The pivotal role The City’s technology industry has played in turning around the local economy is highlighted in Mayor Ed Lee’s $7.9 billion San Francisco budget proposal unveiled Friday.
The recent economic activity, largely driven by the tech sector, has translated into pre-recession tax revenue levels for The City, allowing the mayor to stave off cuts to city services, increase spending and hire hundreds more city workers.
The budget document notes that when Lee came into office in January 2011, unemployment was 9.5 percent, but that had decreased to 5.4 percent at the time of the budget submission. For 12 months that concluded September 2012, 27,000 jobs were added to the local economy, the budget said.
“San Francisco tech industry growth in social media, gaming, mobile, cloud and software is driving demand for commercial office space and creating more jobs in San Francisco,” the budget said. For example, there are 11 tech companies housed in 950,000 square feet of office space along the central Market Street corridor, the budget said.
The budget document said technology companies last year leased 54.6 percent of all of San Francisco’s leasable office space, “the equivalent to more than 10 Transamerica Pyramids.”
With Silicon Valley angel investor Ron Conway helping to craft policies to favor the tech industry, such as the voter-approved overhaul of the way The City taxes businesses, and high-profile companies including Twitter and Zynga calling San Francisco home, it’s not surprising the budget said the technology industry was the fastest growing sector in The City, followed by construction. There are 35 construction cranes dotting the skyline, including the one for the 96-unit housing development at 1800 Van Ness by Build Group Inc.
The proposal even listed by name a number of the tech companies that expanded in San Francisco during the past two years: Salesforce.com, Square, Dolby, Twitter, Zynga, Riverbed, Airbnb, LinkedIn, Yammer, Lithium, Meraki, Splunk, Github, Tagged, Zoosk, Yelp, One Kings Lane, Macys.com, Pac-12 Enterprises, Mozilla, Zendesk and Kabam.
“Today there are more than 1,800 technology companies in San Francisco,” the budget proposal said. Another growth indicator is that tech companies have increased employment by 50 percent since January 2011, “bringing millions of dollars in revenue to our City and making San Francisco the Innovation Capital of the World.”
“The current wave of investment and growth in the tech industry is centered on firms more attracted to dynamic and creative urban areas than has been the case in the past,” the budget document said.