Absolutely. It’s weird though that tech focused companies with Silicon Valley style cultures who are looking to cut costs are completely uninterested in those regions. With more developer-friendly working conditions, they wouldn't have to compete as aggressively on TC. And with more normal cost of living, it could be sustainable for senior people who are not independently wealthy to have long tenures there.
I think you are absolutely right that there appears to be some low hanging fruit for tech companies to pick by looking to "second tier metros". But I inertia and (lack of) critical mass play a big role.
In the past decade (i.e., when the money was plentiful) when a startup is young, the TC of its engineers rarely makes or breaks the startup. Being able to get an MVP out and iterate quickly is more important, so it was a rational choice to stay in the Bay Area even if it means 30% inflated TC. And after that moving is expensive in both time and money and risky (e.g., a key engineer might not want to go).
And having a critical mass of tech companies helps attract talent: if a company goes under or has large layoffs it is perceived to be easier to find a new job in the center of the tech hub.
I think covid helped nudge along the process of moving tech development out of SV, but it is a slow process. My 2c.
Some tech is. Meanwhile large tech companies that are actually innovating (FAANG, near-FAANG, and FAANG-adjacent companies) are not. My comp has never been higher, and we're hiring. In the bay area.
These companies are always innovating. Google doesn't just say "Our ad recommendation system is good enough, lets just go into maintenence mode for a year." No. They constantly are trying to improve their models, switch to a better architecture, and innovate to try and eke out a few more percentage points of conversions.
