San Antonio’s tech sector advocacy group Tech Bloc released the first report in almost a decade surveying the size and impact of the city’s tech economy.
The report showed a growing, $10.8 billion industry, where a majority of workers are employed at non-tech organizations and company hubs are dispersed throughout the city’s suburban ring.
The new insights arrive as Tech Bloc looks to evolve beyond its downtown-centric focus for building up San Antonio’s tech sector, and take advantage of remote work trends in a world reshaped by the pandemic.
“Building a vibrant, tech neighborhood downtown will always be a pillar for us,” Tech Bloc CEO David Heard said. But, he added, the organization has undergone a realization: “There are some things we might do to promote tech in other areas of town, where it exists in greater numbers, and where we haven’t focused as much.”
What exactly that looks like is yet to be determined, Heard and other organization leadership said. Tech Bloc plans to host a retreat for board members that will focus in part on how to best capitalize on pandemic-era trends.
Since 2015, Tech Bloc has trumpeted the cause of developing a “tech district” downtown featuring parks, rideshare scooters and startup accelerators. That effort, which has helped realize developments like Geekdom’s new cybersecurity accelerator and the 2020 opening of Legacy Park downtown, has had an impact, according to the report.
It found that downtown — while far from the city’s biggest cluster of tech workers — is the fastest growing hub in the city, and is home to the largest concentration of tech companies, many of them startups.
The biggest hub for tech sector employment in the city is actually Port San Antonio, which is where Tech Bloc chose to announce the results of its report. The second largest hub doesn’t even have a real name, Heard said in his address, and is centered along a northern corridor of U.S. Highway 281. Heard’s own firm, SecureLogix, is located there.
Downtown ranks as the eighth-largest hub for San Antonio’s 48,000 tech professionals.
The city’s suburban tilt for tech workers largely stems from the fact that just over 20,000 work for tech-focused companies. The majority work as IT professionals for large corporations, like USAA and H-E-B — or for the federal government.
The nearly 16,500 IT professionals in San Antonio who work for the federal government or its contractors in the defense and cybersecurity space represent a sizable chunk of the tech sector workforce that hasn’t previously been counted by researchers because the state doesn’t track federal jobs.
The report also pegged the estimated annual economic impact of San Antonio’s tech industry at $10.8 billion, up from $8.8 billion in 2015 and $8.5 billion in 2010.
That recent growth is “not spectacular,” said Richard Butler, one of two Trinity University professors whose research fueled the report, but he said some sectors have seen higher growth, such as the computer-products oriented sector — like software development — which accounts for just over half of the economic impact, but only a quarter of tech employment.
The report also said that compared to its economic impact, total employment in tech-focused companies has “grown more slowly.”
Heard wants to boost tech employment dramatically.
“We need to double the size of the tech workforce in 10 years,” Heard said — a rate that would far exceed the previous decade’s growth. “The future economy will continue to be driven by tech. Our city needs to be a part of that.”
But the number of startups, though they typically employ a smaller number of workers, has been on the rise. According to the report, the number of companies in San Antonio’s IT industry has grown 36%, from nearly 1,100 in 2015 to nearly 1,500 in 2020.
Many of these startups are located downtown.
Dirk Elmendorf, Tech Bloc’s chair, said Tech Bloc leadership met in March 2020 in a conference room at the newly built Frost Tower downtown to discuss how it could build on downtown’s growth. Discussion revolved around parks, accelerators and getting venture capital downtown.
But the pandemic and its lockdown, which arrived a week later, showed the liability of that strategy — as well as opportunities beyond it.
“The world of, everybody is all together in one small place — it doesn’t seem to be as helpful anymore,” Elmendorf said Wednesday.
Lockdowns prompted organizations like USAA to send its thousands of downtown employees to work from home. Geekdom saw its membership numbers take a dive, from which it is still recovering.
But that dispersal appears to have expanded opportunity for San Antonio.
The city’s tech industry actually grew at an accelerated pace during the first part of the pandemic, a new report from the Brookings Institution found earlier this year. The development followed a nationwide trend in which tech jobs, usually concentrated in a handful of tech-heavy cities, spilled out into metropolitan areas not normally known for robust tech sectors. This is the result of remote work.
Heard said he recently discussed the prospect of remote work with Bexar County Judge Nelson Wolff. “The county does a lot of economic development incentives,” Heard said he told Wolff. But these days, he said, recruiting workers may be just as important.
“If these workers can choose to live anywhere, how do we get them to choose here?”
The article has been updated to correctly reflect Legacy Park’s opening in 2020.
