When you mention Silicon Valley, people’s first thoughts are software and tech giants. Any successful business nowadays inevitably relies upon its ability to have the various departments keep up with the most up-to-date solutions, and technology from the valley is there to save the day if they run into any problems along the way.

We can see this with accounting streamlining the payment process with quickbook checks. We can also see that technology is breaking out of the bounds of Silicon Valley into more affordable cities and states that would gladly welcome the chance to become the next great tech hub.

Reason Why Amazon Has Chosen Detroit

Although Amazon’s headquarters is located in Seattle, Washington, similar tech giants may prefer to expand in Silicon Valley simply because it is the most popular technology hub and destination for tech companies.

On the other hand, it’s not surprising to learn that Amazon has chosen Detroit. According to Amazon, the company has long established its ties with some universities in Michigan in terms of hiring talented people. This means that talent acquisition, especially in the tech industry, is not difficult to accomplish in Detroit as the Motor City has a deep supply of tech-savvy people.

Amazon believes that Detroit can be the next Silicon Valley. Besides having an educated workforce, the cost of doing business in Detroit is also very low. This attracts many tech companies from different cities in the country.

Since 2012, the number of tech jobs produced in Detroit has steadily increased. In 2015 alone, tech jobs in the motor city reached 181,000, and this number is still growing. Such numbers make Detroit on par with Silicon Valley in terms of producing tech jobs.

Amazon’s Commitment to Doing Business in Detroit

Amazon is the first big tech company to expand to Detroit. This is a boost to the pride and confidence of Michigan locals after the recent headlines about big companies such as Chrysler and General Motors filing for bankruptcy .

Nevertheless, the unemployment rate in Detroit is gradually decreasing since 2015. According to The Bureau of Labor Statistics, Detroit recorded a 5.6 percent unemployment rate, just a few points higher than the national average of 5.1 percent.

With the improving business climate in Detroit, Amazon is committed to growing their presence in the city. As initial proof of its enthusiasm to continue doing business there, Amazon pledged 30 Amazon Fire Tablets to a public school in Detroit. The company has also donated a total of $10,000.

Is Detroit the Next Silicon Valley?

In 2015, the Anderson Economic Group ranked Detroit the 15th among tech hubs in the country, and it looks as though Detroit is way behind Silicon Valley. Moreover, Michigan only contributed a little in the growth of tech industry at a national level.

According to Cyberstates 2015 report, the tech industry contributed 7.1 percent of the total US economy. This number is very significant given that there are a lot of industries that comprise the total US economy.

Final Thoughts

Silicon Valley still remains the most popular tech hub in the world and will continue to become a model for other cities to follow. Nonetheless, Amazon’s move is a big factor that can make other tech companies consider similar options. This could be the sign that Detroit might be the next Silicon Valley.