Class XXI Forum:
A New Recipe for Regional Job Growth - A Conversation for Change
On March 12, 2010, ALF Class XXI presented a forum: A New Recipe for Regional Job Growth - A Conversation for Change. More than 100 Silicon Valley leaders were challenged to take a frank look at the future of job growth in our region.
The forum opened with a video greeting from John Chambers, CEO of Cisco Systems (see photo below).
After hearing from conversation starters (pictured below, l-r) James MacGregor, Publisher, Silicon Valley/San Jose Business Journal; Cindy Chavez, Class XII, Executive Officer, South Bay Labor Council; Teresa Briggs, Class XX, Managing Partner, Deloitte LLP & Phil Mahoney, Executive Vice President, Cornish & Carey, a broad cross section of participants discussed possibilities for the future and opportunities for action.
Class XXI is collecting names and contact information from anyone interested in
continuing this conversation. If you were unable to attend the Forum, but would
like to receive information about future opportunities for involvement, contact
Andrea Faiss in the ALF office by emailing afaiss@alfsv.org
or calling 408-554-2000.
Resources:
2010 Joint Venture: Silicon Valley Network Index
Santa Clara University's Leavey School of Business California Program for Entrepreneurship (CAPE)
Media:
Why the President's Next Big Thing Should Be Jobs by Robert Reich (Huffington Post 3.26.10)
Key takeaways:
- People who have lost jobs want solutions now.
- What is the impact of the middle class disappearing?
- Regionalism is important, and government can’t do it alone. We need to get everyone to the table.
- K-12 education is important, since it is the pipeline of the future workforce.
- Cost of housing costs is a major factor.
- Tax credits must be considered.
- Pensions, benefits & healthcare are huge, unsolved issues.
- Cost of doing business in Silicon Valley makes some businesses feel trapped.
- Small business was left out of this conversation.
- Need to figure out what will motivate the different sectors. They need to see what is in it for them.
Small Group Dialogue Highlights:
- America itself has an identity crisis. There needs to be re-set.
- We must solve this as a region. The regional voice is critical.
- The region’s problems seem so big that nothing gets started.
- On a positive note, Silicon Valley is still seen as the place to go for innovation.
- What used to be doesn’t apply. Old paradigms do not work. We need a new model. So what’s new and what’s possible?
- We need a new economic model to fill the gap – companies need incentives.
- Local banks and credit unions need to loan money to small businesses.
- We need training programs for knowledge workers to help them transition between industries, not just programs for the blue collar workforce.
- How do we incentivize businesses to hire people?
- The region needs a flexible workforce.
- Need to invest in people, communities and schools, not just business.
- Should we be focusing on big companies to come in and provide jobs, or
small entrepreneurial firms (which are what historically has provided
the engine)?
- Education is important. There is a population and demographic in Silicon Valley that is not going to college. We aren’t graduating people who can work in high tech. This can make a huge difference in Silicon Valley.
- If we do nothing we run the risk of bifurcating the community even more: the highly educated, highly paid, and the lower educated and not well paid. For example, at Cisco, 95% of their employees are college educated. Everything that does not require a college education is outsourced.
- If we don’t have possibilities for the lower tier, what does that mean for a community?
- High school students want to know how quickly they can get a job.
- Looking into the future, education is a risk to the California economy.
- Mountain View is an example. 50% of students are receiving school subsidies, as the economy is down more than anticipated.
- There are whole groups of people for whom the whole job universe is in
the $10 - $15 range. They don’t think beyond those jobs. The goal has
always been to raise the amount of pay, to improve people’s quality of
life. Do we need to think differently about this?
- There will be jobs that pay $10 an hour. But, people can’t live on that. How are we going to fill those jobs? Immigrants have been filling those jobs, but that seems unjust.
- There are many unemployed people in Silicon Valley. What can be done to get people working? Invest in infrastructure, but this requires hones conversations as the money will need to come from taxes.
- The job situation is still deteriorating.
- This is a jobless recovery. There will be a new norm for unemployment – probably 7%.
- Low wage jobs used to be a first step in working oneself up. Now that is not the case.
- Do you bring the worker up to a higher wage job or do you bring the wages up? What is a minimum wage job?
- Young people are moving to cities and states with lower costs of living.
- The cost of housing drives the cost of living in this area, and that drives the cost of doing business through higher salaries. This is hard to change.
- Even when there are jobs, people don’t want to be in this region for other reasons: can’t buy a house, schools are terrible, commuting is expensive, etc.
- There are industries here besides tech, like medicine, tourism, etc.
- People do not need to live in Silicon Valley to work in Silicon Valley. In a lot of industries they can live where it is cheaper and work virtually.
- When Cisco says that India is the center of its business, then it is saying more than we are hearing.The emphasis has been on corporations. But, what about small business and nonprofit?
- We need places people can afford to live. But, what does that mean? We can never go back to the way it was in Silicon Valley. So what is the new definition?
- Salaries are higher in this region. It’s not just taxes and the cost of health care that are driving the cost of employing people in this area.
- There’s a high cost to this region. The future is in creating a flexible environment, as immigration goes both ways.
- Government cannot create jobs. Government is a manager.
- The public decision-making process takes too long. Government needs to be more flexible.
- We need better participation in the electoral process.
- Council members are elected by people, not businesses.
- There’s constituent and voter fatigue.
- Politicians are always concerned with the next election.
- Businesspeople need to forge relationships with government.
- Sacramento and the California legislature is the elephant in the room. They’re taking money from cities.
- Local government strategies don’t always work and citizens shouldn’t wait for government to solve the problems.
- Sometimes working at the grassroots level is more effective. Some disagree.
- We need a regional steering committee to drive economic development. Right now cities are competing against each other.
- We need a regional economic development person, or a regional development board.
- What happens after the region comes together? What are the next steps?
- Where are the solid examples of public/private collaboration?
- There was a San Jose/Oakland/San Francisco green energy initiative that started with the mayors working together to reduce the region’s carbon footprint. This might be a model.
- Regions like Denver and Austin have centers. Silicon Valley is different, with smaller cities like Palo Alto and Mountain View in addition to San Jose.
- Workforce agencies have a role. They can fund things from the perspective of the public good, and can collaborate with the private sector.
- There should be programs to help small businesses get green-certified, since many don’t have the staff to do it on their own.
- Businesses and individuals should source locally whenever possible. The higher costs are sometimes offset by benefits like being able to work face-to-face.
- Business incubation money is hard to come by (without the venture interest for return).
- The Economist had a profile of the efforts in Texas versus California.
