Florida dreaming

Is the Creative Class coming or going?

Illustrations by Elizabeth Rock

In The Rise of the Creative Class, economist Richard Florida wrote that gays are good for a region’s economy. In his new book, The Flight of the Creative Class, he tells us that immigrants are even better — and America is in danger of getting a lot fewer of them.

The point of Florida’s first book was not that cities benefit from a high number of gays and lesbians per se, but that tolerant attitudes and a diverse population attract well-educated, highly skilled workers in “creative” occupations (not just artists but also scientists, engineers, and entrepreneurs of all types). According to this theory, Indianapolis does not necessarily have to be as bohemian as San Francisco to make it in the New Economy, but it cannot be perceived as hostile to gays or other minorities. Flight of the Creative Class, by contrast, suggests that it is not enough to be perceived as tolerant of immigrants; a region must actually attract them in large numbers. And Florida warns that a combination of factors, some of our own making, are pushing highly skilled workers away from America.

“Terrorism is less of a threat to US society than the possibility that creative and talented people will stop wanting to live within its borders,” he writes. For those still celebrating the end of the Cold War, confident that no rival can match America’s economic might, Florida adds, “no one country or one region needs to trump us; the more likely scenario is a death by a thousand cuts as a series of competitors collectively combine to erode our lead.”

Rise, published in 2002, gave hope to Massachusetts, which boasts the best-educated workforce in the nation and is one of the most diverse states in the US. Flight is more likely to cause night sweats. It tells us that we’re in danger of losing our best and brightest to not only Austin but also Australia. And it raises the possibility that, after a century or two of sending many of its hardest-working natives to Boston, Dublin may finally get its revenge.

uch of The Flight of the Creative Class is a defense of Florida’s first book, in which he argued against the widespread belief that sunshine, cheap land, and low taxes would determine which regions of the US would prosper over the next few decades. More important, he wrote, are the “three Ts” of technology, talent, and tolerance, characterized by the presence of high-tech industry, a highly educated workforce, and a diverse population (measured by, among other things, the number of same-sex “unmarried partners” counted by the US Census). That book also included the cautionary note that, even if some American cities do better than others at maintaining an attractive atmosphere for creative workers, the nation as a whole may be falling behind some underestimated rivals. (Referring to Toronto’s integration of ethnic groups and economic classes, Florida wrote, “true intermixing of this nature is very hard to find in the United States.”) In Flight, he explicitly states that certain factors, particularly immigration laws, could hobble all regions — which would make all those surveys on the best cities in the US to live or start a business seem beside the point.

Though Florida acknowledges that immigration is of particular benefit to America’s creative professions (he quotes New York Times columnist Thomas Friedman, who has written that “one of America’s greatest assets [has been] its ability to skim the cream off the first-round intellectual draft choices from around the world”), he stresses the value of newcomers from all economic and educational levels. “Low-skilled immigrants have helped to propel the American economy,” he writes, in part because some of them turn out to be successful entrepreneurs (or the parents of entrepreneurs, such as the Cuban-born father of Amazon.com founder Jeff Bezos) and in part because immigrants at all educational levels can have different skills than those of their American counterparts and thus fill different employer needs. His conclusion is that a slow trickle of immigration is not enough; there is strength in numbers.

If this is so, the US has been heading in the wrong direction since the terrorist attacks of 9/11. According to Florida, the rejection rate for H-1B visas, which allow non-citizens to work in the US for up to six years, rose from 9.5 percent to 17.8 percent between 2001 and 2003. He also notes that the total number of applications for all US visas fell from 6.3 million in 2000 to 3.7 million in 2003. In addition, Florida provides anecdotes about scientists, scholars, and entertainers finding it more difficult to gain entry into the US for even a short visit, as well as conference organizers now boycotting the US because of increased restrictions on international travelers. Even more alarming are Florida’s stories about people who are already ensconced in America but want to get out — from film director Peter Jackson, who relocated his operations from Los Angeles to his native New Zealand, to an English as a Second Language instructor in Houston, who complains in an e-mail, “The people here focus on nothing else but sports. The city keeps building stadiums, we have four new ones.”

Florida’s point is that the US can’t count on being the mecca for the highly educated forever, especially as people of talent around the world gain more options to choose from. “The elite of any society have…always been highly mobile,” he writes. “What’s distinct about our times is the extent to which more and more people are developing the cultural, political, and economic freedom to choose where to live and work globally.”

But it may be tough to get political leaders to share Florida’s concerns about a “reverse brain drain” in the US. For one thing, there’s something less-than-patriotic about the idea that America doesn’t have enough homegrown talent to maintain its economic edge. (I can hear the calls to improve our educational system rather than let in more foreign-born workers, though in the short term that strategy may not keep impatient employers from relocating abroad.) Then there are national security concerns, fears that native-born Americans will face increased competition for jobs, and worries about overcrowding and strain on social services in the cities and regions that attract the most immigrants. There will be a temptation to restrict immigration to a select group of highly skilled workers, precisely what Florida warns against.

Immigration has been a relatively little-discussed issue in recent elections, but that may be changing. On the Re-publican side, US Rep. Tom Tancredo, of Colorado, has organized a 70-member Congressional Immigration Reform Caucus (with only two Democrats and no members from the Northeast) and called for a “time out,” or a major reduction in legal immigration, though this view doesn’t seem to have support within the Bush administration.

As for Democrats, Dave “Mudcat” Saunders, a political consultant best known for helping to elect Gov. Mark Warner of Virginia, says that a hard line against “illegal aliens” — and he stresses that phrase instead of the softer “illegal immigrants” — could greatly improve his party’s standing among rural voters. “If the Democrats put illegal aliens in their bait can,” he told CQ Weekly columnist Craig Crawford this spring, “we’re going to come home with a bunch of white males in the boat.” Saunders may be talking about “illegals” rather than immigrants who go through the proper legal channels, but that distinction may not mean much to creative types trying to decide whether Boston or Melbourne has a more welcoming atmosphere.

Of course, xenophobia is not a uniquely American phenomenon. Florida cites a 2004 survey showing that, in addition to a majority of Americans, most people in Britain, France, Germany, Japan, and several other nations also saw immigrants as a “bad influence” on their respective societies. “Only Canada, of the nine nations surveyed, had a generally positive view of immigrants,” he notes.

Unfortunately, this survey was limited to a few large nations with advanced economies. It would be interesting to see whether India and South Korea, which include cities that Florida identifies as “regions on the rise,” are any more tolerant of immigrants. For the most part, these countries have developed high-tech hot spots by keeping their own skilled workers at home, not by importing large numbers of skilled workers from abroad. Do they need to increase immigration in order to remain players in creative economy, as Florida says is the case with the US, and are they likely to do so? If immigration is restricted in countries all over the world, perhaps as a backlash to uncertainties of the global economy, the US may not be at such a disadvantage after all.

ut the Bay State would clearly suffer from reduced immigration. If not for immigrants, Massachusetts would have registered population losses during the 1990s and perhaps during the 1980s as well. In 2004, Massachusetts ranked 10th in the share of its population — 14.3 percent — that was foreign-born or born in Puerto Rico, according to Northeastern University’s Center for Labor Market Studies. (See the MassINC report The Changing Face of Massachusetts.) From 2000 through 2004, according to Census figures, the Bay State had a net gain of 137,000 people from international immigration; during the same period it suffered a net loss of 173,000 as a result of migration to and from other states.

This dependence on foreign-born workers is nothing new for Massachusetts. Indeed, the immigrant share of total population in the 1890 Census is a rough guide to the placement of Florida’s creative class more than a century later. Among states that were mostly settled before the end of the 19th century, those with high immigrant shares (including Massachusetts at 29 percent, Minnesota at 36 percent, New York at 26 percent, and Rhode Island at 31 percent) now have high concentrations of creative jobs, while those with lower shares (Indiana at 7 percent, Ohio at 13 percent, and Pennsylvania at 16 percent) still lag in the development of a creative sector.

Though fewer in number, immigrants have become more important for Massachusetts today. The Bay State is one of only seven states in which the number of immigrants from 2000 to 2004 is larger than both the number of newcomers from other US states (a negative number, in our case) and the “natural increase” calculated by subtracting deaths from births. Another thing we have in common with the other six — Connecticut, New Jersey, New York, Oregon, Pennsylvania, and Rhode Island — is a habit of voting Democratic in an era of Republican dominance of national politics, which doesn’t bode well for our ability to shape national immigration laws in a way that benefits our state’s economy.

In a worst-case scenario, Flight of the Creative Class could cancel out all the good news for Massachusetts found in Rise of the Creative Class, since the “non-creative” regions in the US have the political power to force all regions to comply with laws based on their own attitudes toward the foreign-born — even if they fail to force the entire country to adopt their attitudes toward gays and lesbians, non-Christians, and other minorities. “Whatever country manages to attract…highly mobile students,” Florida writes, “will have a huge long-run advantage in the burgeoning global competition for talent.” Massachusetts leaders may wish that they could replace “country” with “state” in that sentence.

lorida does not say that the worst-case scenario is inevitable, but even if there is continued growth in America’s creative class, it is not likely that the growth will occur evenly among individual cities and regions. So he restates his central idea from Rise of the Creative Class — a book that has inspired the governor of Michigan to attempt the development of “cool cities” in her state — even as he hedges on its practicality. “Courting divergent ideas and inputs isn’t about political correctness; it’s an economic growth imperative,” he writes in his second book. “My research finds a strong correlation between, on the one hand, places open to immigrants, artists, gays, bohemians, and socio-economic and racial integration, and, on the other, places that experience high-quality economic growth.”

Note that word “correlation.” Florida is not bold enough to say the relationship is one of causation, and some of his critics argue that job growth leads to a diverse population, not the other way around. One of his most persistent critics is urban historian Joel Kotkin, who before debating Florida at a conference in Colorado this spring told the Denver Post that “his whole shtick is based on arts and creativity as the center of everything. There’s something very narcissistic about [it].”

At about the same time that Flight of the Creative Class was released, Kotkin authored a piece for Inc. magazine on “The Best Places for Doing Businesses in America 2005,” and Massachusetts cities didn’t make a good showing at all. Among the 274 metro areas that Kotkin considered, Brockton ranked 109th, Worcester 151st, Springfield 164th, Lowell 187th, Boston 203rd, Pittsfield 249th, and New Bedford 253rd. Top honors went to Reno, Nevada (a mere half-hour by air from arts-oriented San Francisco, and boasting “cheap and reliable electrical power”); Boise, Idaho (“pro-business political climate”); and Casper, Wyo. (“no state income tax…and cheap living”).

“These smaller cities are proving ideal places for doing business,” Kotkin writes, “especially in a globalized economy in which companies operate under relentless pressure to keep costs low and quality high.”

Perhaps with Richard Florida in mind, he profiles an entrepreneur (born in Finland) who relocated a software company to Reno while keeping a “diverse, multicultural workforce.” In contrast, Kotkin writes that Philadelphia may have succeeded in attracting “a growing community of singles, gays, and childless couples,” but it’s still hampered by high taxes and “crummy public schools.” He then quotes a professor of real estate: “Philadelphia can’t adjust to a high-mobility world where people can simply go somewhere else.” That’s a pretty neat trick: Kotkin uses the thesis of Florida’s second book to discredit the thesis of his first one.

Florida himself muddies the waters in defending his first book. “Certain critics…blanch at the connection between gays and bohemians and growth,” he writes, and he cites Kotkin as an example of someone who implies “that a place must either be family-friendly or gay-and-bohemian-friendly, suburbs-driven or city-oriented.” But he’s attacking a straw man here. I can’t find any evidence of Kotkin, or any prominent economist or sociologist, arguing that a large gay population hurts a region, only that such a population is of little use in reviving an economy. In a recent article on The New Republic’s Web site, Kotkin does argue that cities such as Boston are putting too much faith in demographic groups that won’t necessarily stick around, including recent college graduates (“many educated people come to the cities for a relatively brief period of their lives, notably their twenties”) and immigrants (who head “out of town” and into the suburbs as they accumulate wealth), but he never says that such groups are pushing families or native-born Americans away. And Kotkin does not argue that economically healthy regions must be driven by suburban growth, but that such a phenomenon is occurring — like it or not — as we search for a long-term strategy on how to revive our central cities.

And Florida only makes Kotkin’s case when he points out that McAllen, Texas, and the California cities of Fresno and Riverside — all areas cited by Kotkin as high-growth areas — may be “family-friendly” but also rank highly in the percentage of households with children headed by gay parents. Since there are no data on the number of gay-headed households in these places 20 or 30 years ago (the US Census began counting “same-sex unmarried partners” in 1990 and has never counted gay singles), one has to wonder whether, as Kotkin and others suggest, job growth leads to a diverse population rather than the other way around. It’s possible that, notwithstanding all the lists of “America’s best cities” (including Kotkin’s) in popular magazines, people do not make entirely rational decisions on where to live and do not carefully weigh such factors as the average price-per-square-foot of housing or the number of whole-food groceries per capita. Perhaps they simply go to the first city they encounter with enough jobs, a short enough commute, enough affordable housing, and just enough of a bohemian atmosphere for their own needs. (As Florida admits, “The creative age is giving rise to a whole host of…externalities, running the gamut from growing housing inaffordability and worsening traffic congestion to mounting stress and anxiety.”)

Florida may be correct that intolerance is bad for business. There was evidence of this during the civil rights movement, when Atlanta, which called itself “the city too busy to hate,” amassed economic power at the expense of more defiantly segregationist Southern cities. But it doesn’t necessarily follow that each step upward in tolerance and diversity brings a new economic advantage. There may be a tipping point, past which a metro area has enough to offer — enough Thai restaurants, art galleries, and gay bars — for young creative types to move there. It’s also possible that cultural liberalism in the US is advancing to the point where just about every metro area has a core city that qualifies as “cool,” even if the surrounding suburbs remain strongholds of traditional values. (In recent visits to Charlotte, NC, and Roanoke, Va., I talked with several creative workers, some of them gay and some of them transplanted Northerners, who were satisfied with the diversity and arts scene within the city limits — and quite enthusiastic about the warm climate and relatively low housing prices.)

Let’s assume that the three Ts of technology, talent, and tolerance determine which regions will prosper in the future, and even that a limited number of regions in the US will meet Florida’s criteria — in other words, that tolerance and diversity will not take root in all urban areas, and thus will provide advantages to some regions that outweigh the low cost of living in others. How would Massachusetts do under these conditions?

Though Massachusetts is famously liberal in terms of national politics, there is a lingering perception of provincialism and racism here — and, ironically in view of Florida’s first book, the state has a reputation among gays and lesbians as being frosty toward newcomers. And even overcoming this perception may not be enough, for tolerance is not necessarily the same as openness to new ideas.

Consider Florida’s knock on his native Pennsylvania in The Flight of the Creative Class. Explaining why the Digital Revolution took place in California rather than in the Midwest, he writes: “Imagine the long-haired, bearded, sandal-wearing [Steve] Jobs and [Steve] Wozniak, à la 1972, showing up at Mellon Bank in Pittsburgh with their new invention, the personal computer, in tow; would they have made it past the security guards at the front door?” Probably not, but how far would they make it into a Boston bank in 2005?

At another point, Florida turns to Jane Jacobs to help describe the energy in creative cities: “What distinguishes thriving cities from those that stagnate and decline is a group of people she calls the ‘squelchers.’ Squelchers, she explains, are those political, business, and civic leaders who divert and derail human creative energy by posing roadblocks, acting as gatekeepers, and saying no to new ideas, regardless of their merit.” I don’t know how many squelchers there are here — they’re a lot harder to count than college graduates or same-sex couples — but that description sounds familiar enough from an earlier, stodgier era of Boston’s history. How much we’ve put that behind us is an open question. Besides, there is more than a touch of elitism in the idea that cities with well-educated, diverse populations could not be run by arrogant know-it-alls.

Florida never considers the possibility that places like Massachusetts could be tolerant and close-minded at the same time, but he does talk about one form of exclusivity that seems to be worst in the coolest cities: the cost of living in them. “Places like Silicon Valley…; Cambridge, Massachusetts; and even New York City used to be places where young creatives, new immigrant families, social and economic outcasts, and intrepid entrepreneurs could go to get a start,” he writes. “But these places now number among the nation’s least affordable housing markets.”

Referring to the older metropolitan areas that he cited, in Rise of the Creative Class, as having growth potential, he warns, “There are those who own property, and those who can’t buy into the system. Caught somewhere in be-tween are the young but not yet established scientists, engineers, and other creative types these cities will need for long-term growth.” Many creative cities outside of the US are facing a similar dilemma (notably London), but Florida suggests that many other metro areas (such as Dublin, Sydney, and Toronto) may be able to capture American-born workers priced out of housing markets here. A reader in the Bay State is left with the uneasy feeling that it might be easier to raise tolerance levels in Fresno and Oklahoma City than to lower housing costs in Boston and San Francisco.

Indeed, Florida all but says that creative types in these expensive cities should get ready to move elsewhere — notwithstanding his praise of the Boston region as a “Leading Creative Center” in his first book. One way to address income inequality and housing inaffordability in high-tech regions is “to invest more in other cities around the country,” he writes. “Bringing a wider number of regions into the creative economy will help to take the pressure off the leading creative centers.” One has to ask: How much “pressure” can be taken off a city like Boston and still have it be a leading creative center?

Florida says that “older cities are the perfect places to build further extensions of the creative economy,” owing to their ample supply of vacated factories and warehouses. This thought might cheer civic leaders in Pittsfield and New Bedford, much as Rise of the Creative Class gave a friendly pat on the back to Boston. But it’s hard not to worry that entrepreneurs are more likely to take Kotkin’s advice that they start from scratch in Reno or Boise. Even Florida, despite his general approval of the Jane Jacobs belief that tightly packed cities are good for the creative process, cites film director Peter Jackson’s insistence on working in New Zealand rather than Los Angeles and warns, “Density and spontaneous interaction are important elements of creative development, but not if they are tethered to too many complications — especially basic safety concerns such as unusable nighttime streets and crime.”

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uoting the late economist Mancur Olson, Florida warns that “hegemonic” nations such as the current-day US can “become so dominant that they get fooled into thinking they know best.” Fairly or not, that phrase — “thinking they know best” — evokes a certain stereotype of Massachusetts. If the state does suffer from a smug sense of superiority, The Rise of the Creative Class did nothing to discourage it. Citing the advantages of a well-educated population and a wide variety of ethnic restaurants, Florida’s first book may have led some people to think that the Boston area has a charmed existence. We’ll always have Harvard and MIT, the reasoning goes, and we’ve got possibly the best-educated and most culturally liberal population in the country, so how can we lose? The Flight of the Creative Class tells us exactly how we can lose, both to other American regions and to fast-developing (and increasingly cosmopolitan) nations all over the globe.

On the other hand, buying into the arguments of Florida’s fiercest critics would send Bay Staters from complacency to defeatism. After all, if good weather and cheap living are the only keys to economic growth, we can’t possibly win. The theory of the three Ts, though battered somewhat since Florida introduced it three years ago, may still represent our best hope for long-term prosperity. The problem is that our ability to maintain a talented, diverse, and creative population depends on some factors over which we have limited control (housing costs, traffic congestion) and others over which we have virtually none (immigration laws, the global reputation of the US). Solving these complications is a lot trickier than putting out the welcome mat for gay college graduates and computer programmers from Asia.