While a company’s headquarters can be located anywhere, the location of these offices is important for many reasons. Traditionally, the corporate headquarters has housed key personnel who are responsible for running the company. This is where the decisions are made and the decisions are communicated to the principal entities. Most branches of the company report to the corporate office, although employees may visit corporate headquarters for training purposes. The question of where to locate corporate facilities has become strategic for many companies for decades.
In the past, the industrial Midwest was a preferred location for corporate headquarters, but this has changed dramatically with the growth of the high-tech knowledge economy in the San Francisco Bay Area. However, New York has remained a major location for corporate headquarters, with 16% of the total since the mid-’50s. In addition to New York, other cities are becoming more popular, including Chicago, Cleveland, Detroit, Pittsburgh, and Minneapolis.
The geographic location of corporate headquarters is changing rapidly. The Bay Area and the industrial Midwest have lost ground to the Bay Area and the San Francisco Bay Area, the high-tech knowledge economy. While the Bay Area and the industrial Midwest have been relegated to the background, New York remains the leading location for corporate headquarters. The Bay Area has accounted for almost 40% of corporate headquarters. The cities of Chicago, Cleveland, Detroit, and Pittsburgh are the next-ranking locations.
In contrast, the industrial Midwest has been losing ground to the high-tech San Francisco Bay Area. While New York is still the top location for corporate headquarters, the city has continued to grow in a steady pace. In fact, New York has become the center of the global corporate headquarters market, accounting for 16 percent of all companies’ headquarters. In the mid-’50s, Cleveland, Pittsburgh, and Minneapolis were the second- and third-ranked locations for corporate headquarters.
In the past, the industrial Midwest was a hub for corporate headquarters. Today, it is a hub for high-tech companies and is the place to base a business. By the early 1900s, New York was the largest city for corporate headquarters, followed by Chicago, Cleveland, Detroit, and Pittsburgh. The Midwest was also the home of major industries, including manufacturing. In the ’60s, the industrial Midwest was second in terms of numbers of corporate headquarters, but the trend shifted back to the Bay Area in the mid-1950s.
The location of corporate headquarters is important for any company. The location of a company’s headquarters is where the key decision makers sit. In the present, physical locations have less significance than in the past, but the symbolic value of a prestigious location cannot be ignored. Besides, a location in a metropolitan area can be more advantageous for a company’s tax advantages. In a more developed region, it is important to be near the headquarters of a large multinational corporation.