Report: Silicon Valley leading US out of recession
SAN JOSE, Calif. (KGO) -- Silicon Valley is leading the country out of recession according to the "2012 Silicon Valley Index" released Tuesday by Joint Venture Silicon Valley and the Silicon Valley Community Foundation.
A total of 42,000 jobs were added last year, an increase of 3.8 percent over the previous year. However, the Valley still has not recovered all of the jobs lost since the recession began in 2008. Newly-added jobs cut across a wide range of categories except for manufacturing. Key sectors creating jobs included cloud computing, mobile devices, internet companies, and social/new media. Silicon Valley now supports an estimated workforce of 1.2 million people. That compares to 1.3 million prior to the recession.
However, the index also pointed out that small businesses are "clearly not out of the rough," said Russell Hancock, CEO of Joint Venture. Also, there is clearly an ongoing struggle as the public sector's financial woes and median household incomes falling are holding back a broader recovery. For the second year in a row, median income has dropped. It fell 3 percent to $86,000 in the past year.
What Hancock sees happening is that technology, the foundation of the Valley's economy, no longer raises the tide for all boats. He says while 43 percent of the region's households make $100,000 or more, a segment that is growing, the percentage of households making between $40,000 and $100,000 is shrinking. That, he suggests, is creating two Valleys.
There are also bright spots in the Valley economy. Venture capital funding increased 17 percent in the past year, twice what it was a year earlier. Also, there were 12 initial public offerings in the past year versus 11 in 2010 and only one in 2009.
Dr. Emmett Carson, CEO of the Silicon Valley Community Foundation, also said it's time to revisit Proposition 13, the 1978 initiative that changed how property taxes are assessed.
ABC7's David Louie will have more details and analysis of the "2012 Silicon Valley Index" later today on ABC7 News at 4 p.m. and 6 p.m.
silicon valley, economy, recession, jobs, unemployment, business, david louie
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