In the digital economy, cities and locations around the world are competing for talented tech specialists. After all, they are the people who make the difference. According to a new study, Munich is by far the best German city when it comes to attracting talented individuals, although smaller cities too are quite successful.
The digital economy could blossom everywhere if only the Internet were fast enough. Typical location factors such as the availability of raw materials are irrelevant. However, knowledge and thus people too are increasingly becoming a key production factor. And the people companies are looking for are creative, mobile types who enjoy city life and value a high quality of living. Cities that combine this with top-class research and education are therefore becoming talent magnets and, in turn, hotbeds of innovation.
The result: the digital sector is concentrated at relatively few locations. In Germany too. On the basis of various indicators, the business consultancy firm Deloitte has looked into which regions currently attract the biggest numbers of tech specialists.
According to the study, the Munich metropolitan region is by far the most important German tech hub. It ranks particularly highly given its focus on the ICT industry. It has by far the largest number of STEM (Science, Technology, Engineering and Mathematics) professions in the entire city economy. As a result, Munich leads the way not only in the original digital sector but also when it comes to the all-important digitalization of classic industries.
For example, the Bavarian state capital has higher absolute employment in the ICT sector and the STEM professions than Berlin, a city twice its size. And in spite of this impressive level, Munich tops the ranking when it comes to the dynamics of STEM employment too. The same applies to the proportion of complex STEM professions, the reputation of universities and expected developments on the jobs market between now and 2030.
Berlin was in second place in the overall ranking. It ranks highly when it comes to the dynamics of employment in the ICT sector and in STEM professions as well as the absolute number of STEM students. However, the extremely low proportion of STEM professions in relation to overall employment means that the capital city is in last place in this category. As far as the overall ranking is concerned, Hamburg (4th place), Stuttgart (5th place) and Frankfurt am Main (8th place) all made it into the top ten.
Smaller cities as tech hubs
The digital economy favors predominantly large cities. Thanks to the educational opportunities and research institutions here, know-how meets the necessary infrastructure. However, there are the hidden champions too. For example, Darmstadt is third in the overall ranking and with its very high proportion of STEM students and an excellent university reputation leaves behind most big cities.
Smaller university and research cities follow in 6th to 10th place. Erlangen, Karlsruhe, Aachen, Münster and Regensburg are ahead of much bigger cities such as Düsseldorf or Leipzig in the index. They do well when it comes to specialization in the ICT sector (Karlsruhe) or STEM employment (Regensburg, Erlangen). This is reflected not only in start-up activity but also the regional economic structure with large companies which goes hand in hand with top positions for STEM professions.
You can download the full study here.