Apple Searching For A Home Away From Home

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Apple  Apple will expand its workforce at new and existing offices across the country and plans to build a billion-dollar campus for 5,000 additional employees in Austin, Texas.

Though Austin will land the biggest part of the Silicon Valley giant’s expansion, the Cupertino company also announced plans Thursday to open additional offices in Culver City, San Diego and Seattle — bringing head counts  to 1,000 in each over the next three years. It will add hundreds of employees in its offices in Boulder, Colo., Pittsburgh and New York as well .

“Talent, creativity and tomorrow’s breakthrough ideas aren’t limited by region or zip code, and, with this new expansion, we’re redoubling our commitment to cultivating the high-tech sector and workforce nationwide,” Apple Chief Executive Tim Cook said in a statement.

Despite Cook’s rhetoric, Apple — which employs 90,000 workers in roles ranging from retail to engineering across the country — isn’t spreading its high-end tech jobs too widely. Like other behemoths in its industry, it’s picking cities that already fit a certain tech-ready mold.

Thursday’s announcement follows on the heels of similar moves from other West Coast tech conglomerates. Google executives have discussed plans to more than double the company’s 7,000-employee operation in New York City. Amazon, after pitting cities against one another in a yearlong bidding war for its new mega-offices, settled on splitting 50,000 workers between New York City and the D.C. metro area, which already boast established tech economies.

The places where Apple is looking to grow share a similar profile, with vibrant cultural scenes and the types of amenities favored by high-income tech workers.

“The digital strong get stronger, in terms of tech employment,” said Mark Muro, senior fellow and policy director at the Brookings Institution’s Metropolitan Policy Program. “Big tech companies are looking for the same demographic, the same sorts of development talent, and those are pooling and agglomerating in a short list of big places — Austin is very much cut from the same cloth.”

Nearly 45% of tech industry jobs are concentrated in 10 major metropolitan areas, according to research set to be published by Muro’s office this month.

But the success of technology companies in their historic home — the San Francisco Bay Area — has in a way become a burden. With 10% of the nation’s total tech workforce competing for housing in the region, prices have soared and traffic has intensified, making other areas more attractive to some workers.

“You have only to look at Seattle and the Bay Area as the state-of-the-art dystopian over-concentrations,” Muro said. “These industries have brought tremendous prosperity, but they’ve also created a quality-of-life disaster in many respects.”

In January, Apple laid out plans to add 20,000 jobs and invest more than $30 billion in the United States over the next five years in response to the huge tax windfall it would receive under the tax cuts signed into law in late 2017.

The company, which is the most profitable in the world, had long been criticized for hoarding money overseas to avoid taxes, but a provision in the 2017 cuts allowed for a one time repatriation of cash held abroad at a lower rate. Previously, those earnings would have been taxed at the standard 35% corporate tax rate. Under the new law, the rate is just 15%.

Apple took advantage of the discount to bring back much of its overseas holdings, the company said in January, adding that it would make a one time tax payment of $38 billion as a result.

Culver City’s mayor told The Times that Apple is not receiving any financial incentives in the city. In Austin, Apple is set to receive as much as $25 million in taxpayer funded grants and is seeking a 15-year property tax abatement from Williamson County, according to reporting by the Austin American-Statesman.

Apple’s plans to expand its footprint with a new Culver City office are a sign of its growing investment in original content production.

The company is expected to spend $1 billion this year on original content, increasing to $4.2 billion in 2022, according to venture capital firm Loup Ventures.

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