I don’t think the booming investment will do much for California directly. I’m quite certain that’s mainly data centers and while Silicon Valley is a key market, most of the development is outside of California. I’m sure there are knock on effects — obviously people have to design the software and services that run on the data center server, but that’s second order.
Since work from home has exploded in tech since the pandemic and since we make homes far too expensive where tech jobs congregate, it seems likely that more CA tech workers are working for CA tech companies from out of state. Can we account for this? Or does it matter what state a firm is headquartered in if the payroll is being spent and taxes being paid out of state?
This is fascinating. I wonder to what extent remote work contributed to this. California's relatively high cost of living was already driving away workers by 2019 but if anything low interest rates in 2020 - 2021 would have helped, at the start of the recession.
To be clear, are these stats all based on the residence of workers? It's a little ambiguous nowadays to say "California has X many jobs." A job is a relationship between an employer and a worker, who could just as easily be in different states from each othwr. Does a California employer letting their workers move to Texas count as "jobs moving to Texas"? I'm assuming yes but I can't always tell, and I'm not entirely sure these government surveys distinguish that perfectly clearly.
These stats aren’t based on residence of workers per se, but place of the work establishment. So someone who lives in New Jersey but works in New York is counted as a New York job, but a California employer allowing remote work from Texas counts as a Texas job (the California employer then functionally has an establishment in Texas)
Those information sector jobs moving between California and New York are not tech jobs, it’s mostly people working in media and entertainment, always have to be careful with this sector, really need sub sector data to know what is going on
What is a tech job? Increased scope and requirements for tech skills across the economy would mean a lower relative ratio of CA tech jobs without a single job actually leaving the state.
This leaves out shipping H1-B workers back to their home countries (mostly India). The tech-session left a lot of Desi workers without employee sponsors. They didn't move to Texas!
2. Defense industry policy of "no single source parts" created competing companies down the road. AMD exists because of this! Intel used to courier schematics across town to AMD because the DoD would not buy the chips otherwise.
Nice overview of the trends. Personally, I think this is the beginning of a major shift in the geographical location of digital technology jobs.
I don’t think the booming investment will do much for California directly. I’m quite certain that’s mainly data centers and while Silicon Valley is a key market, most of the development is outside of California. I’m sure there are knock on effects — obviously people have to design the software and services that run on the data center server, but that’s second order.
Excellent work, thank you.
Since work from home has exploded in tech since the pandemic and since we make homes far too expensive where tech jobs congregate, it seems likely that more CA tech workers are working for CA tech companies from out of state. Can we account for this? Or does it matter what state a firm is headquartered in if the payroll is being spent and taxes being paid out of state?
This is fascinating. I wonder to what extent remote work contributed to this. California's relatively high cost of living was already driving away workers by 2019 but if anything low interest rates in 2020 - 2021 would have helped, at the start of the recession.
To be clear, are these stats all based on the residence of workers? It's a little ambiguous nowadays to say "California has X many jobs." A job is a relationship between an employer and a worker, who could just as easily be in different states from each othwr. Does a California employer letting their workers move to Texas count as "jobs moving to Texas"? I'm assuming yes but I can't always tell, and I'm not entirely sure these government surveys distinguish that perfectly clearly.
These stats aren’t based on residence of workers per se, but place of the work establishment. So someone who lives in New Jersey but works in New York is counted as a New York job, but a California employer allowing remote work from Texas counts as a Texas job (the California employer then functionally has an establishment in Texas)
Those information sector jobs moving between California and New York are not tech jobs, it’s mostly people working in media and entertainment, always have to be careful with this sector, really need sub sector data to know what is going on
30 years ago they lost all the Aerospace jobs. Then came the internet. What’s next?
FAFO I guess
What is a tech job? Increased scope and requirements for tech skills across the economy would mean a lower relative ratio of CA tech jobs without a single job actually leaving the state.
This leaves out shipping H1-B workers back to their home countries (mostly India). The tech-session left a lot of Desi workers without employee sponsors. They didn't move to Texas!
Going where? To TX for freedom and guns? 😉 TX is laying off people too, FYI.
California will be fine as long as it bans noncompetes: https://news.bloomberglaw.com/daily-labor-report/did-californias-noncompete-ban-fuel-silicon-valley-innovation
Silicon Valley came from:
1. Snotfrad
2. Defense industry policy of "no single source parts" created competing companies down the road. AMD exists because of this! Intel used to courier schematics across town to AMD because the DoD would not buy the chips otherwise.
3. Non-competes
4. The weather