It could be argued that in many parts of the country where the tech sector is exploding, there is an economic imperative for more people to participate in the lucrative career opportunities that lie in space. For populations that have historically been excluded from many wealth-creating opportunities, the stakes are even higher, as inflation and the rapidly accelerating cost of living increase financial strain.
For a variety of reasons, people of color have been consistently overrepresented in the low-wage labor market, including prejudice, discrimination, social capital deficits, and lack of access to equitable educational opportunities.
There is no doubt that money is an important factor why people can pursue careers in technology and why it is rapidly becoming an economic imperative for those with the desire and discipline to qualify for prosperity in the space to provide opportunities. Fields like engineering, IT, etc. earn between 20% and 85% more than the average salary depending on the state people are in, according to data compiled by business.org.
The focus on earned wages is most pronounced for populations that have historically been excluded from many wealth-building opportunities because they more often face the obligation to purchase major assets like homes with their own. income compared to those who are able to make these kinds of acquisitions with significant help from the wealth channeled to them by previous generations.
A recent Bloomberg article highlighted the growing number of people receiving installments or, in some cases, entire homes funded by their parents. “Parents are increasingly helping their adult children buy homes, whether that means co-signing a mortgage, giving money for a down payment or buying the property outright, according to real estate agents across the country,” according to their reports.
These are the types of wealth transfers that propel a person far beyond what they earn in their job. These transfers are often hidden, as the Bloomberg article alludes to by stating that “it is difficult to determine exactly how many buyers receive help from their parents, in part because few are willing to discuss the how they pay for a new home”.
Without the benefit of wealth transfers in life that can subsidize tuition, cars, private school payments, credit card payments, medical bills, business start-up money, housing and other major purchases; increased integration into the technology sector and other high-income industries becomes even more important.
Going from underrepresentation to overrepresentation in higher paying career fields can be a game-changer for the economic development of historically marginalized communities. This change can happen by identifying undervalued assets in these communities, starting with those who have the ability to excel in tech careers but may not know it or have the systems and supports appropriate to make it fruitful.
An inflection point is imminent in several metro areas like Miami, Austin, Nashville and Orlando. Rents in Miami, for example, increased nearly 41% from April 2021 to April 2022 according to Corelogic. Corelogic’s senior economist, Molly Boesel, was quoted in a Bloomberg article as saying that “we expect single-family rent growth to continue to rise at a rapid pace through 2022.” Cities that were once affordable to the middle and working classes may only be accessible to those with very high incomes or those who can shop with wealth passed down from previous generations. There is a window that closes quickly so that people who do not fall into these two categories or who do not already have accommodation in certain areas can secure it on their own.
For these and other reasons, infrastructure of opportunity that provides supported pathways for people to acquire the skills and social capital needed to successfully integrate into gainful employment in the technology sector should be a key economic development strategy.
Dr. Marcus Bright is a social impact researcher and strategist.