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San Francisco is scaring away the tech crowd

After an afternoon lazing in San Francisco’s Dolores Park last year, as two friends and I walked through the bustling Latin district known as the Mission, I noticed a man on the opposite pavement growing agitated.

He was shouting, growling, waving his arms. Shortly after, I heard the bang. My friends and I dropped to the ground, crouching behind a large white truck for cover. Brandishing a small handgun, the man fired straight up into the air. Then he disappeared into the night.

More unsettling than my brush with a live shooter was the fact that the incident barely registered — within minutes, everyone was back on their feet, and normality resumed.

It seems everyone living in San Francisco has a similar story to tell right now. During the pandemic, pre-existing wealth disparities have been exacerbated. In 2020, drug overdoses outnumbered Covid deaths by more than double. Homeless encampments line up alongside rows of the city’s famous colourful town houses.

Both organised and opportunistic crime is rampant, particularly property and auto theft. A colleague who came to film in the city said her team had to hire security guards after a spate of robberies targeted camera crews at gunpoint. Last month, footage emerged of residents leaving car doors open so burglars would not smash their windows. “The real epidemic is poverty,” a friend offers, in one of many conversations about the state of the city.

For some privileged inhabitants, unable to cope with the desperation and lawlessness, the answer may have been to flee. This month, Silicon Valley executives began sharing statistics showing that the proportion of staff they hire in the city and the surrounding Bay Area has shrunk dramatically in recent years. Coinbase chief executive Brian Armstrong notes that in the first quarter of 2019, 30 per cent of the company’s hiring was outside the Bay Area; in the last quarter of 2021, it was 89 per cent.

The change was attributed to the tech world becoming more “global” and decentralised — drawing from a wider pool of applicants. But I wonder if it can also be explained by an exodus of the Silicon Valley crowd to other city hubs (with lower taxes).

Start-up founders, computer engineers and venture capitalists have been abandoning the city of peace, love and progressive politics — many leaving behind a diatribe on why they felt inclined to get out.

“In 2000 or 2010, it made sense to build in San Francisco. That’s where all the talent was, but not any more,” Joe Lonsdale, venture capitalist and Palantir co-founder wrote on leaving the city in November 2020.

LinkedIn data suggests many have landed in Austin, while Manhattan’s Silicon Alley is ballooning. The tech-friendly mayor of Miami is trying to woo displaced talent. Last week, Airbnb boss Brian Chesky tweeted he was ditching San Francisco to start Airbnb-hopping: “in a different town or city every couple [of] weeks”.

In its 1990s and early 2000s heyday, tech workers with their meetups, uniform (the Patagonia jacket) and money seemed to own San Francisco. But steeply-rising housing costs since 2012, a lacklustre nightlife and yearly bouts of polluting wildfire smoke are harder to overlook when safety also becomes a luxury.

Some blame the ultra-permissive policies of district attorney Chesa Boudin, who came to power in 2020 on pledges to reduce prison sentences and decriminalise poverty. His perceived failure to guarantee public safety is now being seized upon by Republicans, and he faces a recall in June. The democratic mayor, London Breed, has switched from preaching “compassion” to “tough love”; from defunding to refunding the police.

What is missing is a thoughtful attempt to tackle the root issues of the “poverty epidemic”. Margot Kushal, who leads the University of California San Francisco’s Center for Vulnerable Populations, argues that the first step is to tackle a crippling need for affordable housing. “Low-income housing has just disappeared from our landscape. Every day, we see people spilling into homelessness,” she says. “It is a huge policy crisis at every level of government.” 

Resilience in times of crisis is vital. But if the city wants its tech crown back, unlike the evening crowds in the Mission, it cannot afford to just continue as normal.

hannah.murphy@ft.com

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