The Bay Area is enjoying the reverse brain drain as it manages to hold on to its talents by offering attractive packages, wages, and laying down the groundwork for families to take root.
“Before, San Diego was like a pit stop for tech workers to hone their skills. But you feel like they were just waiting for their opportunity to move to bigger areas like Silicon Valley or New York,” entrepreneur Ryan Mack said. “Now, it managed to stem that brain drain, which is both a good thing and bad thing.”
He said the reverse brain drain is both an opportunity and a risk for San Diego. If it’s not careful, it will commit the same mistakes in Silicon Valley where the housing crisis affected all the other economic activities.
“Because half of the money went to the rental, there’s not much left to do anything else,” he added. “Consumption goes down and so will the savings for that much-needed vacation or that second car, or buying some assets. All these would have spurred the local economy.”
With the exodus of talent from Silicon Company, tech companies and retailers have no choice but to follow them. That would become a problem for Apple, for instance, which located its main headquarters in Cupertino. The result was the property prices zoomed up to over $2 million in 2018 from the $1.7 million in 2015, and that’s not even factoring in the property taxes.
“San Diego is the logical next hub,” Mack added. “The Bay Area already processed the most number of genomic patents in the U.S. and these companies are contributing billions to the local economy.”
Aside from the lower cost of living in the Bay Area, it also has a more laid-back style compared to San Francisco, which is perfect to raise a family. Rental is cheaper compared to San Francisco and so does the consumption cost.
However, as more and more people will flock to San Diego, rental prices and property costs are bound to also shoot up as what’s happening now. Smaller pop-and-mom stores will be swallowed by huge retailers, which will have to cater to the new market.
“Pretty soon, we have a new Silicon Valley in our hands if we are not careful,” Mack said. “This is why we should optimize this reverse brain drain and make sure the Bay Area is prepared to absorb all that impact. That’s the only way to truly optimize all that talent to expand the local economy.”
Mack clarified that San Diego won’t be a poor replica of Silicon Valley because the lifestyle and culture are very different. The Bay Area can have its own identity as a knowledge-based economy.
“The good thing is that we have a perfect example in Silicon Valley about what not to do. We already know the pitfalls and the best practices,” he added. “We know what they did wrong, and what steps to take to avoid making those same mistakes. We can do that here.”