This month Joint Venture Silicon Valley (JVSV) in partnership with the Silicon Valley Community Foundation (SVCF) presented the 2014 State of the Valley Index in San Jose, CA.
Since 1995, the Silicon Valley Index has measured economic growth (such as job, income, entrepreneurship and innovation, and more), societal conditions (education, health, safety, arts and culture), place (environment, transportation, land use and housing), as well as governance (city finances, civic engagement, voter participation, etc.)
Russell Hancock, President and CEO of JVSV talked about Silicon Valley’s performance as the leader of the nation in most measures. The valley has seen a four year continuous growth in jobs and income, where as a region, it is among the highest income zones in the nation. Further, Silicon Valley holds the biggest share of the nation’s high growth, high wages sectors.
How can we define Silicon Valley and what are the regional boundaries?
The Silicon Valley Index looks at an area that includes forty cities in a defined geographical region in the greater San Francisco Bay Area. JVSV includes several counties: Santa Clara, San Mateo, Santa Cruz and Alameda. For some of the measures, the index also encompasses the major three cities: San Jose, San Francisco and Oakland, totaling a geographic area of over 1800 square miles with a population close to three million people.
How are we doing?
Employment in Silicon Valley today exceeds pre-recession levels. Although there is job growth in Silicon Valley, it cannot be considered as the only measure to gauge economic health and prosperity. Last year, 104,065 new jobs were created in the region. To compare, the highest new jobs we saw in Silicon Valley has been in the Dot-Com era, which generated around 110,00 new jobs at its highest. In the second quarter of 2013, for example, there was a 34% increase in employment over the same time period in the previous year – the largest jump in growth in the past decade. But there is a difference from the Dot-Com time: in the past 4 years, we have seen incremental growth each year, indicating a steady job growth. The job growth rate in Silicon Valley now is 3.8% versus the national average of 2%. Further, job creation today spreads across all industries, which is an indication of good and healthy economic growth.
The report tracks down unemployment rates on a monthly basis. Silicon Valley unemployment rates fell from 7.5% in January 2013 to 5.8% in November last year. These rates were lower than the state’s and the nation’s rates.
Silicon Valley is most synonymous with innovation. When it comes to patent registration, six out of the top ten cities generating patent registrations in the U.S. are here, where patents span over diverse industries.
There has been more venture capital spent in Silicon Valley than other areas in the nation: 39% in 2013. When adding San Francisco, it represents 77% of investments in California alone. Most of the investments were in software, energy efficiency, bio technology, medical devices, and more.
In the green technology fields, venture capital investments in Silicon Valley accounted to 76.6% of overall Cleantech investment in California. In fact, the Cleantech revolution has shrunk here in 2013, in particular solar funding, but it is starting to grow again. While in the past decade, most Silicon Valley’s Cleantech investments were in solar, today we see venture and angel funding of several ‘green’ sectors: energy efficiency, Hydro, energy storage or batteries, fuel cells, and more.
In the past few years more residents, private and public businesses, non-profit organizations, as well as government facilities (for example, schools), have been gradually moving into renewable energy sources, in particular roof-top solar. At the same time, electricity usage per capita has decreased. Water consumption has been consistently declining since 2000. Recycled water, as a percentage of total water consumption, has increased to 4.1%.
While permitting time for renewable energy projects has decreased in the past two years for all Cleantech sectors, electric vehicle charging stations installations are the only exception to faster permitting. In addition, there is a decrease in Vehicle Miles Traveled per capita, attributed to an increased ridership in public transit, carpooling, shared rides, etc. At the same time, more employees work from home, reducing traffic and carbon emissions. In fact, the report shows that ridership on CalTrain and VTA (Valley Transportation Authority) Express service have grown significantly.