Top 10 U.S. Markets for IT/Tech Spending

Which cities are home to companies that have the most budget dollars to readily invest in technology? We pulled the data to reveal the places where pockets run deep for businesses spending on IT purchases. Here are the top ten: 

#1  New York City
Total IT/Technology Budget: $145.5B
% of Revenue allocated to IT/Tech Spend: ≈ 3.6%
Number of Companies (HQ)*: 2860
Noteable Company % of Revenue to IT/Tech Spend: JP Morgan Chase (≈ 6.5%)
Other Notable New York City Companies: Verizon, MetLife, Citigroup, AIG
Home of the financial industry, NYC boasts twice as many companies as its closest competitor. The old guard sits atop the financial vertical spending significantly on maintaining legacy equipment, while emergent FinTech innovations have started to breed a healthy startup scene out to disrupt the way big banks do business.

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#2  Chicago, IL
Total IT/Technology Budget: $52.1B
% of Revenue allocated to IT/Tech Spend: ≈ 3.3%
Number of Companies (HQ): 1453
Noteable Company % of Revenue to IT/Tech Spend: Walgreen’s (≈ 4.3%)
Other Notable Chicago Companies: Boeing, Archer Daniels, State Farm, Allstate
This midwestern commodities and manufacturing giant seems to reinvent itself every generation. Food processing and chemical refineries remain the bedrock of the Windy City, which is complimented by a thriving technology services startup scene.

 

#3  Dallas, TX 
Total IT/Technology Budget:

$45.5B

% of Revenue allocated to IT/Tech Spend:                        ≈ 3.4%
Number of Companies (HQ): 913
Noteable Company % of Revenue to IT/Tech Spend: Exxon Mobil (≈ 4.5%)
Other Notable Dallas Companies: AT&T, Energy Transfer Equity
American Airlines
Naturally, oil is big in north Texas, as is telecom—a relative newcomer to the Lone Star State having relocated from California. In fact, Texas surpassed California as number two on the list of states with the most Fortune 500 companies in 2015.   

 

#4  Houston, TX 
Total IT/Technology Budget:                                  

$41.1B

% of Revenue allocated to IT/Tech Spend: ≈ 3.4%
Number of Companies (HQ): 809
Noteable Company % of Revenue to IT/Tech Spend: Phillips 66 (≈ 4.1%)
Other Notable Houston Companies: Enterprise Products Partners,
Sysco, Halliburton
The energy capital of the US took a few steps back with the fall of oil prices in the past few years, but Houston remains a center for industrial technology. Petrochemical, synthetics, fertilizers, insecticides—biochemical engineering drives the tech sector in Houston, which is home to many computer-related companies.

 

#5  San Francisco, CA
Total IT/Technology Budget:

$36.4B

% of Revenue allocated to IT/Tech Spend: ≈ 3.6%
Number of Companies (HQ): 1486
Noteable Company % of Revenue to IT/Tech Spend: Wells Fargo (≈ 4.3%)
Other Notable San Francisco Companies: Chevron, Apple, McKesson,
Google, HP
The tech industry lives here in the heart of Silicon Valley. A mix of established hardware companies, dot com survivors, software startups, and the investment banks that fund them, the Bay Area is also home to big oil and is a wholesale goods hub.

 

#6  Los Angeles, CA 
Total IT/Technology Budget:

$32.1B

% of Revenue allocated to IT/Tech Spend: ≈ 3.4%
Number of Companies (HQ):                                              1497
Noteable Company % of Revenue to IT/Tech Spend: Disney (≈ 4.3%)
Other Notable Los Angeles Companies: Amgen, Aecom, Health Net,
Molina Healthcare
The entertainment capital of the world hosts a diverse economy. Big pharma, insurance, and biomedical research star in the Los Angeles corporate market, as well as real estate investment firms and raw materials manufacturing.

 

#7  Washington, DC 
Total IT/Technology Budget (non-federal):

$31.8B

% of Revenue allocated to IT/Tech Spend:                             ≈ 3.7%
Number of Companies (HQ – non-federal): 1142
Noteable Company % of Revenue to IT/Tech Spend: Capital One (≈ 4.4%)
Other Notable Washington Companies: Fannie Mae, Lockheed Martin,
General Dynamics
The DC metro area traditionally builds its economy around the almighty federal government contract. Defense contractors are big business, along with large-scale services firms and consultancies. Cybersecurity is hot right now in the nation’s capital.  

 

#8  Boston, MA 
Total IT/Technology Budget:

$30.5B

% of Revenue allocated to IT/Tech Spend:                                           ≈ 3.3%
Number of Companies (HQ): 1137
Noteable Company % of Revenue to IT/Tech Spend: Fidelity Investments (≈ 12.6%)
Other Notable Boston Companies: General Electric, GE Capital, Dell,
Thermo Fisher Scientific
A center for higher education, finance and insurance, and technological innovation, Boston has a vibrant, well-rounded economy. Biotechnology is booming at the moment; there is such a plethora of companies that there’s fierce competition for top tech talent despite the windfall of graduates each spring.   

 

#9  Minneapolis-St. Paul, MN
Total IT/Technology Budget:

$27.4B

% of Revenue allocated to IT/Tech Spend:                                   ≈ 2.9%
Number of Companies (HQ): 594
Noteable Company % of Revenue to IT/Tech Spend: Cargill (≈ 4.3%)
Other Notable Minneapolis-St. Paul Companies: UnitedHealthGroup, Target, 3M,
Best Buy, 
US Bancorp
Minneapolis was the site of the original tech boom immediately after World War II, the home of Control Data Corporation, Cray Research, and medical device maker Medtronic. Today, the Twin Cities retains its tech focus with established companies and new startups, is home to several major retail headquarters, plus the largest corporation in the U.S. in terms of revenue, Cargill.

 

#10  Atlanta, GA
Total IT/Technology Budget:

$26.4B

% of Revenue allocated to IT/Tech Spend:                            ≈ 3.2%
Number of Companies (HQ): 809
Noteable Company % of Revenue to IT/Tech Spend: First Data (≈ 4.9%)
Other Notable Atlanta Companies: UPS, Home Depot, Coca-Cola,
Delta Airlines, Aflac
Logistics, consumer retail, and cable television make up the Atlanta establishment. A burgeoning telecom industry pulled the metro area out of the recession a decade ago; mobile software continues as a growth driver.

 

Takeaways

As you can see, there are not many surprises in the top 10. The usual coastal hubs New York, Los Angeles, Boston, and San Francisco rank near the top. Massive markets like Chicago, Dallas, and Houston are about right where you would expect them to be.

Washington, D.C in the seven spot, and Minnesota’s Twin Cities breaking into the top 10 are perhaps the most noteworthy developments. Even those two cities have firmly established Fortune 500 companies that have been around for decades. Once again, it is important to note that this list did not take into account any federal departments or their spending.

Immediately, we see how much larger the New York CIty economy and is than everywhere else in the U.S. with nearly twice the number of companies as the nearest competitor Los Angeles.

It might seem that Dallas, Houston, New York, and Twin Cities spend more on IT compared with the others on this list. However, if you drill into the average revenue for companies in their respective metropolitan area, the IT spend is proportional across the board.

 

Data compiled by Dorie Phillips