A Message About the 2019 Index
This year’s Index is something of a Rorschach test.
There’s certainly plenty to cheer about. We’re an economy at full employment, and yet we continue adding jobs. Venture capitalists generated an astounding $50 billion, and there are so many “unicorn” companies out there that the term is losing its meaning. There was vigorous acquisition activity, a surfeit of IPOs generating billions, and much of this activity was happening in those key trending areas heralded by the futurists: artificial intelligence, augmented reality, and next-generation immunotherapies for cancer treatment. All of this happens during a time of market volatility and policy uncertainty, and it is a testament to our region’s remarkable agility.
Not surprisingly, Silicon Valley’s income gains are fairly stunning. Average annual earnings have reached $140,000, a figure more than double the national average. The number of high-income households grew by 35 percent over the past four years. As a society we’re making significant education gains, we’re becoming even more diverse, women are increasing their presence in the tech sector and in the halls of government, we’re increasingly clean and green, and we’re voting in elections like never before.
And yet we worry.
It’s because there’s also plenty in these pages to give the pessimists a new set of talking points. It’s not just that our transportation woes continue to mount or that we have the nation’s highest housing costs. It’s not the yawning income divide and the persistence of real poverty in our region. All of that is deeply troubling, of course, but it’s old news.
What’s newly disquieting are indicators suggesting our fundamentals might be changing. More people are leaving the region than coming into it. Most of our growth in tech is being driven by a handful of large, established companies. These same companies are acquiring smaller ones at a pace we’ve never seen, changing the messy way innovation has typically happened here, perhaps even stifling it. Fewer startups are getting their seed funding. Our high costs (including salaries) are causing innovative companies to look elsewhere. All of it is happening against a backdrop of bad press.
Making sense of Silicon Valley is never easy because it is a complex and multi-faceted place. As we talk about who we are and who we’re becoming, it will be more important than ever to have the actual facts at our disposal. We’re pleased to provide them, and eager to facilitate a broad regional conversation about where we go from here.
President & Chief Executive Officer
Joint Venture Silicon Valley
Silicon Valley Institute for Regional Studies