San Francisco's tech-driven economic boom has outstripped the majority of the country when it comes to creating new jobs since the onset of the Great Recession, according to a new study.
“Since the Great Recession started in 2007, San Francisco itself — a city of 825,000 — has generated more private sector jobs than 47 out of 50 states,” according to the study by Michael Mandel of South Mountain Economics.
Only Texas, New York and North Dakota created more jobs during this period than The City, whose economy was led mainly by a tech sector that has grown by 45 percent since 2010.
San Francisco has seen 67,000 private-sector jobs created — 21,000 in the tech industry — since 2010, helping to make it the second-fastest-growing large county in the country, according to the study.
And while some San Franciscans may complain about the tech boom and its impacts on issues such as housing, most are in favor of the tech trend, according to a recent survey. Despite continued worries about the rising cost of living, 53 percent of respondents said the tech sector had helped the local economy and provided more opportunities. The Boston Consulting Group survey, while showing a positive view of tech and its workers, was not all so glowing.
Only 33 percent said tech companies give back to The City, and 68 percent said wealthy tech workers are pushing out others, making The City an “exclusive community.”
Office spaces filling up and rising buildings are ever-present reminders of The City's continuing economic health. But if history is any judge, things could turn.
Indeed, venture capitalist George Zachary told Bloomberg West television Thursday that there is a possible tech bubble forming.
“We are in bubble territory,” he said on air. “If you notice, very few people say we're in bubble territory. I will say it. No one wants to say it because no one wants to break it. Everyone wants to cash out before it's over.”
Those warnings seemed to be reflected in Thursday and Friday's tech stock sell-off, which led to a drop in the Dow Jones Industrial Average of almost 1 percent.
Still, the South Mountain Economics study cautioned that a repeat of the early 2000s dot-com crash is unlikely this time around.
“Many San Francisco residents still have searing memories of the dot-com collapse, which sent the unemployment rate soaring. The worry is that when the current tech boom ends, it will leave empty buildings, shuttered restaurants, and vacant streets,” noted the study.
There are two reasons that history likely won't be repeated, according to the study's author:
First, the dot-com bust was felt so widely because it came at the same time as a financial crisis at the turn of the century. Second, the current boom is not driven by debt as was the previous one.