Wall Street is colliding with Main Street in a whole new way. Thanks to low taxes, telecommuting innovations, and more-bang-for-your-buck quality of life, financial service jobs are growing quickly in unexpected places. The financial industry is adding jobs in places like Nashville and Phoenix at a faster rate than in traditional capitals of finance like NYC. Though banks are consolidating, they are increasingly locating only their headquarters in the major cities, while sending their workforce out to the Sun Belt, from which they can telecommute. Joel Kotkin has more in New Geography:
These smaller cities have advantages for both the financial institutions and their employees. For one thing, the cost of employees is much lower. According to salary reporting website Payscale.com, the median financial manager in New York or San Francisco costs $90,724 to $98,783, respectively; while one in Phoenix costs only $77,467.But this is not just good for the companies. Employees who make less in St. Louis, Phoenix or Dallas often live far better than their counterparts who earn higher salaries in the traditional money centers. One big reason is housing costs, which are a third to half cheaper in the top cities on our list than in places like Boston (2013 median home price of $375,900) New York ($465,700), or San Francisco ($679,200). Compare that to $183,600 in top-rated Phoenix or $171,000 in San Antonio-New Braunfels.
Telework allows people to form more integrated work-life communities in the suburbs as well as the city and allowing talent to settle wherever it wants while still staying plugged into the wider world. Telecommuting young people now have the the opportunity to improve their quality of life by moving into cheaper areas or even going abroad. There are many ways to help this transformation along, and we’d be excited to see it pick up steam.