Tech Firms’ Investments in Workers Often End Up Benefiting Competitors

When they change jobs, high-tech employees bring a lot of previously acquired know-how with them, boosting their new companies’ productivity. A study of hundreds of thousands of workers over 20 years by Prasanna Tambe of New York University and Lorin M. Hitt of The Wharton School suggests that the productivity-growth effect of this flow of workers is 20% to 30% as large as that of the companies’ own IT investments. The finding at least partially explains why many firms consider it advantageous to locate in places like Silicon Valley, the researchers say.