High-Tech Generating High-Returns to San Francisco

The San Francisco Chamber of Commerce has long advocated for San Franciscans to embrace the technology industry – and the recent news that Google is substantially expanding its existing presence downtown is a clear signal that the world’s largest search engine is most certainly embracing our city. And, thanks to our highly creative, educated talent pool, they’re not alone.

With the reported $65 million transaction, which includes the purchase of the 188 The Embarcadero building and the leasing of approximately 250,000 square feet at the Spear Tower in the One Market Plaza complex, Google joins an impressive roster of Silicon Valley-based high-tech companies that recognize the importance of having a significant presence in San Francisco. Among the lengthy list of other South Bay high-tech companies that have either expanded to San Francisco or increased their existing city presence are Adobe, Cisco, Intuit, LinkedIn, Oracle, and Yahoo!.

With these welcomed additions and enhancements to the San Francisco business community, complemented with native SF-based high-tech firms such as Autodesk, Salesforce and Twitter – and an array of start-ups – among others, it comes as no surprise that a recent Bloomberg report characterized San Francisco as the “center of technology in America.”

That has a nice ring to it. But, aside from the prestige of that claim, the tremendous positive impact that the tech industry has on our community and economy should also be part of this story.

Last summer, we noted that San Francisco is home to more than 1,800 tech companies that employ 42,000 people and create 7.5 percent of the city’s jobs. And, these numbers have undoubtedly increased since that time (expect updated statistics as part of the San Francisco Chamber’s upcoming annual ForecastSF event).

What’s more, high-tech jobs have a significant multiplier effect – creating five additional non-tech jobs for every tech industry job created, which results in thousands of more jobs in other sectors in San Francisco and across the Bay Area. Over the last three years, virtually every job category in the city has experienced job growth, whether it is in the visitor industry, professional services, medical fields or manufacturing.

According to University of California, Berkeley Professor and author of “The New Geography of Jobs,” Enrico Moretti, “The most important effect of high tech companies on the San Francisco labor market is for workers employed outside the high tech sector.”

In addition to these direct and indirect positive impacts on San Francisco job creation, tech companies are stepping up their local philanthropic giving. A couple recent examples include Google’s donations to local charities including a $6.8 million grant that will provide free transit passes for low-income youth in the city, and the $100 million gift from Salesforce.com founder Marc Benioff and his wife Lynne to UCSF’s Benioff Children’s Hospital and Children’s Hospital Oakland.

The Chamber commends Mayor Ed Lee for his leadership and efforts to create a strong climate for investment in the city. The Mayor has cautioned us not to get complacent and rest on our success. We congratulate Google and other high-tech businesses for recognizing San Francisco’s unrivaled talent, investing in the city and meeting Mayor Lee’s challenge to “double down” on San Francisco – a bet certain to reap high returns.