by Peter Franklin
Thursday, 26
November 2020

Will Covid kill Silicon Valley? 

by Peter Franklin
A tech worker, speeding away from California. Credit: Ole Spata/DPA/PA Images

During the Great Depression of the 1930s, poverty-stricken families from the American heartlands packed up their bags and migrated to California. 90 years later there are signs of a reverse migration. Only this time, it’s not farm workers, but tech workers. According to Katherine Bindley in the Wall Street Journal, smaller tech companies in places like Bloomington, Minnesota and Tucson, Arizona are getting job applications from the people based in the big coastal tech clusters.

As some of the employers interviewed in the article make clear, this is happening for the first time. If that’s indicative of a wider trend, then we’re looking at a significant disruption:

“For years, high-talent tech workers have been drawn to Silicon Valley, willing to put up with exorbitant housing prices and long commutes to benefit from the skill and experience of their colleagues, and the largess of employers and investors. The result, a culture of entrepreneurialism and inspiration, has been hard to match elsewhere.”
- Katherine Bindley, The Wall Street Journal

Birds of a feather flock together, and businesses are no exception. It helps to have your clients and suppliers within reach. It even makes sense to co-locate with your competitors — because you can keep an eye on them and there’s a bigger pool of local talent to recruit from. Arguably, Silicon Valley — home to Apple, Google and a long list of other hi-tech companies — is the most important business cluster on the planet.

That’s quite the irony, because this is the industry that was supposed to make geography irrelevant. Instead, the more we went online, the greater the concentration of the most highly qualified workers in a select number of superstar cities.

But is this paradox of the digital age unravelling? With the pandemic forcing millions of us to commute to our kitchen tables, we see tech companies in the forefront of this change. For instance, Google — once famous for developing the workplace into a home-from-home — told its workers they could work from their actual homes until the summer of 2021. Furthermore it’s the tech sector’s software and hardware that’s allowing us to work remotely whether we work in tech or not.

Of course, there’s a big difference between merely not commuting from a nearby suburb and moving hundreds of miles away. The latter looks a lot more permanent than the former.

One of the biggest worries about working remotely is that’s it bad for creativity. Without the interactions enabled by physical proximity it is feared that workforces won’t generate the ideas on which innovation depends.

But perhaps Silicon Valley has become too close. These days, it’s less of a cluster and more of a blob. Genuinely creative thinking is being smothered by a conformist corporate culture. Certainly, the last ten years of tech has been noticeably less exciting than previous decades. We’re still getting the iterative improvements, but where are the world-changing new products? I’m afraid Alexa can’t answer that one.

Therefore, the de-clustering of Silicon Valley might be just what it needs. Once the geeks are out of each other pockets, they might just feel free to think disruptively again.

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