The highlights are a combination of very good news, continuing areas of disappointment and new challenges from the sizzling growth in the Valley.
Job growth in Silicon Valley is surging with 46,665 added jobs or 3.4% growth in the past year and today the Bureau of Labor Statistics noted that the San Jose metro area where Palo Alto is located was the nation's fastest growing major metro area for job growth in the year ending December 2013. The Index notes continuing gains in patents, venture capital and IPOs. This growth as readers know well has pushed home prices and rents to record levels in many communities and is causing near gridlock on many roads at peak commute times.
At the same time wage growth for many workers not in the tech economy remain stagnant despite job growth and reductions in unemployment. This has contributed to a widening gap between top earners and others?a trend that is not unique to Silicon Valley but which persists across decades and regions in the United States.
The Index also notes that still many children do not read or do math at appropriate grade level and high school graduation rates and achievement, while improving slowly, still leave far too many without the skills needed for higher education or a good job. And the high rents make it difficult for many, not just lower income households to live in the region.
Russ Hancock, President of Joint Venture, said "A surge of innovation between San Jose and San Francisco is driving prodigious growth from Market Street to Market Street, but with that comes with tough new challenges in housing, transportation and infrastructure for the entire region". Emmett Carson, President of the Community Foundation, said "This year's Index proves that a rising tide does not lift all boats" and these results call for "intentional public policies" to address the challenges of growth.
Here is my take. I agree with all three points: 1) the economy IS sizzling, 2) a rising tide does not lift all boats and 3) growth brings challenges in housing, transportation and other areas of our life. With most of the press coverage focusing on the people left behind in the surge of job growth, I want to focus attention on three other points.
One, while a rising tide has not lifted all boats?here or elsewhere in the nation?it certainly has helped to reduce unemployment and create rising state and local revenue that will help in addressing education and infrastructure deficiencies. Moreover, it is hard to see how much progress can be made n helping mobility for low and moderate wage workers without continuing economic growth. It is not sufficient by itself but is a necessary piece of the solution.
Two, Hancock and Carson were clear that the Index points to the need to increase opportunity and NOT to disparage or take away from the income and job gains that the tech surge has created.
Three, and the most important from my perspective, these two goals are CONNECTED. More housing options for all residents, better investment in our roads and public transit such as CalTrain and BART and improving K-12 and pre-school opportunities serve DOUBLE DUTY in supporting broad economic growth in the Valley and increasing economic opportunities for residents.
I think the issues raised by the Index are an important part of our upcoming discussions in Palo Alto about planning for our future.
I serve on Joint Venture's Silicon Valley Institute for Regional Studies board and assisted in the preparation of the Index?both activities in a volunteer capacity.
