Columbus registered the greatest rise in the rankings.
CBRE called San Diego an attractive market for tech talent, citing the region's comparatively competitive wages and affordable living costs.
“The San Diego tech ecosystem offers a strong and growing skilled tech talent labor pool, competitive wages and a lower cost of living compared to other top tech markets in which we compete for talent,” said Andrew Ewald, who leads CBRE’s tech and media practice in San Diego.
The rankings were determined based on 13 metrics, including the percentage of employed people working in tech.
From 2012 to 2017, San Diego’s tech labor force grew by 20.4 percent, adding 11,870 tech jobs. The region ranked No. 20 of the 50 analyzed for its tech talent total.
Of total employment in San Diego, 4.9 percent - 70,100 workers – work in tech, CBRE said. That's above the national average of 3.5 percent.
Wages in San Diego for tech workers ranked eighth among the markets analyzed, with the average annual salary rising 16.6 percent to $102,994 in five years.
Between 2011 and 2016, San Diegans earned 13,460 tech degrees, the report said. The region has the 11th highest concentration of software developers and programmers as a percentage of its total tech talent pool - 35.6 percent, or 24,850 workers. But San Diego experiences "brain drain," with more tech talent supply being produced than demand, CBRE said.
San Diego ranked the 10th costliest market for tech companies. CBRE estimated it would cost a 500-person tech company needing 75,000 square feet of office space in here $45.84 million to operate annually.
In the costliest market, the Bay Area, CBRE estimated the annual operating cost would be $59.12 million. Los Angeles and Orange County also made the top 10, with estimated annual operating costs of $46.59 million and $45.94 million, respectively.
In the five years since the first quarter of 2013, office rents in San Diego have risen 31 percent to an annual average of $35.07 per square foot being asked by landlords renting space directly, CBRE said. In the same time, the vacancy rate has fallen by 3.3 percent to 11.2 percent.
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