Abstract:
Regional policy-makers have long sought to attract highly-educated workers with a
view to stimulating economic growth and vibrancy. Previous studies over the decades leading up
to the new millennium show human capital divergence across cities, where the share of college
graduates grew faster in cities that had larger initial shares of college-educated workers.
However, labour markets have changed significantly post-2000, likely affecting migration
decisions of highly-skilled workers. Additionally, past studies have not controlled for important
changes in industry education levels and overall industry composition that may influence
city-level college graduate growth. We use detailed 4-digit NAICS industry employment data
combined with public micro-data to construct measures of industry skill upgrading and changes
in industry composition to control for their effects on human capital growth. We find agglomeration forces, rather than initial graduate share, explains college-graduate share growth post-
2000. We also decompose graduates into bachelors and postgraduate degree holders to
determine whether different forces are at play on growth of graduates at different education
levels.
