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Why did Austin become one of the hot spots of the nineties while Pittsburgh is still, well, Pittsburgh? They’re both prominent midsize cities with attributes that should have guaranteed economic success. But while the Texas capital exploded in the past decade-doubling its population and turning itself into a high-tech magnet-the Steelers’ hometown stalled out, losing thousands of people, including many of its most creative residents. The divergent fates of these two cities has long bedeviled Richard Florida, a professor at Carnegie Mellon University in Pittsburgh. After continually seeing his students leave town after graduation, he embarked on extensive research into the nature of regional economic development. Why are some cities winners and others losers? The answer lies in the new preferences and power of the best and the brightest, which he’s dubbed the creative class. Their tastes-what they expect and demand of a hometown and an employer-have changed dramatically over the past few decades. And what they want, they get, because they’re now the most prized employees in a postindustrial economy driven by innovation. Earlier elites judged a city to be top-drawer according to such criteria as cultural institutions, professional sports teams, and comfortable suburbs-all features which places like Pittsburgh, Cleveland, and Detroit can boast. But today’s hotshots have a different wish list when they look for a new hometown. Members of the creative class want a city that has a bustling nightlife, opportunities for outdoor recreation, and a high tolerance for diversity. That’s why Austin, Boston, and Seattle won the national contest to become the next Silicon Something. Gays And High-Tech It’s a compelling argument, made even more so because Florida seems to have looked at his data first and then come up with an explanation. The author’s eureka moment occurred when he compared a list of the country’s top high-tech centers to a ranking of the cities with the highest concentration of gay and lesbian couples. He found a remarkably high degree of overlap between the two tables. “In virtually all of our statistical analysis, the Gay Index did better than any other individual measure of diversity as a predictor of high-tech industry,” Florida writes. The reason, he emphasizes, isn’t that technology companies hire a lot of gay men and lesbians. It’s that they hire a lot of outsiders. Whether the star software engineer is a tattooed and pierced Gen Xer, or a new immigrant just off the plane from Bombay, he will feel most comfortable in a company-and a city-that clearly and visibly tolerates diversity. And few things demonstrate tolerance in today’s America like the acceptance of gays. But in order for a city’s economy to grow, tolerance must be accompanied by technology and talent. Florida measures these characteristics with a variety of yardsticks: the percentage of a metropolitan region’s residents with a college degree; the concentration of high-tech industry in the region; and the number of patents granted per capita. The most thriving cities, he says, rank high on all of these charts. Put talented people into a tolerant environment, and creativity takes off. No place better illustrates this point, Florida writes, than San Francisco. The Bay Area has a higher percentage of both gays and tech businesses than any other metropolitan region in the country. Each group has flourished because the area is “open and supportive of the creative, the different, and the downright weird.” That spirit was just as important for Silicon Valley’s growth as was the proximity of Stanford University. Because of San Francisco’s influence, Florida writes, “[t]he Valley was able to integrate those who were offbeat, not ostracize or discourage them.” New Economy Thesis Project For all its strengths, however, The Rise of the Creative Class seems a bit last-century. The book often reads like a New Economy thesis project, especially in its focus on the high-tech industry as a measure of a city’s success. That emphasis seems particularly out-of-date in Austin, where the most notorious new landmark is a half-finished office building abandoned by Intel Corporation after its fortunes turned south. In scores of patches that seem specifically added to address the Nasdaq crash and 9/11, Florida contends that the changes he’s reported are real and permanent. But now that the job market is a shadow of what it was two years ago, can members of the creative class still afford to be so picky about where they want to live and work? If they can, the key to Austin’s continued success might be contained in a local bumper sticker (ironically popularized by longtime natives unhappy with the city’s growth). “Keep Austin Weird,” it says. A slogan, Florida would argue, that chambers of commerce across the country should adopt. Zabcik is senior editor at Corporate Counsel.

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