Tech Innovation Surges Reveal New Frontier

Thriving tech hubs, high-paying tech jobs and plenty of patents show the Midwest is far more than the Rust Belt of yore. Instead, some of its major cities are emerging as centers of innovation with much to offer tech entrepreneurs and companies seeking to advance their operational excellence.

A recent report by CommercialCafe ranked the 20 best Midwestern metro areas for tech development by several metrics. They include the local ratio of tech to non-tech businesses, tech employment, the number of patents granted, as well as unemployment rates and educational attainment. The results demonstrate the shift in the region’s capabilities.

Madison, WI came out at the top of the combined rankings with a strong performance on several metrics. It had the highest ratio of tech to other employment opportunities: 71 of every 1,000 occupations. And at around $89,000 a year, its median salaries for tech workers were the second highest in the region. In addition, 31 of every 1,000 companies in Madison is in the tech space.

Ann Arbor, MI took second place with 52.2 of every 1,000 jobs in tech, and the highest tech establishment density in the region with 46 of every 1,000 firms in the sector. Median tech earnings stood at $80,000.

Third place went to Chicago, which at 8,000 held the highest number of tech patents in the region, the largest pool of organizations and companies contributing to tech innovation, and median tech salaries of $92,300.

Other metros demonstrated their commitment to growing their tech sectors. Columbia, MO led the field with a 14% increase in tech firms between 2017 and 2021, while also growing established companies. Lansing, MI saw a 10% rise in tech companies, and Springfield, MO recorded 9% growth.

In terms of job growth – distinct from company growth – Rochester, MN led the way with a 47% increase in tech employment between 2017 and 2021. Lansing followed, rising 45% with the help of a statewide push to recruit tech companies. Other metros with rapid employment growth were Des Moines (up 32%), Detroit (up 26%), and Indianapolis (up 25%). In terms of the sheer number of workers, Detroit came in tops with 80,000 new jobs.

The highest-earning metro, Chicago, was followed by Madison, then Minneapolis with median income of $87,000. Surprisingly, the relatively small town of Rochester, MN came in fourth at $84,000. “The most spectacular percentage increase” between 2017 and 2021 was enjoyed by Sioux Falls, SD, where median tech salaries rose by $20,000 in the period, helped by the growing biotech industry, CommercialCafe stated. Columbia, MO, Madison and Springfield, MO saw median wages increases between 27% and 32%.

Ranked by the all-important issue of patents, Chicago took the crown in the Midwest, being awarded 8,243 patents between 2018 and 2022. The pandemic year 2020 was especially fruitful. Detroit won over 6,000 patents to come in second. The third highest number – 3,000 – went to Minneapolis.

Chicago also recorded the highest number of organizations receiving patents, with 773 involved. That was more than 77% more than runner-up Minneapolis, and more than double the 300 recipients in Detroit.

However, for researchers and companies seeking quality of life, the city to investigate may be Columbia, MO. “Columbia managed to lead the life-quality index by earning the second lowest cost of living and the third highest number of residents over 25 years with a bachelor’s degree or higher. The metro also had a 2.5% unemployment rate,” CommercialCafe stated. Others may prefer Fargo, ND, which came in second by a slim margin.