Maybe Silicon Valley Isn't Quite the Growth Engine it Used to Be
Here's an interesting little tidbit from the New York Times, which looked into whether Silicon Valley's explosive growth has now plateaued: It turns out that other sectors of the Bay Area economy are starting to expand at a quicker pace than the tech sector, according to Ted Egan, chief economist for San Francisco.
In fact, since hitting its peak last August, Egan tells the Times that the tech sector in San Francisco and San Mateo counties have "lost 700 jobs from January to February and tech employment has dropped by 3,200 jobs."
Here are some of the key facts and figures, via Egan and the Times:
While the tech sector has grown faster than other parts of the Bay Area economy since 2010, Egan tells the Times that's now "beginning to reverse." To wit: Construction is surging by 7 percent, education is growing by 4 percent and financial services is up 3 percent.
Egan says that venture capital has "peaked" and "has been going down steadily since 2015." This does not bode well for tech startups, many of which are not profitable and rely on VC funding, as Egan notes. "If we see a real downturn in the tech sector we could be in a situation where the U.S. economy is doing better than San Francisco’s," he tells the Times.
Egan is hearing that the luxury housing market in San Francisco is slowing.
The average rent in San Francisco has dropped from $4,400 to $4,200, still making it much higher than any big city in the U.S., Egan notes.
Anyway, here's a trailer for the Season 4 of HBO's Silicon Valley.