Software Expertise: Where European cities lag behind and where they excel
An interactive visualization developed by researchers at the Complexity Science Hub (CSH) and IT:U reveals strong geographic skills specializations.
Based on data from nearly 1,000 cities, it shows that while Europe trails the United States and China in many high-end and valuable software skills, it retains important strengths in areas such as cloud computing.
“Software is one of the most economically valuable and geopolitically important industries,” says Frank Neffke, who leads the Transforming Economies research group at the Complexity Science Hub and is also a professor at IT:U.
“For a city that wants to grow its software sector, it is important to know what its current strengths are and what kind of diversification and growth paths these strengths enable for the future.”
The visualization, called Software Skill Space, maps 237 software skills across 976 cities worldwide between 2010 and 2022. Users can explore which skills are concentrated in different cities, compare software hubs, and identify potential paths for future growth.
Strong clusters are widespread
The data reveal a pattern known from traditional industries: Despite being a highly globalized industry, cities develop distinct software profiles and tend to build new capabilities on top of existing strengths.
“For example, London is one of the biggest developer hubs overall, but some skills, such as AI- or iOS-related skills, are overrepresented in the British capital compared to other cities,” says Johannes Wachs, a CSH faculty member and Associate Professor at Corvinus University of Budapest.
Rather than branching into entirely new fields, cities tend to diversify into skills closely related to those they already possess.
The data also show that new software specializations emerge in only a handful of places. Of the 35 emerging skills studied by the researchers, nearly two-thirds originated in just four cities: London, San Jose (Silicon Valley), New York and Seattle.
What about Europe?
While US and Chinese cities dominate many fast-growing and highly valuable software specializations, the results point to important areas of European competitiveness.
London, Paris and Berlin remain major software hubs, while Dutch and Nordic cities perform strongly in cloud computing and Northern countries and Germany stand out in gaming technologies.
For Austria, the visualization suggests growth potential in Android-related software skills, particularly in Vienna and Linz.
More broadly, the researchers argue that understanding local strengths is key to developing realistic strategies for growing regional software ecosystems.
While the dataendsin2022, before the widespread adoption of generative AI, the researchers argue they remain highly relevant.
“It takes years to become an experienced software developer,” says Professor Neffke. “What type of expertise a city specializes in changes only slowly. Nevertheless, AI is rapidly changing the nature of software development jobs.”