If the Bay Area were a nation, its economy would rank as the 19th largest in the world. With a Gross Domestic Product (GDP) of $748 billion, this technology-fueled region comprised of nine counties has surpassed that of Switzerland (#20 with a GDP of $686 billion) and is quickly gaining on the Netherlands (ranked at #18 with a $822 billion GDP) as well as Turkey, and Indonesia. In 2014, the Bay Area ranked 21st on the list, according to the Bay Area Council’s Economic Institute, the organization that is gathering and crunching these financial statistics.
According to its website, “the Economic Institute is the leading think tank focused on the most critical economic and policy issues facing the nine-county Bay Area region. Guided by a board of trustees and through its economic and policy research and numerous partnerships, the Institute addresses major factors impacting the competitiveness, economic development and quality of life of the region and the state, including infrastructure, globalization, science and technology, and health policy.”
Over the past three years, the Bay Area’s annual growth rate has clocked in at 4.3%, almost twice that of the economy growth of the United States as a whole. California is the 5th largest world economy, up from #10 in 2012.
“The Bay Area has emerged from the Great Recession to enter a new period of immense growth and innovation,” the Economic Institute said in the 10th economic synopsis published by the organization.
Powered by high tech companies such as Apple, Facebook, Adobe, and Mountain View’s Google as well as a multitude of start-ups, the Bay Area is fueled by the affluence of a burgeoning techy workforce. There has been a surge in tech and health care careers, which is contributing to the Bay Area’s 2.3 percent increase in jobs. Silicon Valley is the primary source driving Bay Area growth, evidenced by the 3.2 percent of jobs created in Santa Clara County during the twelve months ending in May 2018.
Jeff Bellisario, Economic Institute vice president and co-author of the most recent study states, “The economy in the Bay Area is growing at about 4 percent a year and about twice as fast as the U.S. economy…and is very much driven by Silicon Valley.”
California’s job market is increasing at 1.8 percent a year while the United States’ job market is expanding at 1.6 percent a year, in sharp contrast to the 3.2 percent growth coming out of the Silicon Valley.
From July 2016 through July 2017, 45,670 people moved out of the Bay Area but offsetting this exodus was an influx of 58,156 people from abroad who moved to the region, many of whom were recruited for their professional skillset.
Critical to the Bay Area’s economic future includes confronting the challenges of transit and housing. Despite the shortage of housing that is causing some to leave the area, there have been few if any indicators that this economic upswing will take a turn in the near future.
According to the Council’s report, “The Bay Area economy is still currently on the upswing, rather than having reached a peak or started a decline.”