Silicon Valley’s tech economy is hotter than ever, but many citizens are being left behind.
That’s one key message from this year’s Silicon Valley Index, a comprehensive annual regional report card from community think tank Joint Venture Silicon Valley. The group presented the report at its annual State of the Valley event on Friday at San Jose State University to a crowd of 500.
The report shows the local economy grew by 38% in the last decade from 2015 to 2025, faster than the rest of California at 19% and the rest of the US at 22%. Venture capitalists poured $92 billion into Bay Area companies last year, on par with a record $100 billion in 2021. Inventors in Silicon Valley filed 23,000 patents – below the all-time high in 2024.
“Silicon Valley’s innovation engine is as hot as it’s ever been,” Russell Hancock, president of Joint Venture, said in a call with reporters on Wednesday. “The most advanced jobs yet to be found here, they are making the electrons play.”
At the same time, income inequality and stratospheric housing prices make life difficult for residents who work outside of tech.
The top 10% of Silicon Valley families own 75% of the region’s wealth, the report shows, while in Europe the top 10% control only 25%. The bottom half of families in Silicon Valley own only 1% of the wealth. About 28 percent of local families need outside help – from family members, grants or government programs – to survive.
“We see firsthand that increasing income inequality affects economic mobility and weakens our community,” Don Taylor, CEO of Catholic Charities of Santa Clara County, told the San José Spotlight. “Many families are working full-time – often multi-tasking – but are still unable to support themselves because wages have not kept up with the high cost of living.
Jim Beall, a former state representative and current Valley Water board member, attended Friday’s Joint Venture event. He said the lack of job growth is a dark cloud in an otherwise healthy regional economy. Total employment remains above pre-pandemic levels, the reports show, but has declined by 0.8% between mid-2024 and mid-2025, with little net growth since 2022.
“I’m worried about the younger generation,” Beall told the San José Spotlight. “Many young people are coming looking for jobs.
Echoing a theme from last year’s findings, Hancock said on Friday the region’s economic inequality is the worst financial and economic gap anywhere in the world and represents a “state of instability” that in the past has led to “blood in the streets.”
The biggest contributor to the economic gap is housing. The median price last year for a single-family home in Silicon Valley hit $1.98 million — five times the national average, according to the report. A family of four would need to earn $488,000 a year to make it without financial stress, based on federal guidelines.
Silicon Valley’s population of about 27 million people has returned to pre-pandemic levels, which the report said is driven by immigrants from outside the US arriving in greater numbers than residents of the current area are moving to another part of the country. The report defines Silicon Valley as Santa Clara and San Mateo counties, as well as Fremont, Newark and Union City in Alameda County and Scotts Valley in Santa Cruz County.
But the overpopulation may not last. Stephen Levy, chief economist at the Center for Continuing Study of the California Economy in Palo Alto and a consultant to the Joint Venture, said federal immigration laws are restricting immigration—disrupting skilled workers and workers.
“We have two challenges for our competitiveness in the future: making the US more welcoming to immigrants and the ability to live,” Levy told the San José Spotlight. “High-tech firms cannot exist without the (foreign-driven) labor economy.”
There is also a shift in the age of Silicon Valley’s population, with residents 65 and older increasing 29% from 2014 and children under 18 decreasing 15%, the report shows. Hancock said this “silver tsunami” is already affecting local school districts with declining enrollment and closing schools.
Maria Nicoladoudis, executive director of the Hearts & Minds Activity Center in San Jose, which provides care programs for preschoolers and adults with dementia, said residents are struggling to find support for family elders. Older grandchildren in their 20s and 30s often go into caregiving, she said.
“If they are taking time off from work and school, then they are putting their future on hold,” Nicoladoudis told the San José Spotlight. “They are counting on their ability to build an economy and live in this valley.”
Contact Mike Langberg at [email protected].
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