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February 15, 2014 08:00 pm GMT
The liberal wonderland of the San Francisco Bay Area has one of the highest concentration of wealth in the country. Twitter’s IPO, alone, created an estimated 1,600 millionaires. But, are local residents catching any of the dollar bills being shaken from post-IPO money trees? It’s been hard to decipher the broader impacts of technology on the average San Franciscan because heart string-tugging anecdotes have clouded the narrative. Critics of tech companies make headlines by protesting Google’s private buses and indirectly linking their existence with the surge in housing evictions.”There’s a war brewing in the streets of San Francisco,” wrote former San Francisco Mayor Willie Brown. On the other hand, tech champions like to trot out small business owners who have benefited from re-locating tech HQ’s to blighted areas of the city’s historic Market district. So, to cut through the cherry-picked anecdotes, I asked San Francisco’s local economists what their take is and, as you’d imagine, they fall somewhere between the techno-utopian dreamspeak that you sometimes hear in the industry and the dire descriptions of the activists. One thing is clear: they believe that the money flowing into SF is a good thing and is bolstering the local economy. There is a “but” in the economic optimism, and its big enough to need two plane seats: skyrocketing rents are pricing many locals out of the city. Some have managed to fasten themselves to rent-controlled properties, but many have been forcibly evicted from their homes. On balance, tech money has built one of the sturdiest economic shelters from the ravages of recession, but those who get hit, well, they get hit hard. Local Multipliers Makin’ It Rain “Our analysis suggests the tech sector is responsible for the vast majority of the economic growth in San Francisco since 2010,” said San Francisco’s Chief Economist, Ted Eagen. “In 2010-2012, the latest year we have complete data, local inflation has been 2.6%, while wages for all workers have increased by 4.5%.” About 2/3rds of those approximately 40,000 new jobs do not require a computer science degree or a closet full of expensive sneakers. Partly thanks to the tech sector, the San Francisco Bay Area enjoys the 3rd lowest unemployment rate (4.8%) of California’s 58 counties. What accounts for this? Berkeley Economist Enrico Moretti argues that technologists have a special bond with the local economy. “Anytime there is a job opening for a software engineer at
Original Link: http://feedproxy.google.com/~r/Techcrunch/~3/CQMDHXAyj0A/
Is Tech Money Good For San Franciscos Middle-Class? An Economists Perspective
The liberal wonderland of the San Francisco Bay Area has one of the highest concentration of wealth in the country. Twitter’s IPO, alone, created an estimated 1,600 millionaires. But, are local residents catching any of the dollar bills being shaken from post-IPO money trees? It’s been hard to decipher the broader impacts of technology on the average San Franciscan because heart string-tugging anecdotes have clouded the narrative. Critics of tech companies make headlines by protesting Google’s private buses and indirectly linking their existence with the surge in housing evictions.”There’s a war brewing in the streets of San Francisco,” wrote former San Francisco Mayor Willie Brown. On the other hand, tech champions like to trot out small business owners who have benefited from re-locating tech HQ’s to blighted areas of the city’s historic Market district. So, to cut through the cherry-picked anecdotes, I asked San Francisco’s local economists what their take is and, as you’d imagine, they fall somewhere between the techno-utopian dreamspeak that you sometimes hear in the industry and the dire descriptions of the activists. One thing is clear: they believe that the money flowing into SF is a good thing and is bolstering the local economy. There is a “but” in the economic optimism, and its big enough to need two plane seats: skyrocketing rents are pricing many locals out of the city. Some have managed to fasten themselves to rent-controlled properties, but many have been forcibly evicted from their homes. On balance, tech money has built one of the sturdiest economic shelters from the ravages of recession, but those who get hit, well, they get hit hard. Local Multipliers Makin’ It Rain “Our analysis suggests the tech sector is responsible for the vast majority of the economic growth in San Francisco since 2010,” said San Francisco’s Chief Economist, Ted Eagen. “In 2010-2012, the latest year we have complete data, local inflation has been 2.6%, while wages for all workers have increased by 4.5%.” About 2/3rds of those approximately 40,000 new jobs do not require a computer science degree or a closet full of expensive sneakers. Partly thanks to the tech sector, the San Francisco Bay Area enjoys the 3rd lowest unemployment rate (4.8%) of California’s 58 counties. What accounts for this? Berkeley Economist Enrico Moretti argues that technologists have a special bond with the local economy. “Anytime there is a job opening for a software engineer atOriginal Link: http://feedproxy.google.com/~r/Techcrunch/~3/CQMDHXAyj0A/
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