Saturday, August 3, 2013

The two Silicon Valleys: a rant about living in San Jose.

We spent much of yesterday discussing things local and housing related in the area which inevitably led to a discussion about how little the money gets spread around in this allegedly affluent area.  The big rental property management companies around here might as well just be printing money as rents have jumped almost 100% in the last 10 years.  New apartments are going up all over the area and developers are greedily rubbing their hands together with visions of the insane rents that I'm sure they expect to keep going up and up. This is in large part being powered by huge numbers of tech hires, many (most?) of whom are moving in from other states and other countries.  At these jobs, interns earn nearly 6 figures.  And by the way, the new development is only happening because most of the affordable housing requirements have expired, so don't expect any breaks on the [artificially inflated] market rents at these new properties.

See the Business Journal slide show of new overpriced cookie-cutter developments coming soon to San Jose.

Meanwhile, those who have service jobs in the valley are unlikely to have seen any raises in the last 4 - 5 years and have probably lost benefits while their employers cried "We can't--the economy!" The pay gap is enormous. To be clear, "service" now encompasses many jobs in office buildings that were previously considered white collar.  People I know who work in banks, as admins in traditional business sectors, property management, etc. are lucky to make even $20/hour, which is less than half of what the average non-productive employee is making in certain fields.  Employers whine that they are doing more than they should have to do because people in the middle part of the country would love to get paid $15/hour.  But how can you afford $2000/month for a 1 bedroom apartment on that wage?  You can't.  If you aren't making close to 6 figures, you probably have no business even considering paying that level of rent.

I'm really disgusted and depressed.  The number of homeless on the streets is higher than I can ever remember before.  It seems inevitable that without any form of rent control and with really weak/useless low income housing many people will be forced out of the area. That will make things even harder because it's hard to find a job that doesn't require you to have a car, but it is nearly impossible to pay for a car on a retail salary.  Good luck getting around on our ridiculous public transportation.  I hope you have plenty of time and nothing else you need to accomplish during your day than work and get to/from work.

Meanwhile, those who work at the highest paid jobs have retained full benefits paid by their employers and continue to have more and more of their living expenses taken care of by their employers.  Too cool to live in the valley?  That's OK because a bus will pick you up in SF and drive you to work every day so you don't have to pay the $20 roundtrip fare on Caltrain.  Breakfast? Lunch? Dinner when you're working late?  All covered for free at the employee cantina. Gym? Dry cleaning?  Social life? They have you covered.  Meanwhile, if you work at Starbucks you will have to pay for a car on your $12/hour because the stores open before public transport starts running and your lunch is on you during your timed 30 minute lunch break.  Yes, they have health insurance, but expect it to take a bite out of your take home pay and if you actually want to use it, you will also have to pay a deductible and a large co-pay. 

At least you can take solace in the fact that these highly paid workers are doing the really important work in society, like streaming movies and selling your personal data gathered from your Facebook page.  The people who feed us, teach us, and fix our leaky faucets in our apartments aren't doing anything we really need.