May 3, 2017, 4:52 PM
Each month we’re sharing the latest topics on talent, location selection, office design and construction and other real estate-ish topics that can help you make smart decisions for your business, your space and your people. Without further ado, your May edition.
Following years of seemingly unstoppable growth, the tech industry is feeling some growing pains. Where we once witnessed a stream of +200K square-foot deals and $500 billion-dollar VC funding rounds, those deals are slowing down. However, the impact of quick growth is still resonating. Where can you find talent? How will you source funding? And where on Earth is a spot to park?
Here are five perspectives on tech growing pains and a few potential solutions to solve them.
TechSpec news roundup: May 2017
Trump signs order that could lead to curb on foreign workers
Perhaps the biggest talent question of the moment is what will happen to skilled foreign workers? So far, not much. President Trump signed an executive order asking federal agencies to review the H1-B visa program for possible improvements. The Administration’s goal is to give preference to the highest-skilled workers, which would benefit established firms. Startups, however, can only afford below-market average salaries. Change remains to be seen, but for the first time in years, the number of H1-B visa applications dropped year-over-year.
While many companies are trying to find talent, others are struggling to keep it—particularly when they’re female or minority hires. The Kapor Center for Social impact conducted a first-of-its-kind study on why people leave tech companies. What’s noteworthy is many companies track retention, but they rarely, if ever, release it.
The good news: Nearly two-thirds of employees said they would have stayed if their employer had “fixed its culture.” Kapor’s findings underscore the importance of the workplace in attracting employees and engaging them once they’re on board.
The Bay Area’s economy is squarely centered on tech, but second- and third-tier markets are not only seeing a talent shortage but an education shortage, too. Public education programs are working to meet the demand for a highly technical skill set, but a talent gap remains outside the Valley. To meet demand quickly and at a lower cost than STEM degrees, more cities are seeing an increase in coding camps and tech training programs.
Funding for U.S. tech startups dropped 30% year-over-year. They raised $44 billion in 2015 and $28.4 billion in 2016. Here’s the thing: 2015 funding totals were the highest since the dot-com boom. Investors aren’t out of money, those numbers are just dangerously unsustainable. Established firms are attracting the most capital, while startups need to prove their fundamentals sooner. A shift in funding expectations may impact your office and location strategy, as no cash influx means you’d be running lean for longer.
A new report from the Bay Area planning nonprofit SPUR aims to fix the rampant Valley congestion (see Tesla’s parking lot for a prime example) and help growing tech markets from making the same mistakes. Bay Area commuters are already spending two to three hours on the way to work, but second-tier tech markets have hope. Advice includes planning for urban sprawl, situating offices further out near public transit and offering alternative transit incentives.
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Author: Lillian Veley