The Fairfax County Economic Development Authority is hosting what looks to be a fascinating conference, “The Creative Economy,” addressing a range of topics related to creativity in the Northern Virginia economy. Keynote speakers include Richard Florida, author of “The Rise of the Creative Class” and progenitor of the creativity craze, Tom Friedman, of the-world-is-flat fame, and Alvin Toffler, the future shock guru.
The FCEDA has posted a recent Florida work, “The Creative Compact,” online. This document boils down Florida’s latest thinking into five-ten minutes worth of reading. I highly recommend it. Florida’s work has had a tremendous influence on my own thinking, as anyone can see who makes the effort to plod through my “Economy 4.0” series. But Florida does have his blind spots.
One of the themes running through his work is the critical importance of the three “t”s in developing a creative economy: technology, talent and tolerance. Perhaps because most people intuitively understand the central role of technology and talent (human capital), Florida tends to emphasize tolerance in his writing. Creative people, he argues, flock to metropolitan areas marked by diversity and openness. His models for diversity and openness are places like San Francisco, Boston and Austin.
In “The Rise of the Creative Class,” Florida told a powerful story about his home town (at the time) of Pittsburgh. Blessed by industrial-era wealth, Pittsburgh had a number of knowledge-creating institutions, such as Carnegie Mellon University, home to one of the leading research centers for information technology. In the mid-1990s, the university spun off a promising little company called Lycos, which grew to rival Google as a search-engine phenomenon. But rather than stay in the Big Burgh, the company relocated to Boston to tap that region’s deep workforce of talented young IT professionals. Young people, he discovered, preferred cool places like Boston over comfortable but stodgy Pittsburgh. That incident helped catalyze Florida’s critical intellectual breakthrough that people increasingly choose where they want to live before where they want to work.
However, a decade later, Boston and Massachusetts appear to have problems of their own. In its 10th “Index of the Massachusetts Innovation Economy,” the Massachusetts Technology Collaborative lavished praise upon the state’s prowess in R&D, venture funding and innovation, but lamented a key weakness in its creative economy:
The availability of workers generally, and especially younger workers who can respond to the growth of innovation industries with the skills necessary to meet the demands of knowledge-driven companies, is declining. … Graduates from Massachusetts colleges and universities [leave] the state for better job opportunities and a lower cost of living elsewhere in the United States.
The problem is that Massachusetts, and the Boston region in particular, is an incredibly expensive place to live. Wealthy people can afford to live there, and so can people who already own their own homes. But young people, who haven’t accumulated hundreds of thousands of dollars of equity from the astronomical run-up in housing prices, cannot.
Massachusetts lost 33,000 residents between 2004 and 2005. Hmm. With all of Boston’s tolerance, diversity and coolness, how could that be? Well, Massachusetts housing starts, at 3.8 per 1,000 people, is one of the lowest rates in the country. In Virginia, by comparison, the rate is more than twice as high; in North Carolina, the rate is three times as high. Who gets squeezed out first when housing becomes unaffordable and inaccessible? All those hip, creative young people. Massachusetts ain’t exactly what you’d call a retirement haven — how many people do you know who move to Massachusetts to retire? — but the average age of its population is 37.7, higher than the national average of 36.4.
From my observation, Mr. Florida has given insufficient attention to the problem of affordable, accessible housing. So has Northern Virginia, which could find itself in the same situation as Boston if it’s not careful. Tolerance is a wonderful thing, but tolerance is also in the eye of the beholder. Homeowners who won’t permit the construction of affordable townhouses, apartment buildings or single-family dwellings converted into boarding houses for immigrants may not be as tolerant as they profess to be. The real test of tolerance, I would submit, is not the abstract support of cultural and ethnic diversity but in whom you actually allow to live near you.
I wonder if anyone will raise that issue in the Fairfax creativity conference.
Update: Richard Florida picked up this Bacon’s Rebellion post and responded to it on his blog, Creative Class Group. Here’s how he responded:
Actually I could not agree more. The whole last part of Flight is explcitly directed to these issues. There I argue that the world’s leading creative regions are vexed by mounting issues of economic inequality and housing affordability. I single out greater Boston as an example of region (with bad marks on both) which risks losing its creative edge over time because young scientists, engineers and scholars (as well as artists, gays and bohemians) can no longer afford to live near its great universities.I’ve also written a recent paper on housing with Charlotta Mellander (yes, the one that landed me on Colbert) which reinforces this point, though in a different way. Places with high levels of bohemians and gays are seeing housing prices rise through the roof. Jim mentions the Fairfax Conference I’ll be speaking at later this month and adds: “I wonder if anyone will raise that issue in the Fairfax creativity conference.” It was one of my pet peeves when we lived in Washington. We have the data and I promise Jim, I will raise it.
Go get ’em, Richard!
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