The Economist reports that after years of explosive growth, Silicon Valley may be beginning to wane. Last year San Francisco county lost population. As Americans leave Silicon Valley, it is a sign of caution for the tech industry and the economy in general. The Economist’s Leaders write:
Last year more Americans left the county of San Francisco than arrived. According to a recent survey, 46% of respondents say they plan to leave the Bay Area in the next few years, up from 34% in 2016. So many startups are branching out into new places that the trend has a name, “Off Silicon Valleying”. Peter Thiel, perhaps the Valley’s most high-profile venture capitalist, is among those upping sticks.
“LIKE Florence in the Renaissance.” That is a common description of what it is like to live in Silicon Valley. America’s technology capital has an outsize influence on the world’s economy, stockmarkets and culture. This small portion of land running from San Jose to San Francisco is home to three of the world’s five most valuable companies. Giants such as Apple, Facebook, Google and Netflix all claim Silicon Valley as their birthplace and home, as do trailblazers such as Airbnb, Tesla and Uber. The Bay Area has the 19th-largest economy in the world, ranking above Switzerland and Saudi Arabia.
There are signs that the Valley’s influence is peaking (see Briefing). If that were simply a symptom of much greater innovation elsewhere, it would be cause for cheer. The truth is unhappier.
If Silicon Valley’s relative decline heralded the rise of a global web of thriving, rival tech hubs, that would be worth celebrating. Unfortunately, the Valley’s peak looks more like a warning that innovation everywhere is becoming harder.
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