Why Hasn’t Silicon Valley Fixed the Bay Area’s Problems?
Two books examine the dark side of capitalism’s effect on urban development.
Illustration: Jing Wei for Bloomberg
The San Francisco Bay Area is the most affluent major urban region in the US, and it keeps getting richer. Annual real GDP growth from 2019 to 2023 was 5.3% in the San Jose metropolitan area and 3.5% in metro San Francisco, compared with 2.3% nationally. The Bay Area accounted for 46% of US venture capital investment in 2024, its highest share ever. Not to mention great scenery and great weather.
Yet the region’s population has been falling, with hundreds of thousands of residents decamping for elsewhere in California and the US since early 2019. Employment is still below its pre-pandemic level in the San Francisco area, and only slightly above it in metro San Jose. Prominent businesses and entrepreneurs have left, and San Francisco’s commercial vacancy rate is now a highest-in-the-nation 34.2%. The city has become a byword for urban dysfunction. As a New Yorker who visits frequently (I grew up in the East Bay), I think that’s been exaggerated — but it’s not totally unwarranted.