It's notable that a lot of people are moving, but I'd wait until at least early 2022 to make judgements about lasting impacts on SV. WFH might not stick widely, and some firms will pick a hybrid model (i.e. partial WFH) over going fully remote.
Not to mention that few places can match all the benefits of SV, i.e. unenforceable non-competes, fantastic weather and surroundings, an educated and diverse population, cultural activities, very high compensation, etc. I don't think it'll be as easy to displace SV as these articles regularly imply, despite the downsides of living here.
I lived in SV for a decade and worked in SF for most of that.
> WFH might not stick widely
If the vast majority of workers demand it, then I don't think employers will have a choice here. Leaving now is a vote with your feet.
> unenforceable non-competes
Very few of my peers have ever cared about this in practice. I don't think this is remotely a major benefit compared to e.g. state taxes.
> fantastic weather and surroundings
The surroundings, I'll give you, but the weather is "fantastic" in a small number of communities only. SF weather is far from fantastic. I don't miss it. Sunnyvale or RWC, on the other hand... But still. The weather is boring.
What I don't miss are the fires and smoke-filled skies, and the drought.
> an educated and diverse population
The "native bay area" population? Or the migrants and immigrants? The vast, vast majority of people I worked with over the years were from elsewhere. We used to joke that it was rare to hear someone was born in the Bay Area. There's not much weighing people from elsewhere down preventing then from leaving, and there is less and less weight each passing month this year.
> cultural activities
I actually cannot think of anything unique to the Bay here...
> very high compensation
True, but I know plenty of people who have moved to Seattle and New York who make just as much. And I know of several fully remote (pre-pandemic) workers who are making 90% of what they would earn in the Bay Area -- I know, this isn't common, but it's possible.
Honestly, SV has done this to themselves. NIMBYism, insane housing, terrible transit, high taxes. I have no doubt SV will recover, but the rest of the world will prosper at the valley's expense.
> Very few of my peers have ever cared about this in practice. I don't think this is remotely a major benefit compared to e.g. state taxes.
Well, while working in RTP I saw many suits filed for my coworkers for non-compete clauses.
If you're ~director or above, this matters a lot and the bigco's basically auto file the lawsuit in any jurisdiction where enforceable. At least one exec I reported to had to take a year off as a result of these lawsuits.
IMO it's a huge deal for the HQ execs of many companies, similar to how tax benefits are a huge deal to the rank-and-file.
> At least one exec I reported to had to take a year off as a result of these lawsuits.
Yes, it is a bigger issue on both sides of the table when you get to director+ level. The company often has much more to lose, and the employee often has far fewer potential new homes. These things tend to balance out; I've seen contracts with non-compete timeline matched or exceeded by severance timeline for that reason.
Employers aren't a monolithic block. Some companies will switch back to in-person, others will continue WFH policies. If more workers depart for the latter, the former will take notice.
I don't know what percentage of the workforce here has both family and enough personal connections to where leaving the area doesn't make sense, regardless of a WFH policy. It may be that they want a better commute but still want to stay in the area for the aforementioned reasons (I am one of these people).
Yeah, I've had some friends leave (to CO and DC), but I'm skeptical of companies and VCs leaving.
For a kind of funny example, there was an episode of the all-in podcast (mostly a podcast of successful VCs) where they talked about SV politics and leaving.
The irony was while they talked about CA politics to an absurd degree ("worst run state in US", etc.) when they asked each other if they were planning on leaving all of them said no.
People complain a lot (and there are good reasons to complain!), but people have been complaining since at least 1993 and it's still an economic hub for startups. I'm skeptical of that leaving.
I have seen coworkers and friends leave, but it's mostly a housing issue. As people turn 30 and want to have a family if you haven't cashed out $5M in some exit event then it sucks to live here. $500k can get you a nice place in CO, $750k for outside Seattle.
I have had older friends leave to have a family. They went to Santa Cruz, Seattle, Denver, DC, and Austin. It's a shame. The ones that stayed either are very rich where a $5M house is not an issue, or they still live with three roommates and rent without kids.
Some other reasons to complain about, but that I don't think are usually deciding factors for people to leave:
- Bad policy (AB5), Extra founder Tax, Hostility towards tech in general.
- Political monoculture (I don't mean not enough trump people, I mean it can be controversial to be an obama era moderate/neoliberal and 'woke' politics is hard to avoid).
- High state taxes that harm capital gains and new money. This is related to housing and prop13. Not only do the people that live in housing they bought decades ago pay almost no property tax compared to new buyers, they then push to restrict new supply while also pushing to increase tax on new money. This comes in the form of higher capital gains tax (there's a bill to raise it to 16.3% this year retroactively, by far the highest in the country). They also push legislation to increase tax on the companies excluding homeowners to fund their services (which indirectly affects the employees again). This kind of thing makes it doubly hard to be able to buy in and live here.
>> Yeah, I've had some friends leave (to CO and DC), but I'm skeptical of companies and VCs leaving.
>> I have had older friends leave to have a family. They went to Santa Cruz, Seattle, Denver, DC, and Austin. It's a shame. The ones that stayed either are very rich where a $5M house is not an issue, or they still live with three roommates and rent without kids.
Just wait until they look for interesting jobs and get 100 linked in messages from CA and like 1 or 2 from DC. (note: I live in VA just outside DC, speaking from experience.)
An anecdote: I got an offer to leave my mid-level FAANG job to return to the Midwest for a VP role at a 200+ person company. The compensation was about 35% of my total comp, and it was maybe one of 3 companies in the area I would consider working for. Not to mention going back to cold winters, McMansions, and chain restaurants.
I don't think people fully appreciate the value of unenforceable non-competes + many companies congregated in one area. No where else in the world does the labor have this level of negotiating power and flexibility. Even if it can be replicated (and I hope it is!), it won't be overnight.
Agreed. I think it was all OK when I was single. But the appetite to re-locate a family every 2-3 years with a job change (or employer disappearing) (changing friends, school districts, continuity) is a tall order in my humble opinion.
There is an old Russian saying about how every time you move it is like a fire happened (because you lose things.)
Well, this entire premise is that remote work would make that more possible (I personally don't believe this though).
That said, the people I know that left aren't planning to find new work (for the most part). CO does have a lot of FAANG options though and Slack was also there.
They're not looking for the most interesting work at that point, they're looking to keep their job and raise a family - it's a tradeoff.
Isn't that a risk to move to a place without as many employment options? Yes. The reason for that risk is you can raise kids in a nice house for $500k rather than in a tiny, old, 2 bedroom apartment for 1.5M.
>> They're not looking for the most interesting work at that point, they're looking to keep their job and raise a family - it's a tradeoff.
>> Isn't that a risk to move to a place without as many employment options? Yes. The reason for that risk is you can raise kids in a nice house for $500k rather than in a tiny, old, 2 bedroom apartment for 1.5M.
You exactly summarized my thought process three years ago. To be fair, i'm very happy here. But it is a mixed bag.
Housing is great compared to the bay area, but $500k is a stretch for DC/Virginia (check it out on zillow) though not impossible, there is a ton of inventory if you are willing to drive out a bit. Unlike FAANG folks out-buying houses from you, you have lobbyists and government/intelligence contractors outbidding houses from you. Def better than Bay area though.
Except i'm in one of like five growth startups in the area and there are rarely any senior positions open, and the senior workforce appears larger than the pool of interesting senior jobs. Its a huge bet on your employer in addition to the already huge bet you're making w/ taking, say, illiquid early stage stock. So your career growth is much slower.
OK, so what if you are OK w/o an interesting job? Then you have plenty of options. Also, plenty of options if you're willing to be a consultant and travel, but now you're making a 2nd tradeoff.
All in, very happy but not a panacea and certainly multiple tradeoffs.
Yep, agreed - sounds like we have a similar take :).
In my specific case my SO grew up in Cupertino and her family is here, so that's another element that makes it hard to leave. I'm currently doing the live with roommates bit, but it's a hard tradeoff to make.
Also I saw where you work in your HN bio - do you partner with VRAD (or maybe are considering starting your own)? I've always though leveraging ML imaging software as part of a nighthawk radiology service would be really interesting. Basically hire radiologists to be part of the company (give them some equity) and leverage their readings to train the model. In a bit of a Tesla style self-driving play where you're providing the current capabilities via humans, but the ultimate goal is leveraging that to train and improve the software. My dad does neurorad so seemed like a natural fit for deep learning image recognition to me. If you're writing the reading software then you can tailor it for training too.
Unrelated to that, if you're looking for more options in DC the company I work for has a major office there (feel free to connect, my email is in my profile).
I'm the GP commentor, and in my case, theoretically I can, though in my case I have a wife and two children, so it does get tight.
And while I'm grateful for everything I have in life, and I have been given much more than my grandparents abroad...I do wonder -- after struggling through top colleges and a working hard for over two decades with ever increasing responsibility, whether I really "deserve" a 1br or should I aspire to more for my family and me.
I realize it sounds both selfish but also reasonable based on how one looks at things. For now, we've chosen to live very comfortably in DC.
Maybe if those contractors are VP level or DINK; a senior IC working for a Beltway bandit might possibly, with a tailwind, clear 200k total compensation, but that's very much the high end of their pay scale despite the hourly rates they charge the government.
Your experience may be your own; I live just outside of DC as well (though on the MD side) and get bombarded with DC and MD job offers all the time. Perhaps not to the same extent as CA, but saying only 1 or 2 seems like a personal situation.
One more thing for outsiders: Security Clearances are huge here, which really changes outcomes.
@stryan Would love to chat offline if you're open? Really struggling in deciding whether I can continue to live in the region long term, despite being in love with the area and the people.
Not being bored or underutilized at work. Excitement about career opportunities. Room to move upwards.
Hard-tech job opportunities w/o having to regress to an entry-level or mid-level role.
Senior level job opportunities, w/o having to join a consulting firm (i mean, if i'm potentially traveling 4/5 days, i'm not really 'living' here anymore...) I've rolled the dice on management consulting before in my life and spent almost no time in my home city. That was great when I was 20 and not so great with a family. I do wonder whether it is different w/ DC and local projects or whether it might be different in a partyly-WFH future!
Yep, I recently got a call from a FB recruiter in Austin. One constraint was: are you willing to move to the Bay Area to work at the FB campus after lockdown ends? Why yes, I already live here.
Yeah, the previous poster seems to be completely missing out that Austin and Seattle are major tech hubs, Denver is a secondary hub, and Santa Cruz is within spitting distance to Silicon Valley. Seattle alone is probably the second most significant tech region in the country after SV and Austin is easily third or fourth.
Nobody will deny that Bay Area housing is expensive, but even today, $1.5M will get you a decent single family house with a garden in Santa Clara.
That’s a ridiculous amount of money for most, but it’s not in $5M exit territory, and something that’s relatively easy to manage for a 2 tech income family: $1.25M loan is $5600/m mortgage, $1500/m in real estate taxes.
2900ft houses is a good way to skew the argument in your favor, but it's a bit of a strawman: the vast majority of houses in the Bay Area aren't 2900ft to begin with, yet 2000ft house are plenty, with 4 bedroom, on, say, a 6000ft lot. You can easily find one of those for $2M, and they're not shacks.
If you set a minimum year built to 2000 (so up to 20 years old)
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You're right though that there are houses you can find in less desirable areas on the peninsula for around 2 million (and San Jose is cheaper, east bay is cheaper). Usually though there's some tradeoff (bad schools, long commute, house is really old). These tradeoffs don't exist in the other regions where for a a lot less you can live basically anywhere you'd want in a nicer place.
The places I've been looking (Palo Alto, Cupertino, Mountain View) don't really have anything in the price points you're talking about.
I will admit that my general statement about Santa Clara was wrong though (I was thinking mostly about the cities I mentioned as part of Santa Clara county, not the city of Santa Clara).
> Not to mention that few places can match all the benefits of SV
The counterpoint would be how many billionaires, besides those in the tech industry, choose to put down roots in the Bay Area? Not many at all. (The only real exceptions I can think of are Napa/Sonoma/Marin, not SV/SF proper.) We're talking about a class of people who are truly unconstrained in terms of location, so that should be pretty indicative of where local amenities really shine.
And it's pretty clear that New York, SoCal, and Southern Florida are the truly attractive locales in America. Many people choose to pay Manhattan, Beverly Hills or Palm Beach prices without a compelling economic draw to those areas. Virtually nobody chooses to pay SF prices just for the lifestyle, amenities and culture.
Without the draw of tech employment and investment, there's no way SV/SF can maintain its current level of economic prosperity.
People with means tend to locate in tax havens, not places that have good amenities. Presumably with sufficient resources, you can produce any sort of amenity you'd like.
No; People with means tend to declare a residence in a Tax Haven. Which they use to observe profits. I.e. Registering their personal corp in WY, NV, or MD. Then recognizing all profits for themselves under a Corp/LLC and being taxed at WY, NV, or MD results.
Then they proceed to live wherever they want and buy items using Corp/LLC Funds. When they need to use personal funds or pay income tax - They minimize their tax impact through various methods.
Point being - The people live where they want regardless of tax haven status. They recognize revenue in a Corp/LLC in a tax haven.
Wfh will not stick. Managers hate it. If you are really talented you can work anywhere for whatever price you want, however most people are not like that and can only really function meeting often in person.
So if people don't care what managers think why would the owners bother having them? It seems shortsighted to think that management won't have a say, explicitly or implicitly, in guiding these orgs back to an office based workspace.
Managers are nothing but employees. Same as developers and other groups. The owners might consider their opinions along with the opinions of the other groups. There is nothing special about managers. And it is the owners who decide how and what to spend their money on. Not the managers.
>"..won't have a say, explicitly or implicitly..."
Nice try. What are you implying under "implicitely"? If this is what I think it is, the managers are just as replaceable. Often it is actually easier for the owners to replace/get rid of a manager than from good salesperson/developer/etc.
Managers are very often (especially in a bigger organization) is the only channel how information flows to owners.
As a result, managers can paint very different picture of the same situation (as an example, that people working remotely from home are less productive).
May be in some abstract world, "managers are just employees and there is nothing special". In reality they wield a lot of power to sway company in one or another direction.
>"As a result, managers can paint very different picture of the same situation..."
What you describing is a fraud. In a big organization managers are not uniform group, there are multiple levels and factions. They will happily report on each other if the picture is grossly distorted. There are also a lot of metrics and built in controls in big orgs that can and are being used to estimate how particular policy affects the bottom line (profitability).
In reality there are companies whose bottom line did suffer from WFH and there are companies that had actually have profits increased as the result. If you think the latter group will revert because some low level managers feel insecure about their position I have a bridge to sell.
The services and products companies have been delivering during the pandemic were developed largely before the pandemic. Owners can see this. It’s not just low level managers, rather it’s about middle managements perspective in general.
Management and cross organizational relations rely on rapport and relationships amongst baby boomers and Gen X people who greatly prefer in person interaction. Maybe engineers won’t come back to the office, but they sure will be.
Calling SV compensation “very high” seems short-sighted these days if you don’t already own a house here (and assuming you want to own your own house).
The compensation just won’t seem so great when you’re paying off millions on a mortgage and wondering if the industry will still employ you once you’ve got a few gray hairs.
For years, Intel had a ~+20% geographic compensation adjustment for people who lived in the bay area. Not sure if it still exists, but if you were smart about it, and worked in San Jose, you could pocket quite a bit of bonus $$$ that you wouldn't have access to if you worked in, say, Chandler, AZ or Folsom, CA Intel sites.
The contrary might also be true: For many companies it's currently impossible (due to COVID) to make the big accomodations required for going comlpetely remote, including moving their HQs to other places for reasons having to do with access to capital or taxation.
Not to mention that few places can match all the benefits of SV, i.e. unenforceable non-competes, fantastic weather and surroundings, an educated and diverse population, cultural activities, very high compensation, etc. I don't think it'll be as easy to displace SV as these articles regularly imply, despite the downsides of living here.