According to research by the London School of Economics and Political Science and the National Institute of Economic and Social Research, the number of digital economy jobs in the area climbed by 12.7% in just one year, to 18,679 in 2013.
This speedy growth is having unintended consequences, though. As writer and futurist Cory Doctorow pointed out in 2014, Tech City is pricing out the bootstrappers. Shoreditch was appealingly affordable when the neighborhood had a high crime rate and low broadband penetration. But success drew the pop-up shopping center made from reclaimed shipping containers and the outdoor movie theater with inflatable hot tubs. Then came plans for commuter rail service and luxury high-rise condos.
Now the old brick warehouses that rented for £20 a square foot just a few years ago are going for two to three times as much – if they haven’t been torn down for shiny high-rises that rent for £1,000 a square foot.
Gentrification drives out the creative people who have big ideas but small budgets. It happened in Brooklyn’s Williamsburg and San Francisco’s Mission District, and it may be rolling over to Silicon Roundabout next.
Hannah Donovan, cofounder of Last.fm and music startup This Is My Jam, told The Guardian, “When we found a new music-focused studio in Haggerston [a still-gritty neighborhood northeast of Shoreditch] that had the energy we were looking for – and cut our rent in half – it was an easy decision to leave.”