Tech companies in smaller cities are starting to see an uptick in applications from candidates living in San Francisco and New York—areas that have long had a grip on tech talent.

Deepinder Singh, founder of a Bloomington, Minn.-based startup, had never bothered trying to recruit Silicon Valley tech workers. They were too expensive and didn’t want to move. In seven years, he had never gotten an applicant from a large tech company.

But…

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