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Wednesday, Feb 28, 2024

Media, Entertainment Drive LA’s Growth as a Tech Hub

Los Angeles is cementing its status as a hotspot for the tech industry.
L.A. and Orange Counties ranked ninth in CBRE Group Inc.’s 2021 “Scoring Tech Talent” report, advancing eight spots from last year’s report.

The report ranks 50 North American markets on their tech talent based on a variety of factors, including graduation rates among students with tech degrees, the number of tech jobs in the area, labor pool size and housing costs.

Blake Mirkin, executive vice president of CBRE’s West L.A. office, attributes the region’s jump in ranks to the convergence of the tech industry with the media and entertainment industry, which have boomed due to pandemic-driven demand for content.  

“Technology is entertainment, entertainment is technology, and media is intertwined with all of them,” said Mirkin. “Los Angeles has always been very robust in each of these, and it’s continued to get stronger.”

Mirkin added that many L.A. and Orange County tech workers aren’t employed by tech-specific companies, reflecting a nationwide trend. In North America, roughly 60% of tech workers are employed by non-tech companies, he said.

Some of the L.A. region’s major employers of tech professionals include Burbank-based Walt Disney Co., Seattle-based Amazon.com Inc., Los Gatos-based Netflix Inc., Santa Monica-based Lions Gate Entertainment Corp. and Cupertino-based Apple Inc., Mirkin said.

These major companies and others in the tech and media industries have a massive well of qualified workers to choose from as they continue to grow.

According to the CBRE report, L.A. and Orange Counties have the fifth-largest tech talent labor pool in the United States, with 228,720 qualified tech workers in the region. That is an 18.6% increase from 2015.

The area also produced 61,261 tech graduates from 2015 to 2020. Mirkin said the prestigious tech programs at the area’s universities, such as USC, UCLA and Loyola Marymount University, are a big draw for young people getting into the tech field.
Though the labor pool increased, the market also experienced what the report called “brain drain,” with 25,391 recent tech graduates finding work in other regions, as only 35,870 new jobs emerged from 2016-2020.

But Colin Yasukochi, executive director of the CBRE Tech Insights Center, said the surplus of graduates makes L.A. an attractive place for companies to set up shop.
“(Employers) are looking at what the flow of talent is into the market and if there is going to be a ready labor supply for them to be able to establish a presence there,” Yasukochi said.

Though the region has not yet cracked into the top five on the report’s overall ranking, which consists of the San Francisco Bay Area; Seattle; New York City; Washington, D.C.; and Toronto, Yasukochi said the L.A. and Orange County region has “consistently risen through the ranks” as a tech hub.

“The main thing that contributes to (the score) is how large is the tech talent workforce in the area and how quickly that’s growing,” Yasukochi said. “How many tech degree graduates is it adding, and if it has a growing and thriving technology industry, all those factors in the L.A. region have improved over the years.”

L.A. has become an attractive spot for the tech industry, Mirkin said, but some of the tech talent growth can be attributed to workers being priced out of other areas.
L.A. and Orange Counties saw a 31% increase in in-migration from the San Francisco Bay Area in 2020, according to Mirkin, and though this growth is not entirely tech-related, he said it establishes the area as a “complementary hub” to Northern California.

And with the growing intersection of tech and content, Mirkin only expects the region’s tech industry and talent pool to grow.

“We’re still seeing the flight to content for the entertainment side, which is so heavily laden with technology,” Mirkin said. “Even through the pandemic, it really led everybody in surprising growth.” 

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