SAN JOSE, Calif. (KGO) -- Traffic congestion is one of the thorny issues we deal with on a daily basis. One in six Silicon Valley workers spends two hours or longer each day behind the wheel. Yet, 2,400 new companies opened offices or facilities here over the past two years, drawing in an estimated 2,000 new residents.
"Given how expensive it is here, why do people keep coming here?" asks Greg Becker, president and CEO of Silicon Valley Bank as well as chairman of the Silicon Valley Leadership Group. One of the reasons, he says, is worker productivity, measured by annual output per worker. It was 17 percent higher than second-place New York and 62 percent higher than the national average in 2013.
The Silicon Valley Leadership Group, along with the Silicon Valley Community Foundation, spent 15 months mining data to find out the region's strengths and weaknesses comparing statistics for five competing tech centers, Southern California, Seattle, Austin, New York and Boston.
Strengths included the number of patents filed by Silicon Valley innovation companies, the pool of trained STEM (science, tech, engineering and math) workers, and access to venture capital.
Another strength, the study suggests, underscores the importance of immigration reform to support economic vitality. Look around and you can see how diverse our talent pool is. Ninety-seven percent of new residents to the Valley in 2013 came from abroad and only three percent came from other parts of the U.S.
Just over half, 56 percent of all Silicon Valley STEM workers with a minimum bachelor's degree are foreign born, while one in five was born in California. That makes this region dependent on immigrant workers. The report's sponsors are sitting with with freshman state and federal legislators in the weeks ahead to urge them to take action to help support the immigrant talent pool. Meetings will also be held with local government officials.
"They have two-year legislative sessions," points out Carl Guardino, president and CEO of the Silicon Valley Leadership Group. "The clock is ticking. Where are we in moving the ball in these key areas to be more competitive over the next two years?"
The data also highlight a key reason why today's students won't be able to fill tech jobs in the future. Only 59 percent of third graders in California are testing "proficient" in reading, while only 54 percent of eighth graders are proficient in algebra, a course commonly required for college entry. Underperforming educational achievement could hurt Silicon Valley's future competitiveness.
Quality of life issues also were compared among the six tech centers. Silicon Valley had the highest median cost for existing homes at $470 per square foot; the lowest was $191 per square foot in the Seattle area. Southern California ranked second behind Silicon Valley at $335 per square foot. New York and Boston were tied at $230.
While the focus of the study appears to be on the technology sector, the Silicon Valley Community Foundation's CEO and President, Emmett Carson Ph.D., points out that for every one job created in the tech sector, five others are created in non-tech areas. Quality of life issues, such as traffic, education and housing costs, also impact lower income residents in the Valley.
"At the wage you have, can you have a quality standard of life?" asks Carson. "Can you have good housing? Can your have your kids in a school? Will you have health care? That's what we need to be intentional about."
The research was conducted by Collaborative Economics, based in San Mateo. The full report can be viewed on the website of the Silicon Valley Competitiveness and Innovation Project.
Report underscores why Silicon Valley remains top tech center
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