Last week, Justin Fox at Bloomberg points out, more than one columnist—himself included—predicted the end of Silicon Valley, citing all the things that make it hard to live there: housing costs, tax rates and traffic, not to mention drought, fire, flood and earthquakes.
But, Fox writes, his analysis of new employment numbers released at the beginning of this week show "the opposite of an exodus."1
"[M]etro San Jose is back to adding jobs at more than twice the pace of the U.S., and metro San Francisco appears to be bouncing back, too. Among the nation's 50 largest metro areas, San Jose ranked seventh in the rate of job growth from January 2017 through January 2018, and San Francisco was more or less tied for 17th with Houston. The nearby Sacramento metro area came in tenth."
Silicon Valley is totally over, right? I mean, it says so in the New York Times, which ran a much-discussed story last week headlined "Silicon Valley Is Over, Says Silicon Valley." And it says so here at Bloomberg View, where my fellow columnist Conor Sen opined last fall that "The Numbers Show Silicon Valley Is Already Fading," and I followed up a few days later with a column on how job growth had slowed sharply in the San Francisco and San Jose metropolitan areas.
And why wouldn't Silicon Valley -- which I'm defining broadly here to encompass the entire San Francisco Bay Area -- be over? With housing supply constrained by an ocean, a bay, mudslide-prone hills and California's notoriously development-unfriendly politics and regulations; overcrowded highways; underwhelming public transportation; underfunded schools; persistent water shortages; some of the nation's highest income taxes; and reputedly some of the nation's most insufferable people, the area has become an increasingly difficult place to live and work. I mean, even billionaire Peter Thiel is moving away (to Los Angeles)! Why would anybody stay?
With new state and metropolitan-area job numbers out Monday from the Bureau of Labor Statistics, complete with revisions of the past year's data, I thought I'd check on the status of this Silicon Valley exodus. These employment numbers are the timeliest regional economic indicators available. And it turns out that what they show is ... the opposite of an exodus.