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Breaking Down Boston’s Biotech Valley

Recent employment statistics strengthen the case for Silicon Valley’s upcoming biotech equivalent in Boston

The space of highly successful private companies in the recent decade has been dominated by Silicon Valley and information technology, almost to the point where IT and FAANG have become synonymous with the public conception of “tech.” Especially considering the recent round of IPOs for several Silicon Valley IT behemoths, this might be a good time to contemplate the future of engineering and technology in terms of other industries conceived as high-tech: areas such as materials science, genetics, healthtech, nanotechnology, and other overlapping areas.

One contending field of growth is biotechnology, which has begun to make its way into popular news and culture due to lucrative deals if not for the scientific breakthroughs themselves.

So where might an upcoming center of biotech in the U.S. be — in the same way Silicon Valley honed the eventual creations born out of silicon chips? A general analysis of history suggests that, for such centralization, the most important factors to be the specific concentration of domain individuals, intellect, and institutions. Greater Boston has been highlighted as a potential candidate for these reasons, so in this piece, we’ll be comparing statistics between there and Silicon Valley. We’ll consider factors including not only biotech development, but also the traditional dominance of IT, as well as the upcoming trends and challenges for these fields — both will undoubtedly have impactful and intertwined effects on the world at large.

The Current State of Affairs

First we’ll visualize the job distribution in the SF Bay Area and Greater Boston. Industry employment statistics are organized by NAICS (North American Industry Classification System) industry codes. A mix of eight codes roughly correspond to our definition of “high-tech” being manufacturing or development related to software, biotech, scientific research, engineering, and materials sciences (nationwide, this represents around 5–6% of the workforce). Graphs featured in this article are accessible here.

Silicon Valley

We’ll use labor market data published by the state of CA on 2018 3Q employment distributions in the SF, San Mateo, and Santa Clara counties, which we’ll call SV. Computer technology and software, which we shall label as IT, are the first five categories, with the biosciences being roughly covered by the latter two. A total 448,624 high-tech jobs are represented, with “IT” comprising 81% at 361,581 jobs and “biosciences” being 13% at 60,092 jobs. The architectural and engineering industries make up the remaining 6% with 26,951 jobs.

In Silicon Valley, IT seems to reign at large, not to mention the upcoming growth and activity of giants like Airbnb, Uber, and Lyft as well.


Boston

Sourcing from the MA state government and using the same NAICS codes, the total number of such “high-tech” jobs in Greater Boston (Boston + Cambridge) is 104,976 compared to Silicon Valley’s 448,624.

However, versus SV, biotech in Greater Boston is twice the raw number of jobs and almost three times the percent share of the market; 37,894 biotech jobs represent 36% of Boston’s overall high-tech job market, whereas SV has 60,092 biotech jobs representing 13% of its share.

Trends and Venture Investment

The global rise of biotech venture funding might be a positive signal for the industry’s time to shine —Crunchbase reports that biotech startups globally raised $29 billion from all investors, versus $19 billion in 2017.

The localized effects in the SF Bay Area and Boston are particularly worth considering, especially given employment trends in each area.

For the Silicon Valley, the latest numbers seem to signal continued growth of the IT category. In 2017, about 47,300 more high-tech jobs were added, and in 2018, about 35,600 jobs. Mercury News speaks about the distribution of those:

“[In 2018], the tech industry added 22,900 jobs [out of the 35,600 high-tech jobs]…Google accounted for about 35 percent … Facebook produced 23 percent of the increase… Apple was around 30 percent and Salesforce produced 10 percent” — Mercury News

Biotech appears to be growing faster in Boston, however. According to the Boston Development & Planning Agency, 2017 saw Boston receive the highest-density growth of biotech jobs.

Furthermore, it appears that biotech investment is beginning to concentrate more in Massachusetts in general — the balance reports that, in Q2 2018, $1.65 billion was invested into biotech in Silicon Valley versus $1.62 in Massachusetts, which is impressive given Masachusetts’s much smaller job market (less than 1/6 the population of CA).

Looking Ahead

If the narrative suggested by the employment statistics holds, a few other factors related Greater Boston’s biotech industry would undoubtedly follow. It has an organic and deep-rooted concentration of biotech, versus where SV would theoretically need to compete by “pivoting” its IT focus, culture, and population — something rather unlikely. Greater Boston also benefits from the concentration of top-tier talent, research, and institutions in the nearby universities such as Harvard and MIT.

Furthermore, popularized media about problems involving Silicon Valley’s housing, company-level ethics, and workforce culture might cause said upcoming young talent to explore other alternatives to the original high-tech hub. These locational problems, however, are also issues that Greater Boston can specifically learn from to maximize long-term success and minimize shortfalls. This can range from analyzing the balance of corporate success and regulation in Silicon Valley, to other areas such as better policy for long-term, stable growth for all inhabitants.

So just as with any other situation, the human factors that come along with shifting employment trends will influence biotech development just as much as the scientific breakthroughs themselves. It’s exceedingly important we do this version better — privacy and ethics discussions will inevitably broach even more nebulous areas as biotechnology interfaces ever more fluidly with human bodies.

Still, the rise of this hub and its varying impacts on technology development remains to be seen — this shift is only just beginning, and the upcoming generations of talent are to assume this mantle. But it will undoubtedly drive the direction of the next stage of human experience as we know it, so one would most certainly do well to consider where their career might fall among this era of human progress.

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