Can Silicon Valley's San Jose find its way?

San Jose suffered a massive calamity just a few years ago that cost it 225,000 jobs - nearly one quarter of its entire population - the worst job loss anywhere in the US since the Great Depression.The dotcom dotbomb from 2001 to 2003 was a period that San Jose wants to avoid this time around.

San Jose suffered a massive calamity just a few years ago that cost it 225,000 jobs - nearly one quarter of its entire population - the worst job loss anywhere in the US since the Great Depression.

The dotcom dotbomb from 2001 to 2003 was a period that San Jose wants to avoid this time around. I spoke with Paul Krutko, San Jose's Chief Development officer.

Any sign of a Silicon Valley recession?

"San Jose represents about 60 per cent of all Silicon Valley jobs so we see trends first. So far, we don't seem to be impacted by the recession, our unemployment rate is low, 5.2 per cent, a full point below the California average."

Keeping large San Jose companies such as Adobe and Cisco happy is a priority for San Jose. These type of global companies offer economic cycles that transcend local conditions. San Jose has instituted a fast track permit process that grants approval in hours rather than months.

This program has helped speed approval of about 9.1m square feet of office space, representing 15 thousand jobs, and equivalent to twenty seven 17 storey buildings (San Jose's height limit).

Similar speedy permit pre-approval has been applied to production equipment from which the city earns a property tax.

Shortening the commute . . .

With higher gas prices local businesses have sought to bring down the long commutes for their staff. San Jose has now changed some of the zoning restrictions for property that is close to the light rail corridor.

Businesses were only allowed to build on 35 per cent of their acreage."We now allow businesses to build as much as 135 per cent of their acreage, so we have a taller and denser footprint along the light rail corridor. We also have approved 32,000 residential units so that people can live closer to work," said Mr Krutko. About 3 million square feet of 29m square feet of new office space has been built, and 8 thousand residentail units have been built so far.

Green is an important focus and the city has an ambitious plan to be off the grid by 2025. Green and clean energy incubators are a way that San Jose seeks to diversify its economy. "San Jose has traditionally more focused on hardware, now we are building clean and green tech busineses and also in the biosciences to try and increase our economic diversity."

San Jose was recently chosen as the site for the largest solar testing and certification facility by Underwriters Laboratories, which should help attract more solar businesses to the area.

Ethnic diversity . . .

San Jose is the most ethnically diverse metropolitan area in the US if you count the Asian and Hispanic populations - more than Los Angelese or Miami. About 39 per cent of its population is foreign born. It has the largest Vietnamese population in the US and this also creates large economies that service those populations. San Jose says that there are 50 languages spoken in the city [that might help establish call centers serving multiple markets].

San Jose's firms such as Cisco are also opening operations elsewhere and abroad but this doesn't trouble Mr Krutko. "I was asked if I was bothered by Cisco opening up a large operation in India. I said I would be bothered if they weren't. We want healthy companies that can compete globally."

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