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Tuesday, April 5, 2016

If Tech Is Dying In SF, Which City Is Becoming the Next SF?

Posted By on Tue, Apr 5, 2016 at 2:51 PM

charlton_heston_th_3126489b.jpg

Since today ends with -day, it’s another chance to write the eulogy for San Francisco’s tech industry. But perhaps this one should come with a footnote about resurrection.

The latest story about tech jobs — and the people working them — leaving the Bay for greener pastures comes via Bloomberg (which, coincidentally, was itself recently hiring in the city).

This story came with data: Three other cities — Seattle, Portland, and Phoenix — outpaced San Francisco in year-over-year tech sector growth for the month of February. Not too far behind San Francisco were Los Angeles and Austin, Texas. And, not surprisingly, each of those cities is far cheaper to live in — even L.A.

So if San Francisco is becoming the next Detroit (that’s called hyperbole, folks), which city is becoming the next San Francisco? Hard to say. None of these stories really touch on that, probably because they’re largely written for a business-minded audience that doesn’t care, doesn’t have a pulse, lives only for wealth, hates poor people, or all of these. But since we care, we’re going to play our own game of gentrification.

click to enlarge After the tech rush. - USGS.GOV
  • USGS.gov
  • After the tech rush.
Let’s skip Portland and Seattle; they’re already too much like San Francisco, or vice versa. Plus, Oregon’s utter hatred of all things California is not cute or funny anymore, it’s just scary. And Seattle is where Tim Lincecum grew up, so yay Seattle.

L.A., like New York, is probably too big to see the kind of insane cost of living spikes that happened here. That’s not to say both cities are really any less expensive to live in than San Francisco, but you can still find niche markets in either one because they’re both large enough to support economic diversity. Here, Niche Market is the name of a new craft cocktail lounge in the Tenderloin.

Phoenix is an interesting case. It’s dirt cheap to live there, although home prices have gone up quite a bit in the past year and the median now stands at $190,000. That’s the going rate for a shed in the Bay Area. And, of course, you’d be trading the sands of the Pacific Coast for sands that harbor scorpions. And the politics? Well, if you like liberal ideals, even just a smidgen, Arizona might not be for you.

A bit farther east in Texas is Austin, which seems like a pretty cool place to live. But if tech invades like it did in San Francisco, will it be possible to keep Austin weird? Austin is also pretty small population-wise, about the same as San Francisco, and anchors a larger metro area, like San Francisco. Uh oh.

But wait, tech already invaded Austin. “The Austin Technology Council expects 11,754 new tech jobs will be added to the mix over the next five years,” according to Forbes, which also pointed out that there was a “41.4% jump in tech-industry employment between 2001 and 2013.” Yikes.

Yet Austin is still Austin. How?

Maybe this guy is on to something. He lived in both cities, and he thinks San Francisco is just too intense — so much so that it will always exist in a bubble (figuratively, folks) and Austin will never become San Francisco. OK, well that’s just his opinion.

If San Francisco is living in a bubble, maybe some sanity will return to the housing market. Maybe …
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Max DeNike

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