“... The COVID-19 pandemic will encourage people — entrepreneurs, investors and employees — to consider opportunities outside of the coastal tech hubs. People who have been considering a move, to tap into the sector expertise that exists in many parts of the country, or for a lifestyle change, or to be near family and friends, may choose this moment to relocate, accelerating a talent boomerang, and helping emerging startup cities rise.” — Steve Case, tech entrepreneur and investor
The economic and employment crisis in our local services industry is difficult and personal, albeit unavoidable during this unprecedented time. Almost everyone likely knows someone who has lost a job at a restaurant, bar or hotel, probably more often than knowing a victim of the virus. Much credit is due to the local industry’s stellar internal support and creative thinking that’s helped ease the pain. The industry is showing admirable grit and resolve.
While we all want our hotels, restaurants and attractions back as soon as possible, we were heartened to see Mayor John Tecklenburg’s 3 Step recovery plan call to embrace a multifaceted economic development strategy, with a focus on “delivering more resilience through greater diversity.”
In particular, continuing to develop a robust tech and digital sector is not only wise but especially timely and necessary given the circumstances. Indeed, Charleston is well positioned to take advantage of trends being accelerated by COVID-19 and that line up well with the needs of an innovation economy:
• Flight from big cities. The pandemic has caused many urban dwellers to rethink the appeal vs. the risk of living in crowded areas, which are costly and, during times like this, more susceptible to health risks. Factor in high costs of living and quality of life, and Charleston becomes even more appealing in the post-pandemic world.
• The proven value of remote and distributed working. The number of people who work remotely has been growing steadily, but the virus forced a new wave of workers out of their offices. It has shown that technology enables dispersed teams to work productively from virtually anywhere.
• The rise of the digital entrepreneur. Today’s innovation economy is not defined by physical constraints the way hotels and restaurants are. Barriers to entry for a digital entrepreneur are much lower than a brick-and-mortar business, and the value created is more fluid and can be orchestrated from just about anywhere. A recent study showed that not only is the traditional clustering of tech firms in “superstar” cities a diminishing trend but smaller communities tend to benefit more from small tech businesses.
Other trends augur well for doing even more to position Charleston as a partner in furthering its tech ecosystem.
Great progress has been made at the city, regional and state levels. One need only look to the success of the Charleston Digital Corridor to see the potential of developing a tech community that can fuel more growth. The Digital Corridor is a good bellwether for local tech. Among its most telling statistics is the rise in average tech salaries — reaching $93,000 a year in 2019, double that in other local industries.
Hospitality and tourism will always be the heart and soul of Charleston. But this crisis has shown us the danger of becoming too reliant on one engine. Having other resilient economic drivers will help accelerate the recovery of our bread-and-butter industries. Investment and growth in other sectors provide Charleston with needed diversity that can help us weather storms and strengthen our economic foundation for the long term.
Mike Sottak is a technology marketing and business development professional and entrepreneur. He has consulted with national economic development initiatives in Europe and advised dozens of tech start-ups on marketing and growth strategies.