Here’s why more millennials are still living with their parents
Reputations die hard and for Sacramento it’s been especially hard to get rid of some of its more inaccurate ones, said president and CEO of the Greater Sacramento Economic Council Barry Broome.
“There’s only one restaurant ... it’s so hot in the summer I can’t understand how anyone could live there, you can’t get a drink in your town,” Broome said, rattling off gripes he has heard more times than he can count. “If I were to give you the top 10 insults, you’d be mad.”
But a new report by real estate services company CBRE and the council validates some of what economic experts and officials have said about the Sacramento region for several years: It’s flush with higher education options, ripe for business opportunities and attractive to young millennials looking for an affordable California city to settle down in.
“We have a better workforce and higher education story than Seattle, Denver, Austin, Portland,” Broome said.
The message to company executives: “If you’re going to invest in California, you should invest in Sacramento,” he said.
Data points aggregated by the study include:
▪ Sacramento gained about 6,680 millennial residents last year, making it the third most-popular landing spot for millennials last year.
▪ Among Sacramento college graduates, about 53 percent have STEM degrees.
▪ Sacramento ranked No. 6 among small tech markets out of 50 major markets in North America.
▪ The region leads the nation in terms of women-founded businesses, tied with Los Angles – one in four companies in the Sacramento region are started by women.
The report is the first time a major private real estate company has “helped us tell our story,” Broome said. It’ll be a key document the group can use as it courts businesses across the West to move to the region.
The report touts Sacramento’s relatively low housing prices when compared to the Bay Area: The median home price is around $409,000, and the average rent is about $1,210, according to the report (though prices are rising).
In addition, nearly 755,000 students are enrolled in two-year and four-year schools within 100 miles of Sacramento. With many of those students studying STEM fields, the region has a natural pipeline that infuses the job market. About 42 percent of the region’s graduates stay, employed largely in the healthcare and technology companies.
And the idea that the capital city is exclusively a government town is also waning – in the last 10 years, dependence on government jobs has declined from 27 percent to 22 percent, according to the report.
The report comes as hundreds of companies leave the state each year in search of lower business taxes, affordable housing for employees and a larger talent pool – a missed opportunity for Sacramento, Broome said. About 1,800 companies left California in 2016 for a better business climate, according to an analysis released last year.
Cities such as Seattle, Denver and Nashville have been working on their reputations for years, Broome said. For Sacramento officials, now it is a game of catch-up. Though the region is generally well received by companies looking to move out of Los Angeles and Seattle, Broome said, Bay Area companies need a little more convincing.
The CEO and the chief innovation officer of one Silicon Valley company once told him “they would rather jump into the Bay than move their company to Sacramento.”
“This is a report I can now send to chief human resource officers of every company and they can say what they want to say, but they can’t deny this report showing it’s a region with young millennials and young talent and elite talent,” Broome said.
With the new report, the Greater Sacramento Economic Council will soon begin an online marketing campaign to recruit prospective talent to the region. And in November the council will host a group of national site-selection consultants, who are used by Fortune 500 companies before making investments in new markets.
Still, data and charts can only go so far. Big flashy developments, such as a Major League Soccer team coming to Sacramento and the major UC Davis tech and medical center campus Aggie Square, are also important signals for companies looking at a new home.
For example, all the metrics indicate that Bay Area-based life science company Broome is in talks with should move to Sacramento. But a company executive is convinced Sacramento isn’t any fun.
How do you change their mind? Perhaps a Dave Matthews Band concert.
“They say, ‘Don’t even bother with Sacramento,’ but get them to a Golden 1 concert, they go, ‘Huh, this really great,’ ” Broome said. “And get them to Revival, that super cool bar, and everyone is in their 20s and 30s, and it feels like you’re in Manhattan.”