Technology companies in cities like Austin, Texas and Raleigh, North Carolina are competing more frequently with Silicon Valley for engineering, software and development talent. According to The Wall Street Journal, tech workers are able to be more choosy about their employers this year compared to last with higher job demand and an economy in recovery mode.

Companies in these smaller cities are trying to get a leg up on the competition by taking on more interns than they would normally, trying them out and offering them full time jobs. But the competition is heating up, said the WSJ. Companies are also employing signing bonuses and other incentives to keep the talent from moving to larger metropolitan cities with broader technology presence.

Companies in second-tier tech locations such as Austin, Texas, and Raleigh, N.C., had an easier time recruiting talented employees during the slump. But now that Silicon Valley firms have started aggressively hiring, and the general economy is improving, competition is stiffening.

"We've always had a bit of a competition for talent with Silicon Valley," says Julie Huls, president of the Austin Technology Council, a trade group of Austin-area technology executives. "As firms over there start to recover, we have to make sure we stay in the game."

Red Hat, one of the major players in open source software, is planning on hiring 800 employees in a number of locations in the U.S. The company says it retrained hiring managers to sell Red Hat as a place of autonomy with an entrepreneurial spirit.

The pitch worked for Ashesh Badani, a 37-year-old high-tech manager for new software whom Red Hat hired two months ago, relocating to a Waltham, Mass., office. He had worked in Silicon Valley for nine years, most recently at Sun Microsystems Inc.

He was reluctant to move but says he was swayed by the stories Red Hat employees--including his now boss--told him about having more autonomy.