Chapter 5

What are the highest- and lowest-cost markets to operate in?

Scoring Tech Talent 2025

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Employee wages are the biggest cost for tech companies. Highly skilled and educated tech workers often command more than double the average non-tech salary.

The San Francisco Bay Area ranked highest for average tech worker salary at $193,000 per year, about $33,000 more than Seattle, the next highest market. The average tech worker salary in 17 of the 50 top tech talent markets was at or above their respective national average (13 U.S. and four Canadian markets).

Office rent is the second-biggest cost for most companies. Even though fully remote and hybrid work are common, companies understand the benefits of tech clustering and often place a higher value on specific submarkets and even specific streets convenient to tech talent. Manhattan has the highest average office rents, followed by the San Francisco Bay Area, South Florida, Austin and Boston.

Combining wage and real estate costs provides a benchmark of what a tech company might pay to operate in any of the top 50 tech talent markets. For this comparison, U.S. occupational averages were analyzed to determine the makeup of a typical 500-person tech company (Figure 33) using 60,000 sq. ft. of office space.

Local market wages were applied to the various occupations to determine total annual wage costs by market, while local market rents were used to estimate the annual cost of renting a 60,000-sq.-ft. office to house 500 employees. The San Francisco Bay Area topped the list with the highest estimated annual cost in 2024 at $87 million, followed distantly by Seattle, New York Metro and Boston.

The lowest cost markets were all in Canada, with Edmonton the least expensive at $35 million (Figure 34). Since tech industry wages are 18% higher than the U.S. average, tech companies can expect higher annual costs. The 50-market average annual cost exceeded last year’s by $1.5 million, almost entirely due to wage increases.

Figure 33: Average U.S. Tech Company Occupation Pools*

Source: U.S. Bureau of Labor Statistics, May 2025.
* Excluding high-tech manufacturing.
** Tech Talent includes the following occupation categories: software development & programming, computer support, database & systems, technology & engineering-related and computer information system management.

Figure 34: Estimated One-Year Company Costs by Market (500 Employees; 60,000 Sq. Ft. of Office Space)

Source: U.S. Bureau of Labor Statistics, Statistics Canada, CBRE Research, 2025.
* In US$
** New York office rent cost represents Manhattan only, all others are metro area.
1 Average Rent × 60,000 SF
2 Average Wage × 257 People
3 Average Wage × 166 People
4 Average Wage × 77 People

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Chapter 6 How is Tech Talent quality vs. cost measured?
Chapter 4 How diverse are Tech Talent markets?