With ex­pan­sions of in­dus­try gi­ants, New York could be­come tech hub

With Ama­zon and Google re­port­edly grow­ing in the city, oth­ers may fol­low

The Washington Post - - ECONOMY & BUSINESS - BY HAMZA SHA­BAN

Two of tech’s big­gest com­pa­nies are re­port­edly eye­ing ma­jor ex­pan­sions in New York — moves that ex­perts say high­light the area’s as­cen­dance as a ma­jor tech­nol­ogy hub and the depth of the city’s mas­sive ta­lent pool.

Ama­zon.com may be clos­ing in on a deal to bring part of its sec­ond head­quar­ters to Long Is­land City in Queens, ac­cord­ing to the New York Times, and Google is plan­ning to am­plify its pres­ence in Man­hat­tan, ac­cord­ing to the Wall Street Jour­nal. En­trepreneurs and pol­icy ex­perts say tech com­pa­nies are drawn to the city’s rich di­ver­sity and skilled work­force, trans­form­ing it over the last decade into a vi­brant tech strong­hold and ex­pand­ing the in­dus­try’s foot­print be­yond its West Coast ori­gins.

“Ed­u­ca­tion, ex­per­tise, ac­cess to cap­i­tal, ac­cess to cus­tomers, a place where peo­ple want to live. What you see is a thriv­ing ecosys­tem,” said Julie Sa­muels, ex­ec­u­tive di­rec­tor of Tech:NYC, a group that rep­re­sents New York-based tech firms. Tech com­pa­nies and their em­ploy­ees are at­tracted to the city’s es­sen­tial char­ac­ter­is­tics: arts and cul­tural in­sti­tu­tions, neigh­bor­hoods con­nected by pub­lic tran­sit, restau­rants, cof­fee shops and bars, Sa­muels said.

The city’s tech in­dus­try al­ready em­ploys 320,000 peo­ple, ac­cord­ing to Karen Bha­tia, the vice pres­i­dent of ini­tia­tives at the New York City Eco­nomic Devel­op­ment Cor­po­ra­tion (NYCEDC). And of­fi­cials have in­vested in pre­par­ing young peo­ple to join those ranks. The city’s more than 120 col­leges and uni­ver­si­ties pro­duce 4,500 com­puter sci­ence ma­jors ev­ery year, Bha­tia said. “We have the ta­lent in­fra­struc­ture here in New York.”

Both Ama­zon and Google would be ex­pand­ing their ex­ist­ing work­force in the area. Ama­zon has more than 2,000 em­ploy­ees in New York out of a global head count that ex­ceeds 613,000. The on­line re­tail gi­ant could even­tu­ally bring 25,000 highly paid work­ers to the area if it de­cides to build a piece of its sec­ond head­quar­ters there.

Google counts roughly 7,000 peo­ple in New York out of a to­tal of more than 94,000 em­ploy­ees. Ac­cord­ing to the Jour­nal re­port, Google is plan­ning to add space there for more than 12,000 new em­ploy­ees.

Google and Ama­zon de­clined to com­ment. (Ama­zon founder Jef­frey P. Be­zos owns The Wash­ing­ton Post.)

Ama­zon has not dis­closed the job list­ings for their sec­ond head­quar­ters, but the com­pany said they would be high-pay­ing jobs. It’s likely many of the po­si­tions are slot­ted for skilled com­puter en­gi­neers, who can earn six­fig­ure salaries. Ex­perts say the in­tense de­mand for tech­nol­o­gists al­lows work­ers to com­mand even higher wages, with top tech com­pa­nies com­pet­ing for the best em­ploy­ees, blunt­ing the costs of liv­ing in New York.

In­ter­net en­tre­pre­neur and in­vestor Kevin Ryan, who has founded sev­eral tech com­pa­nies in New York, said peo­ple of­ten un­der­es­ti­mate the city’s suc­cess as a tech cen­ter be­cause it hasn’t spawned a mega com­pany on the scale of one like Face­book. Plus, the city’s tech sec­tor is ob­scured by sev­eral other world-class in­dus­tries na­tive to the area, such as fi­nance and ad­ver­tis­ing. But in­vest­ments in the New York tech scene have grown at a dra­matic pace. Last year, start-ups raised $12 bil­lion in ven­ture cap­i­tal, up 40 per­cent from 2016, ac­cord­ing to the NYCEDC.

“New York dom­i­nates the East Coast and will con­tinue to dom­i­nate and con­tinue to grow be­cause we have the hu­man ta­lent,” said Ryan, the co-founder and chair­man of Al­leyCorp, a net­work of start-ups. “Tech com­pa­nies are just peo­ple, and, un­like other in­dus­tries, the peo­ple are so im­por­tant that it’s not about cost.”

While New York is known for its high cost of liv­ing and its strained sub­way sys­tem, its tech scene has not drawn the scorn of crit­ics who point to the Bay Area’s hous­ing cri­sis and Sil­i­con Val­ley’s in­su­lar na­ture and sin­gu­lar fix­a­tion on tech­nol­ogy.

“What re­ally makes New York stand apart is that tech is the sixth or sev­enth most im­por­tant thing in New York — be­hind mu­sic and pub­lish­ing and fash­ion and fi­nance,” said Den­nis Crow­ley, the co-founder and ex­ec­u­tive chair­man of Foursquare. “You can do great things in tech and still no one will know you at the cock­tail party. And that is the beauty of it — that is the an­tithe­sis of Sil­i­con Val­ley.”

DREW ANGERER/GETTY IMAGES

As large cor­po­ra­tions and small start-ups alike take root in New York, some ex­perts be­lieve the city could be­come a ma­jor hub for the in­dus­try, with help from the city’s ed­u­ca­tion and cul­tural re­sources.

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