The number of open U.S. tech jobs offering remote work options hit a record high as technology companies lease less space for each employee in the pandemic, a new study found.

About 22% of U.S. tech job openings in the past year offered remote work, up from 4% in 2018 and 2019, according to the "Scoring Tech Talent" annual report released Thursday by real estate brokerage CBRE. The markets with the most listings for tech jobs offering remote work were the San Francisco Bay Area, Los Angeles-Orange County, Dallas-Fort Worth and New York City.

CBRE has ranked the top tech markets in North America on their ability to attract and develop tech talent for the past decade, but this is the first year jobs with remote work options became a measurable tool, said Colin Yasukochi, executive director of CBRE's Tech Insights Center in San Francisco.

Remote work means hiring is "less concentrated in some markets and disperses where candidates are located,” Yasukochi said in an interview. “Employers can reach beyond their limitations to engage and hire talent anywhere in the world."

That means lower-cost, up-and-coming markets with tech talent are emerging such as Huntsville, Alabama, and Dayton, Ohio, the report found. While the definition of remote work can vary by employer, Yasukochi added, some of those jobs probably have exceptions for meetings or presentations. And remote job listings are still tied to a market even if it means the employee may not live or work in that city, CBRE said.

Many employers last year turned to offering remote work to fill open roles in a tight labor market, but now the tech industry faces less certainty as some companies such as Netflix and Tesla lay off employees because of recessionary fears. If the economic headwinds continue, CBRE's analysts say, the layoffs and hiring slowdowns could loosen the tight labor market for tech talent. And smaller markets could benefit as employers offer a remote work option for tech jobs.

"Tech talent remains a very important aspect of our economy," Yasukochi tsaid. "This very strong growth engine has slowed down a little bit recently, but it will continue to be an important part of our economy."

The report ranks 50 tech talent markets in the United States and Canada based on 13 criteria such as graduation rates, tech job concentration, tech labor pool and real estate and labor costs. The San Francisco Bay Area ranked No. 1 by overall score, followed by Seattle, Toronto, Washington, D.C., and New York City, the same top 5 cities as last year, but Toronto and Washington, D.C., swapped spots. Markets with the top gains include Dallas-Fort Worth, Philadelphia, South Florida and Milwaukee.

The U.S. added a net 136,000 tech jobs last year, including 110,300 jobs from technology companies, 37,800 jobs in the life sciences sector and 18,900 jobs in the financial services, insurance and real estate sectors, according to Dallas-based CBRE's report. Industries that lost the most tech jobs last year include manufacturing, with 58,800, transportation, warehousing and wholesale at 34,900 and about 15,800 tech jobs in telecommunications.

Of all the U.S. tech jobs added last year, software developer roles accounted for the most with 159,500 jobs, followed by tech managers accounting for 27,900 positions. Tech roles losing the most jobs were mostly in support-related positions.

Since the pandemic, tech companies have taken less space per employee compared with pre-pandemic trends, Yasukochi said.

“A lot of this has to do with the uncertainty related to the return to the office,” he said. "Most employers’ office space is still an important part of their strategy as it relates to workforce and how they conduct their business. If you look at where tech talent is created from local universities and follow the tech talent, that's where tech employers will go and eventually need office space."

The tech industry's impact on U.S. office leasing has dipped and recovered in recent years, going from 21% of office leasing in 2019 to 17% in 2020 before returning to 21% last year.

Despite tech companies leasing less office space since the pandemic, CBRE's report gauges the most expensive markets for a tech company to set up shop in, estimating a typical 500-person tech company would need 75,000 square feet of office space. The San Francisco Bay Area's annual office rent and salaries total $69.2 million, followed by New York City at $60.5 million. Indianapolis is the cheapest U.S. market out of the top 50 markets with annual costs of $40.5 million, according to CBRE.

Labor costs are more heavily weighted than office rents in the equation, mirroring how tech employers allocate more money to recruiting and retaining the right tech workers. The San Francisco Bay Area ranked highest for average annual tech worker salary of $140,000, which is about $18,000 more than Seattle, which is the next highest market, according to the report.

However, office landlords benefit from being in proximity to clusters of tech talent and tech workers often bring a wave of economic prosperity to a market as those employees rent apartments, buy homes and spend money in the area. For office asking rents, New York's Manhattan area ranked as the most expensive with annual asking rent of $77.45 per square foot, according to the report. Cleveland, Ohio, ranked as the least expensive with annual office rents of $18.71 per square foot.

Beyond the top 50 tech talent employment hubs, CBRE also ranks what it calls the "Next 25" tech markets using a narrower set of criteria based on jobs, including software engineers and data managers, across all industries. These lesser-known North American tech markets offer the promise of additional tech talent for employers.

In the United States, the up-and-coming markets are concentrated in the Midwest and South. Compared to large tech talent cities where jobs often drive economic growth and a more competitive landscape for quality real estate — these smaller markets tend to have more affordable labor and real estate costs.

Huntsville ranked as the No. 1 up-and-coming market, followed by Dayton; Colorado Springs, Colorado; Omaha, Nebraska; and Albany, New York. The 25 markets represent opportunities for companies wanting to expand their geographical reach and foster talent development, according to CBRE.

For example, the number of tech jobs in Huntsville grew 15% over the past five years to nearly 23,000 positions. That growth is higher than San Francisco's 13% increase over that time to nearly 379,000 tech jobs.

Huntsville has far outperformed the national average for population growth over the past decade, buoyed by job growth at the U.S. Army's Redstone Arsenal post. Toyota and Mazda opened a $2.3 billion manufacturing plant in late 2021 with that facility expected to support more than 4,000 jobs with average annual salaries of $50,000 when fully staffed.

But the labor pools in the emerging markets identified by CBRE are much smaller compared to their larger peers, Yasukochi said, and are unlikely to shake up the list of top North American markets for tech talent.