10 ms·

Bay Area tech boom not cause of region's problems

39 points by kunle 13y ago

kunle 13y ago
The most striking figure in here is this one: "The hard truth is that the Bay Area's housing and transit systems are bursting at the seams. According to the San Francisco Apartment Association, last year the city added 68,000 new jobs and just 120 new housing units. Silicon Valley's rental vacancy rates are even lower than the city's." That's math that just undeniable.
- nb13 13y ago
  This one really jumped out at me too. I haven't read this anywhere before: "research from the Bay Area Council Economic Institute showed that each of these tech jobs had an astounding effect of creating an additional 4.3 jobs in the local economy."
  - kunle 13y ago
    Yeah I thought that was striking as well. I'm generally skeptical of stats like this but I'd love to see the paper and see the structure of those gigs (eg which industries, where geographically are they concentrated etc)
    - nb13 13y ago
      I found it. It's mentioned on page 5 in the executive summary. I don't have enough time to read through the whole report right now. http://www.bayareaeconomy.org/media/files/pdf/TechReport.pdf http://www.bayareaeconomy.org/media/files/pdf/TechReport.pdf
- rayiner 13y ago
  For comparison, Chicago, a city that isn't growing like SF, added 1,150 housing units in 2012 and had 3,050 units under construction for delivery in 2013-2014 as of September 2012: http://articles.chicagotribune.com/2012-09-13/classified/ct-home-0914-new-apartments-20120913_1_rental-units-apartment-units-rental-development http://articles.chicagotribune.com/2012-09-13/classified/ct-....
epicureanideal 13y ago
Although I generally agree with the sentiment of the article, I strongly disagree that we need specifically "affordable" housing. State-subsidized "below market rate" housing that enables people with low salaries to occupy highly-demanded space is incredibly inefficient and also likely doesn't serve the interests of the people it is supposed to help. I don't see why the ability to live in San Francisco is any different than the ability to afford a BMW or a Tesla. Should the government subsidize "below market rate" luxury cars too? What would be the incentive to get an education or work hard? Personally I feel somewhat offended when there are dozens of below market rate units available and I'm actually excluded from attempting to buy them because I earn too much money. Meanwhile there are hardly any homes available for people who can afford the houses without subsidies and we bid up the houses to obscene prices due to lack of supply. Also, if the people who work in SF or other high income areas cannot afford to live there at current wages, there should be pressure on them to leave and work elsewhere. This would increase demand for their labor and drive prices up, all else being equal. (I know, there are other factors here, but those should be dealt with separately, not by adding more layers of complexity to the problem.) Further, if those workers cannot afford to rent or buy, lowering the cost of renting or buying also reduces the pressure on employers to raise their wages.
- TheEzEzz 13y ago
  > Should the government subsidize "below market rate" luxury cars too? People have families and lives built around geographic locations, not cars. I'm not saying we should or shouldn't subsidize housing (I lean libertarian personally), but it's disingenuous to suggest this is like the car market. What's at stake for many people is a foundational part of their lives.
  - epicureanideal 13y ago
    They can build families and lives somewhere else if they can't afford to live here, right? Do people have a fundamental right to raise a family in San Francisco rather than Omaha or Austin? Are other places so horrible that we should use taxpayer money to ensure that the largest number of people possible can live in SF? And we should make it easier for the moderately low income to live here rather than people with higher income because ... why? Because people who work in technology don't deserve to raise their families here? Because despite education and hard work we really should make the ability to raise a family in a great area a random selection? I actually think the car analogy is useful. Not subsidizing housing in San Francisco does not deny people the ability to start families. They can still start them in many other fine places that they can afford. Not driving a BMW or Tesla doesn't deny people the ability to get to work. A Honda or Toyota does that just as well. NOTE: "Affordable housing" does not apply exclusively to people who have lived in the area for N years previously as far as I know, and even if it did I don't see why that would be fair. If you rent, you rent. When your lease is up, if the price goes up, that's how rent works. Also, there are already rent control policies that would serve this purpose.
radley 13y ago
"tech's shuttles are a godsend, eliminating 327,000 cars" That doesn't seem accurate. Over a third of San Francisco's population leaves town on tech buses?
- cloudwalking 13y ago
  "tech's shuttles are a godsend, eliminating 327,000 cars and 10,000 tons of carbon every year at no cost to the taxpayer" I presume this means 327,000 car trips per year.
  - sethhochberg 13y ago
    That seems much more reasonable - assuming 260 work days a year and 2 trips per day, we'd be looking at just under 450 cars off the roads due to shuttles.
timr 13y ago
So, first off, it needs to be acknowledged that this was written by the "Bay Area Council", which is a PR machine for a dues-paying group of bay area corporations, including Facebook and Google [1]. Consider the source. Second, while I'm the first to acknowledge that SF needs to build up, it's clearly absurd to say that the tech boom is "not the cause" of the city's housing problems -- that's like saying that skiing isn't the cause of Aspen's housing prices. Nonsense. It's plain that tech is the proximal cause, even if you believe that the boom has brought both positive and negative consequences to the city (as I do). Fair debate on this topic has to begin with the acknowledgement that the tech companies' policies are indirectly driving a displacement of non-tech workers from the city. It's dishonest to claim otherwise. [1] http://www.bayareacouncil.org/about-us/member-companies/ http://www.bayareacouncil.org/about-us/member-companies/
- surrealize 13y ago
  > It's plain that tech is the proximal cause It's half of the proximal cause. Housing prices have increased because of the interaction of supply and demand. Blaming the tech boom focuses only on the demand side, but the supply constraints (height limits, zoning density limits, etc.) are just as important.
  - timr 13y ago
    The supply didn't decrease. The demand increased. That's the proximal cause.
    - surrealize 13y ago
      If you like. The policy levers are all on the supply side, though (unless you want to start kicking out major employers or something). So it's pointless to complain about demand side changes.
      - timr 13y ago
        "The policy levers are all on the supply side, though" Are you kidding? Remember the big white buses that everyone is mad about? They play a role here. The valley tech companies have mitigated the natural barrier that would ordinarily limit the number of tech employees living in the city -- the pain of commuting. So rather than staying close to work and building communities where they live, they use the city as a glorified suburb, but with cushy private transportation. There are a variety of things wrong with this, not the least of which is the fact that they reduce housing supply for the natives. Econ 101 theories about supply and demand don't apply when large external forces are subsidizing the demand side of the equation. One can quite reasonably argue that instead of "building up" (which is expensive and disruptive) SF should just ban the private buses -- it would be cheaper, more natural, and would solve the same problem.
wpietri 13y ago
This just in: young PR guy for for business lobby group thinks business is awesome.

39 points by kunle 13y ago

kunle 13y ago

The most striking figure in here is this one: "The hard truth is that the Bay Area's housing and transit systems are bursting at the seams. According to the San Francisco Apartment Association, last year the city added 68,000 new jobs and just 120 new housing units. Silicon Valley's rental vacancy rates are even lower than the city's." That's math that just undeniable.

nb13 13y ago
This one really jumped out at me too. I haven't read this anywhere before: "research from the Bay Area Council Economic Institute showed that each of these tech jobs had an astounding effect of creating an additional 4.3 jobs in the local economy."
- kunle 13y ago
  Yeah I thought that was striking as well. I'm generally skeptical of stats like this but I'd love to see the paper and see the structure of those gigs (eg which industries, where geographically are they concentrated etc)
  - nb13 13y ago
    I found it. It's mentioned on page 5 in the executive summary. I don't have enough time to read through the whole report right now. http://www.bayareaeconomy.org/media/files/pdf/TechReport.pdf http://www.bayareaeconomy.org/media/files/pdf/TechReport.pdf
rayiner 13y ago
For comparison, Chicago, a city that isn't growing like SF, added 1,150 housing units in 2012 and had 3,050 units under construction for delivery in 2013-2014 as of September 2012: http://articles.chicagotribune.com/2012-09-13/classified/ct-home-0914-new-apartments-20120913_1_rental-units-apartment-units-rental-development http://articles.chicagotribune.com/2012-09-13/classified/ct-....

epicureanideal 13y ago

Although I generally agree with the sentiment of the article, I strongly disagree that we need specifically "affordable" housing. State-subsidized "below market rate" housing that enables people with low salaries to occupy highly-demanded space is incredibly inefficient and also likely doesn't serve the interests of the people it is supposed to help. I don't see why the ability to live in San Francisco is any different than the ability to afford a BMW or a Tesla. Should the government subsidize "below market rate" luxury cars too? What would be the incentive to get an education or work hard? Personally I feel somewhat offended when there are dozens of below market rate units available and I'm actually excluded from attempting to buy them because I earn too much money. Meanwhile there are hardly any homes available for people who can afford the houses without subsidies and we bid up the houses to obscene prices due to lack of supply. Also, if the people who work in SF or other high income areas cannot afford to live there at current wages, there should be pressure on them to leave and work elsewhere. This would increase demand for their labor and drive prices up, all else being equal. (I know, there are other factors here, but those should be dealt with separately, not by adding more layers of complexity to the problem.) Further, if those workers cannot afford to rent or buy, lowering the cost of renting or buying also reduces the pressure on employers to raise their wages.

TheEzEzz 13y ago
> Should the government subsidize "below market rate" luxury cars too? People have families and lives built around geographic locations, not cars. I'm not saying we should or shouldn't subsidize housing (I lean libertarian personally), but it's disingenuous to suggest this is like the car market. What's at stake for many people is a foundational part of their lives.
- epicureanideal 13y ago
  They can build families and lives somewhere else if they can't afford to live here, right? Do people have a fundamental right to raise a family in San Francisco rather than Omaha or Austin? Are other places so horrible that we should use taxpayer money to ensure that the largest number of people possible can live in SF? And we should make it easier for the moderately low income to live here rather than people with higher income because ... why? Because people who work in technology don't deserve to raise their families here? Because despite education and hard work we really should make the ability to raise a family in a great area a random selection? I actually think the car analogy is useful. Not subsidizing housing in San Francisco does not deny people the ability to start families. They can still start them in many other fine places that they can afford. Not driving a BMW or Tesla doesn't deny people the ability to get to work. A Honda or Toyota does that just as well. NOTE: "Affordable housing" does not apply exclusively to people who have lived in the area for N years previously as far as I know, and even if it did I don't see why that would be fair. If you rent, you rent. When your lease is up, if the price goes up, that's how rent works. Also, there are already rent control policies that would serve this purpose.

radley 13y ago

"tech's shuttles are a godsend, eliminating 327,000 cars" That doesn't seem accurate. Over a third of San Francisco's population leaves town on tech buses?

cloudwalking 13y ago
"tech's shuttles are a godsend, eliminating 327,000 cars and 10,000 tons of carbon every year at no cost to the taxpayer" I presume this means 327,000 car trips per year.
- sethhochberg 13y ago
  That seems much more reasonable - assuming 260 work days a year and 2 trips per day, we'd be looking at just under 450 cars off the roads due to shuttles.

timr 13y ago

So, first off, it needs to be acknowledged that this was written by the "Bay Area Council", which is a PR machine for a dues-paying group of bay area corporations, including Facebook and Google [1]. Consider the source. Second, while I'm the first to acknowledge that SF needs to build up, it's clearly absurd to say that the tech boom is "not the cause" of the city's housing problems -- that's like saying that skiing isn't the cause of Aspen's housing prices. Nonsense. It's plain that tech is the proximal cause, even if you believe that the boom has brought both positive and negative consequences to the city (as I do). Fair debate on this topic has to begin with the acknowledgement that the tech companies' policies are indirectly driving a displacement of non-tech workers from the city. It's dishonest to claim otherwise. [1] http://www.bayareacouncil.org/about-us/member-companies/ http://www.bayareacouncil.org/about-us/member-companies/

surrealize 13y ago
> It's plain that tech is the proximal cause It's half of the proximal cause. Housing prices have increased because of the interaction of supply and demand. Blaming the tech boom focuses only on the demand side, but the supply constraints (height limits, zoning density limits, etc.) are just as important.
- timr 13y ago
  The supply didn't decrease. The demand increased. That's the proximal cause.
  - surrealize 13y ago
    If you like. The policy levers are all on the supply side, though (unless you want to start kicking out major employers or something). So it's pointless to complain about demand side changes.
    - timr 13y ago
      "The policy levers are all on the supply side, though" Are you kidding? Remember the big white buses that everyone is mad about? They play a role here. The valley tech companies have mitigated the natural barrier that would ordinarily limit the number of tech employees living in the city -- the pain of commuting. So rather than staying close to work and building communities where they live, they use the city as a glorified suburb, but with cushy private transportation. There are a variety of things wrong with this, not the least of which is the fact that they reduce housing supply for the natives. Econ 101 theories about supply and demand don't apply when large external forces are subsidizing the demand side of the equation. One can quite reasonably argue that instead of "building up" (which is expensive and disruptive) SF should just ban the private buses -- it would be cheaper, more natural, and would solve the same problem.

wpietri 13y ago

This just in: young PR guy for for business lobby group thinks business is awesome.