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A growing number of startups are being created across the country — and they're cropping up outside of the top innovation hub cities. That's according to new data released today by TechNet and the Progressive Policy Institute.

Why it matters: Political and economic dynamics are forcing companies and investors to pay more attention to business activity in middle America, where many workers feel left out of the booming economies of the coastal cities (think San Francisco, San Jose, Seattle, New York and Boston.) Following the recession, start-up formation stalled outside of the big tech hubs like Silicon Valley. But activity has picked up over the past two years, with midwestern cities gaining momentum.

Expand chart

Data: TechNet / Progressive Policy Institute Report; Map: Lazaro Gamio / Axios

The findings:

  • Almost half (48%) of new start-up growth is happening outside of the 35 largest metro areas.
  • Top 10 emerging start-up hubs: Washington, D.C., Atlanta, Denver, Salt Lake City, Portland, Dallas, Raleigh-Durham, Worcester and Philadelphia.
  • Cities to watch include Nashville, Cleveland, New Orleans, Minneapolis, Detroit.
  • In 2014, companies in their first 5 years created 2.2 million jobs, while firms older than 5 years created 450,000 jobs.
  • New startups could create one million new jobs per year nationwide.

"Start-up activity has burst out of the tech hubs and is really spreading across the entire economy," PPI's Michael Mandel, who conducted the study, told Axios. "You're starting to see the new green shoots come up in a lot of areas."

What to watch: Local and state level officials are looking for ways to encourage more start-up growth in midwestern regions, including tax incentives for homegrown companies and helping boost access to capital.

Go deeper

Biden administration takes steps to "fortify" DACA

People attend a protest supporting DACA in New York, Aug. 17. Photo: Kena Betancur/AFP via Getty Images

The Biden administration on Monday took additional steps to save the Deferred Action for Childhood Arrivals program despite ongoing legal challenges to the program.

Driving the news: The Department of Homeland Security unveiled a proposed rule designed "to preserve and fortify" DACA, which offers protection from deportation for undocumented immigrants brought to the U.S. as children. The rule is set to formally publish on Tuesday and would give the public two months to submit comments in favor of or against the Obama-era policy.

Dan Primack, author of Pro Rata
1 hour ago - World

Merkel's departure could bring influx of private investment

Christian Democratic Union party chairman and candidate for the federal elections, Armin Laschet, in front of German Chancellor Angela Merkel in Berlin on Sept. 26. Photo: Clemens Bilan/Pool/Getty Images

Angela Merkel's departure from German government may result in a massive influx of private investment.

Driving the news: The center-left Social Democratic Party, led by chancellor candidate Olaf Scholz, clinched a narrow victory in Germany's federal elections. It now will seek to form a coalition government by year-end with the Greens and the Free Democrats.

Instagram pauses development of platform for kids

Photo: Lorenzo Di Cola/NurPhoto via Getty Images

Instagram announced Monday that it is pausing its plans to develop a version of its platform for children under 13.

Why it matters: Facebook has received backlash since the Wall Street Journal published a report that showed the company knew its Instagram app is harmful to teenagers.