Silicon Valley’s vanishing middle class

Steve Jobs homeWhen you read the biographies of Steve Jobs, Steve Wozniak and other early Silicon Valley entrepreneurs, one thing to note is their middle-class origins. Jobs’ father, Paul, was a mechanic and carpenter. Wozniak’s father was an engineer. They went to the local public schools, back in the Golden Age of California education, the 1960s and 1970s.

Jobs’ modest family home, where he and Woz started Apple in the garage, now is a kind of shrine to techies and in 2013 was designated a historical site by the Los Altos Historical Commission. (Picture above.)

California, especially Silicon Valley, has become so expensive the middle class is being squeezed out. KQED reported:

The nonprofit Joint Venture Silicon Valley has tracked local economic trends for the last 20 years. This year’s Silicon Valley Index reported the income gap is wider than ever, and wider in Silicon Valley than elsewhere in the San Francisco Bay Area or California.

Joint Venture divides the workforce into three different “tiers.” For high-skilled, high-wage jobs, Tier 1 in Silicon Valley, the median wage is $119,000 a year. For low-skilled, low-wage jobs, or Tier 3, the median is $27,000.

“Thirty percent of our population is living below the self-sufficiency standard,” says Joint Venture Vice President Rachel Massaro. “That means they can’t survive without public or informal private assistance.”

The main problem is that state policies severely restrict building adequate new housing. It’s simple supply and demand: Demand rises faster than supply, so prices go up.

In particular, the California Coastal Commission now limits construction in coastal areas, which has a ripple effect inland for at least 50 miles, raising the price of everything.

Then there are the LAFCOs: local area formation commissions, that also limit construction.

3 comments

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  1. Queeg
    Queeg 24 February, 2015, 20:17

    Comrades

    Knew a couple who lived in Communist Hungary. They were 21 years on a waiting list for a 450 sq. Ft. condo.

    No one in their parents’ apartment house had a refrigerator…..

    Reply this comment
  2. desmond
    desmond 25 February, 2015, 19:48

    Ted Queeg Ahaul,
    Ha ha.

    Reply this comment

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John Seiler

John Seiler

John Seiler has been writing about California for 25 years. That includes 22 years as an editorial writer for the Orange County Register and two years for CalWatchDog.com, where he is managing editor. He attended the University of Michigan and graduated from Hillsdale College. He was a Russian linguist in U.S. Army military intelligence from 1978 to 1982. He was an editor and writer for Phillips Publishing Company from 1983 to 1986. He has written for Policy Review, Chronicles, LewRockwell.com, Flash Report and numerous other publications. His email: [email protected]

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