No Silicon Valley Exodus After All? But 'Carnage' of the Poor is Expected
By Erika Dickinson
New data show little proof that there is a Silicon Valley exodus, as previously reported. Instead, something much more sinister seems to be happening.
No Silicon Valley Exodus as Alleged
It appears that record-breaking investment in startups and booming market caps for Big Tech are being witnessed as the region's poor residents massively suffers from the relentless economic effects of the COVID-19 pandemic, as reported by Market Watch.
Despite reports of an alleged exodus, Silicon Valley is still the tech capital of the world. This might because the exodus is not even real. New data revealed there had been continuous investment in the industry in 2020 and no overall declines in jobs and population in the region, at all.
Instead, it appears that only rich executives and investors like Elon Musk and companies like Oracle Corp. ORCL, -1.51% and Hewlett Packard Enterprise Corp, are the ones leaving.
Their action may have have raised questions about the future of California's tech powerhouse, but an annual report out this week revealed no such trend.
"I think we can all calm down," Rachel Massaro, Joint Venture's director of research, explained in a news briefing regarding the index.
"We're a place of innovation. We're a place that houses these impactful companies. We have not seen any significant losses among them," he added.
Gap Widens Between Haves and Have-Nots
Rather, the major effect of the COVID-19 pandemic on the San Francisco Bay Area in 2020 was the widening of the divide between the wealthy and the poor, thanks to all the money still flowing in - but only to very selected few. The poorer communities, the ones ravaged by the pandemic, found no wealth has been trickling down to them at all.
"Today, we must frankly admit that the pandemic has made the rich richer while the poor are dying," said Russell Hancock, chief executive of Joint Venture Silicon Valley. Many have lost their jobs and no longer know what to do next.
"The pandemic wiped out our service sector and in-person economy," Hancock revealed. "There's real carnage out there. People have lost their livelihoods," he added.
Record-breaking venture capital investment has been made in Bay Area startups all this time, apart from radically growing market capitalizations for public tech companies. Some standard-setting initial public offerings have also been witnessed already. This creates a false illusion that the Bay Area is not affected by the pandemic, but this is not true too, exodus or not.
Even though an overall out-migration was noticed in San Francisco, most of those who left the most prominent city in the region last year stayed in the state, based on the data provided by the U.S. Postal Service.
Hancock added that Silicon Valley is a "Tale of two cities," given two different scenarios seem to be playing out because of the COVID-19.