Any discussion of Silicon Valley’s health must have the competition for talent at its core. From a policy perspective, talent is a three-legged stool: immigration from abroad, migration from other parts of the U.S., and local Bay Area talent.
Few expected 2017 to be a year of thoughtful pro-growth immigration policy. Of course, it turns out folks in Washington had quite a few thoughts about immigration. They have left Silicon Valley and other globally networked U.S. metro areas fighting a series of rear-guard battles against clumsy, blunt-force bans.
Those battles will continue, and need to be fought. But there is a lot that we can do on other fronts. In the competition for American talent — a second leg of the stool — we continue to lag behind key competitor regions like Seattle and Austin. And it’s not close. In 2015, we saw another net domestic out-migration from Silicon Valley, while those other regions added thousands of Americans from other parts of the country.
The cost of housing is a major driver in this trend, of course. Here again, the comparisons with Austin and Seattle over the 2010-2015 time period are grim. Yet the latest available housing data from California’s Department of Finance show positive movement more recently in Santa Clara and San Mateo Counties, and in San Francisco. In each of these cases, the gap between population growth and housing growth narrowed. That shift was driven more by reduced population growth than new housing, but we know that building housing is tough. Credit is due to the local officials making hard decisions to increase our housing stock. Just keep it up.
With respect to the third leg of that talent stool – Silicon Valley’s own local education systems – sweeping policy progress is hard to come by. When wins come, they are often district by district, or system by system. Here’s one: An initial meeting between leaders of ten of Silicon Valley’s community colleges and executives from some of the Valley’s largest tech employers earlier this month shows promise for closing the vexing gap between employers and educators. IBM sees such promise in community colleges that they have announced of an expansion of its partnerships with community colleges across the country to train tech workers. Are we seeing a trend?
In the third of our three mid-year reports, we’ll take a look at some legislation that we think can move the needle between now and the end of the end of California’s 2017 legislative year in September.