The San Francisco Bay Area is on the brink of an exodus as a low supply of homes and high demand drive housing prices – and the cost of living – to new heights.
But where are they going?
One of the trends the company is watching: where people leaving San Francisco are headed.
LinkedIn crunched its data to identify the US cities where the most LinkedIn members moved to from the San Francisco Bay Area in the past year. These are the top 10 destinations.
10. Stockton, California
Located in California’s Central Valley, Stockton in 2013 became the most populous US city to declare bankruptcy.
Now the city’s 27-year-old mayor is leading a basic-income trial that will give some residents $US500 in cash each month with no strings attached. That program was initially funded with a $US1 million grant from a group co-chaired by the Facebook cofounder Chris Hughes.
The tech-fuelled riches of Silicon Valley could help turn around this California city’s fortune.
9. Salt Lake City, Utah
Dubbed the Silicon Slopes, the area from Salt Lake City to Provo is filled with top tech companies, including Adobe, EA, Overstock.com, and the cloud software startup Domo.
Tech workers who flock to Salt Lake City for its lower taxes, flexible regulatory environment, and natural amenities may find they can actually afford a home near the office.
The National Association of Realtors reported that the salary needed to buy a home in Salt Lake City was $US59,521 in the last quarter of 2017. In San Francisco, it’s at least $US173,783.
Tech workers are finding paradise on the Hawaiian Islands. (LinkedIn was not more specific about which islands.)
The availability of wireless internet and smartphones has made it easy for people to work remotely, even where they’re surrounded on all sides by the Pacific Ocean.
A recent report found that the tech sector in Hawaii remains small, and the state ranks 44th in net tech employment. Hawaii employed about 31,000 tech workers last year, making up just 4% of its total workforce.
Guy Berger, an economist who works at LinkedIn, said retirees and people working outside the tech industry most likely accounted for some of the migration from the San Francisco Bay Area.
7. Phoenix, Arizona
Just a two-hour flight from San Francisco, Phoenix draws tech workers with its lively business climate, access to top talent out of Arizona State University, and proximity to Silicon Valley. The number of tech companies based in the city quadrupled from 2012 to 2017.
With a price tag of $US250,000, the median-priced home costs a fraction of a typical house in San Francisco.
6. Las Vegas, Nevada
The Las Vegas startup scene has blossomed with the increasing local presence of large, national companies. Tony Hsieh, the CEO of the online shoe retailer Zappos, an Amazon subsidiary, has pumped at least $US350 million of his own money into revitalizing downtown Las Vegas.
While cities like Los Angeles and Seattle draw tech workers looking to move into slightly more affordable tech hubs, Berger says Las Vegas attracts people making a “pure cost-of-living play.” The median price of a home there is $US259,000, according to Redfin.
5. Austin, Texas
Tim Ferriss, the author of “The 4-Hour Workweek,” moved to Austin last year after spending decades as an entrepreneur and investor in San Francisco.
Ferriss recently said that in Austin, he found a “very young community and a medley of feature film, music – certainly tech if I need to scratch that itch – but there were more perspectives that I could borrow from and learn from than I found readily available in my circles in Silicon Valley.”
4. Denver, Colorado
In many ways, Denver is like San Francisco, but better.
The Mile-High City – named for its elevation and not its legendary marijuana festivals – offers a bustling downtown, more than 5,000 acres of parks, and a new light-rail system that puts California’s Bay Area Rapid Transit to shame. Eighty-five miles of paved bike trails connect the entire metro area.
3. Sacramento, California
Sacramento, California’s capital, is becoming a natural destination for tech workers seeking refuge from San Francisco’s housing market.
Because Sacramento is about a two-hour drive from Silicon Valley, some workers are able to commute to their high-paying jobs there.
Cities like Sacramento and Stockton weren’t always considered part of the Bay Area commuter range, according to Berger. The housing-affordability crisis changed that.
“At this point, people are saying, ‘I’m going to keep working in the Bay Area – maybe work from home a few days a week, work remotely, or endure brutal commutes,'” Berger said.
2. Portland, Oregon
Known locally as the Silicon Forest, Portland has a tech sector that was once growing faster than its counterpart in Silicon Valley.
The city and nearly two dozen of its largest tech companies created a pledge called TechTown that aims to cultivate workplace diversity to grow the industry.
1. Seattle, Washington
“If you think of all these cities and just think, literally, ‘What is the closest substitute to the Bay Area at a slightly lower cost?’ Seattle tops the list,” Berger told Business Insider.
Seattle, a slightly smaller and less expensive city than San Francisco, is home to Microsoft and Amazon, both of which attract top talent to the region. It’s also the birthplace of Starbucks and has a thriving indie art and music scene.
Deciding between San Francisco and Seattle? Check out Business Insider’s guide on how the two tech hubs compare.
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