Impressive growth in the non-tech job sector in San Francisco is great news! In an article on bloomberg.com, Aki Ito reports:
Positions in everything from retail to construction to hospitality now comprise about 75 percent of the city’s job growth, helping the Northern Californian hub add jobs at among the fastest rates in the nation and reduce its unemployment rate to 6.5 percent.
There was concern that the large number of high-tech jobs in San Francisco and the Bay Area wouldn’t do much for workers in other areas of the workforce. In fact, it would only help highly skilled people who could work in the tech industries. Do these recent numbers put that worry to rest? Some would say that the recent growth in the high-tech sector has sparked an increase jobs in the non-tech sector. UC Berkeley Economics Professor Enrico Moretti, author “The New Geography of Jobs“, is well known for his research and writings about the multiplier effect of innovation jobs (the majority of which are in high-tech). Moretti’s research shows that for each new high-tech job in a city, 5 additional jobs are created outside high-tech in that city – this is more jobs than any other sector creates outside of its own sphere.
How does this happen and why to such a great degree ? Moretti theorizes that high-tech workers, with higher disposable incomes, consume more local services which leads to an increased need for jobs in local businesses. The high-tech companies themselves use a large number of local resources to run – food suppliers, lawyers, health care providers, etc. Additionally, having several tech companies located near each other multiplies the impact of this kind of multiplier effect.
While there may not be one type of job or one company which is responsible for sparking San Francisco’s non-tech job growth, real recovery is happening.