SAN FRANCISCO – Nerds are no longer the only ones benefiting from the innovation boom.
Having left the heavy lifting to technology companies until early this year, San Francisco’s non-tech employers are playing a growing role in the city’s labor recovery. Positions in everything from retail to construction to hospitality now comprise about 75 percent of the city’s job growth, helping it add jobs at among the fastest rates in the nation and reduce its unemployment rate to 6.5 percent.
San Francisco’s experience is also seen in broadening expansions in other U.S. technology centers such as Seattle and Boston, easing concerns that innovation would create work for only the most highly skilled and highly paid while others get left behind. Every new technology job in a city creates five additional local jobs outside the sector over time, according to an analysis by Enrico Moretti, an economics professor at the University of California, Berkeley.
People were missing the big picture, said Moretti, author of The New Geography of Jobs published in May. Tech cannot offer jobs to the average worker, but every software engineer attracted to Twitter will indirectly support many more service jobs. My research suggests that this multiplier effect is particularly large for high-tech jobs.
In the face of a manufacturing contraction accelerated by the 2007-2009 recession, even the biggest names in American technology worried knowledge work wouldn’t be able to sustain U.S. employment. Andy Grove, co-founder of Santa Clara, Calif.-based Intel, warned in July 2010 of our own misplaced faith in the power of startups to create U.S. jobs.
The great Silicon Valley innovation machine hasn’t been creating many jobs of late, Grove wrote in an article in Bloomberg Businessweek. What kind of a society are we going to have if it consists of highly paid people doing high-value-added work – and masses of unemployed?
In 2010, computer systems design was the only industry in the San Francisco metropolitan area that added more than 2,000 jobs. The city lost 12,200 positions across all industries.
Two years later, the home of some of the world’s best-known Internet companies, including Twitter and Yelp, has been transformed. Jobs in most major industries, aside from the government, grew in October.