That’s not how things work, Weinberg said.
“This region’s economy is very robust, and even though we have
many things that need to be improved, this (Index) document and
others suggest our time is anything but over.”
Google Inc.’s plans to build a “village” on the western edge of
Downtown San Jose near the Diridon train station are a testament
to Silicon Valley still being the center of the high-tech universe,
said Stephen Levy, director and senior economist for the Center
for the Continuing Study of the California Economy in Palo Alto.
He’s also a researcher and adviser for the Index.
“Despite the high housing costs and traffic congestion, these
companies are voting with their dollars,” Levy said. “While it
may not be the only place, this is still the main place to be for
The Google development calls for up to six million square feet
of office, research and development and retail space downtown.
It could create up to 20,000 jobs.
Hancock heartily concurs with Levy’s assessment.
Collectively and individually, times are good. According to the
Index, average annual Valley earnings were $131,000 in 2017,
with median household income at $110,000. By comparison,
median household income in 2016 was $67,739 in California
and $57,617 in the nation as a whole, according to the U.S.
Census Bureau’s latest available data.
But those sky-high salaries go hand in hand with astronomical
housing prices and rents. In Santa Clara County, the median
home price was $1,232,300 in February 2018, a 23.5 percent
increase over February 2017. It was higher still in San Mateo
County at $1,315,400, though that figure represented only a 19
percent year-over-year increase. Rents in the region soared 37
percent from 2011 to 2017 and childcare costs rose 31 percent
from 2012 to 2017.
For those looking to move into or up in Silicon Valley, the
barriers are high.
NO ROOM AT THE INN
“Our housing woes are at the point of crisis,” Hancock said. “It’s
at the point where even highly successful and compensated employees
can’t afford housing.”
Hancock said he hears regularly from Silicon Valley CEOs that
they can’t even find suitable housing for some of their executives.
As a result they often can’t recruit the talent they need for Bay
“They say that perhaps they just shouldn’t hire in Silicon Valley
anymore,” he said. “They’ll hire staff in other places—Austin,
Boston, Portland or Seattle. I hear rumblings of that all the time.”
Yet CEOs not finding digs suitably affluent enough for them is
not the region’s most pressing housing problem. San Jose city officials
counted 4,350 people living on their streets in January 2017.
Santa Clara County officials counted 7,394 homeless people in its
2017 census of this population, many of whom are employed but
priced out of homes and apartments. Local colleges and universities
say they know of hundreds of their students who are couch
surfing, living in their cars or even on the streets. San Jose State
University—the graduates of which provide the largest number
of workers for Silicon Valley tech companies every year—has a
program that makes food available free of charge to hundreds of
students needing assistance.
Hancock said he thinks local and state officials finally do
realize the gravity of the housing and homelessness crisis. San
62 South Bay Accent
Jose has plans to build 25,000 new housing units and Mountain
“I think we are turning the corner on housing,” said Levy.
“We have 30,000 new units planned in the Bay Area. We are
still in a period of short supply, but I think we are slowly catching
up to the need, at least in rental housing. I’m optimistic that the
housing shortage, especially on the lower price end, has caught
Many affluent Silicon Valley cities catch their share of criticism
for not building nearly enough housing, period, let alone
the affordable variety. Levy praised San Jose, Mountain View,
Sunnyvale, San Francisco and Oakland for doing their share or
even carrying more than their regional weight.
Hancock said local and state government officials need support
in their newfound efforts to “stand up to the NIMBY (Not In My
Back Yard) crowd.”
“We built 12,000 new housing units last year in Silicon Valley,”
he said, “but we have 47,000 new jobs.
“Middle-skill and mid-wage jobs are vanishing,” he said. “Income
inequality becomes more pronounced with each passing
year. Last year, nearly one-third of Silicon Valley households required
some form of assistance in order to get by, and 10 percent
of residents were food poor,” Hancock said.
“Our surveys show that 40 percent of people in the Bay Area
are making plans to leave at some point during the next three
years,” he said.
HUMAN SUSTAINABILITY ISSUES
Those statistics, rather than rosy job growth in the tech sector and
VC funding numbers, are far more meaningful to Dr. Jeffrey Pfeffer,
the Thomas D. Dee II Professor of Organizational Behavior at
the Stanford University Graduate School of Business.
“If I was running the report, which I am not, I would include
measures of human sustainability, or basically physical and psychological
well-being,” Dr. Pfeffer said.
He explained that a report incorporating sustainability issues
would measure how many close friends Silicon Valley residents
have, the stability of those relationships, prescriptions for antidepressants,
self-reported physical health and mental health,