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About this blog: I grew up in Los Angeles and moved to the area in 1963 when I started graduate school at Stanford. Nancy and I were married in 1977 and we lived for nearly 30 years in the Duveneck school area. Our children went to Paly. We moved ...  (More)

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Recent Job and Population Trends

Uploaded: Mar 10, 2014
The community is about to begin a process to update the Housing Element. The central focus is on the short term from 2015 to 2023. I know that staff is especially interested in identifying sites for housing that is affordable to lower income households as well as planning for the expected increase in housing demand. I know also that individual council members and community members had concerns about the regional projection process that led to the eight-year housing planning targets for Palo Alto.

To provide context for the Housing Element update, this memo summarizes the recent revisions to estimates of job growth in our area and the region and also provides an update on California Department of Finance population estimates and projections.

Strong Upward Revisions to Bay Area Job Growth Estimates

The state Employment Development Department (EDD) released revised job estimates on March 7, 2014. They show much stronger recent job growth for the state and region than was previously reported.

As currently reported the Bay Area added 54,300 jobs in 2011 (+1.7%), 118,500 jobs in 2012 (+3.7%) and 134,200 jobs in 2013 (+4.1%). These are all roughly double the national growth rate.

The San Jose metro area, which includes Palo Alto, added 23,500 jobs in 2011 (+2.5%), 46,100 jobs in 2012 (+4.7%) and 45,300 jobs in 2013 (+4.4%) outpacing the region, state and nation.

The job gains occurred in professional services, information services and construction as well as gains in population serving sectors. This growth occurred even as government jobs were in decline, a trend that is now slowly reversing.

A portion of these job gains came as previously unemployed residents found jobs and thus did not add to population growth and housing demand. But unemployment rates on the peninsula are now in the 5% range and company plans for expansion remain strong.

Recent Population Trends

The Bay Area led all regions in percent population growth between July 2010 and July 2013—the latest data available. The region added 221,300 residents or an average of 73,800 per year. Santa Clara County added 67,300 residents or an average of 22,400 per year and was the second fastest growing county in California behind Placer.

The next population estimates for January 1, 2014 will be released on May 1, 2014.

New DOF Population Projections

DOF is beginning the process of developing new population projections that they hope to release by year end.

The new process will involve coordination with ABAG and incorporation of regional job projections as required by DOF methodology (it was not done last time) and incorporation of the recent job trends described above.

While the future is uncertain, at the moment both regional and county job and population trends and outlook are running ahead of the growth expected in the recent ABAG Plan Bay Area projections.

Comments

Posted by Resident, a resident of Another Palo Alto neighborhood,
on Mar 11, 2014 at 10:06 am

Bay Area job growth trends in 2011-2012-2013 are issues of Fact.

How Palo Alto should act on this data is an issue of Religion.


Posted by stephen levy, a resident of University South,
on Mar 11, 2014 at 1:21 pm

stephen levy is a registered user.

@ Resident

I am not sure what you mean by Religion but, yes, Palo Alto has a choice as to how to react to the strong regional growth.

My first concern is to have Palo Alto in recognition, not denial, about the strong regional and county job and population trends that are continuing.

Despite the very high land prices in the region, companies and people are expressing a desire to be here.

And, yes, the growth does make traffic worse and pose other challenges but to me it sure beats the heck out of a recession. And, yes, not everyone is participating but more ARE participating as a result of the strong job growth.

My hope for Palo Alto and other cities is that they take the regional job growth trends into account including the growth in older baby boomer population that is just beginning and the trend toward multi-family housing seen up and down the peninsula and reported nationally yesterday in the Wall Street Journal.


Posted by Joe, a resident of Barron Park,
on Mar 11, 2014 at 2:04 pm

> My hope for Palo Alto and other cities is that they take the regional job growth trends into account including the growth in older baby boomer population that is just beginning and the trend toward multi-family housing seen up and down the peninsula and reported nationally yesterday in the Wall Street Journal.

The number of ideas in this single sentence is confounding.

My take on the numbers quoted is less flattering. For years, the forecast numbers were too high. Now, we see that the short term forecast was low. That doesn't indicate a need to rush to build high density multi-family housing up and down the peninsula. It simply means that there is a lot of volatility in the Bay Area labor market. Of course, it also indicates that the forecast models are pretty lousy at predicting anything and probably should not be trusted.


Posted by Jay Park, a resident of Jackson Park,
on Mar 11, 2014 at 8:24 pm

> My hope for Palo Alto and other cities is that they take the regional job growth trends into account including the growth in older baby boomer population that is just beginning and the trend toward multi-family housing seen up and down the peninsula and reported nationally yesterday in the Wall Street Journal.

It is unlikely that the baby boomer generation will contribute much in the way of new jobs or housing demand. Baby boomers are starting to retire and there isn't much in the way of boomer immigration to Palo Alto.

The local population growth is mostly from Generation X who can now afford Peninsula real estate. In 8-10 years, the focus will shift toward the Millennials, but their time in Palo Alto hasn't arrived quite yet.


Posted by Margaret Fruth, a resident of Ventura,
on Mar 14, 2014 at 5:21 pm

Margaret Fruth is a registered user.

The Buena Vista Mobile Home Park is the largest low income housing project in Palo Alto. Evicting the residents and tearing it down will exacerbate the existing jobs/housing imbalance.


Posted by Garrett, a resident of The Crossings,
on Mar 14, 2014 at 5:30 pm

Every 20 years the prices have gone up, housing supply has gotten shorter which you would think being at the tail end of the baby boomers the house prices would get smaller. I am 50 years old, I don't expect the senior housing get affordable anytime soon, because like I said prices have risen and supply grew short.

Supply and demand, well you would expect to build housing in a thriving area, not get by with less. All the baby boomers before me are making more money them me, I am not blaming or going to hark on that. That is what parents want their children to do better, but that is just it.

Your children will be entering the work force by entry level jobs in school, they are growing short. If they graduate from college with little or no money loaned, great then can buy a home. If not, good luck in setting out.

Not everyone wants to get in deep with loans, in some cases that is a good thing, chance are they are going to worry about the next big thing, instead of their high debt.

I would imagine 2 great business men would find if to build stuff in their garage, neighbors would complain, expansion would be hard, NIMBYism, and even move would be fought. I am talking about H.P. as if starting out today.


Posted by Garrett, a resident of another community,
on Mar 14, 2014 at 5:38 pm

What about all the low to middle income jobs that have been created, now remember if someone retires for a job, a new person will have to take their job.

If someone builds more retail/adds more service based jobs, see baby boomers needing services. You will need more housing.

If more and more people have kids with the ability to hire a Nanny, you will need more housing.

Like i wrote house prices are rising, supply is short and demand is growing.

Somewhere along the line you will more high income person then service givers because no one and I mean no will drive in the long distance to serve you.

Your taxes won\'t be enough to build housing, costs will rise for hiring anyone.


Posted by Garrett83, a resident of another community,
on Mar 15, 2014 at 3:38 pm

Garrett83 is a registered user.

You know more people should be commenting on this subject, most people have or desire a job,employee, position or work. We depend on a population that is employed, earn a living to keep businesses going.

We talk about the children who are part of the population trend and who might be seeking jobs, housing and food


Posted by stephen levy, a resident of University South,
on Mar 15, 2014 at 4:01 pm

stephen levy is a registered user.

Thanks for trying to get a conversation going Garrett.

My sense is that many posters do not like the implications for housing of this strong economy and try to dismiss them.


Posted by Garett, a resident of another community,
on Mar 15, 2014 at 6:06 pm

I am quite supportive of growth, I agree things to need to change but if done in a orderly well planned fashion. See infrastructure. I read in one of the big newspapers about 60,000 jobs in tech were created.

Creating jobs are a good thing, I am not blaming the tech industry, times are good which means people are spending money which I don\'t have a problem with people spending money, but it means more jobs are being created.

I am hoping someone will wake up and realize if is making 50,000 dollars before taxes, you will have hard time paying the rent or if you commute in to work which in time gas prices will spike.


Posted by the hallowing of the 1%, a resident of Another Palo Alto neighborhood,
on Mar 16, 2014 at 2:11 pm



No sensible policy promotes concentrating housing in a job rich small town/village instead of encouraging jobs to other areas which need economic activity.

This sort of talk perpetuates the rule of the 1%.





Posted by Garrett, a resident of another community,
on Mar 16, 2014 at 2:56 pm

Lots of places need job growth but they aren't getting it for reason that might have to do with schools, location, desirability or close proximity to high educated skilled workforce. More people here have BA, BS, Master or higher training per square mile which you won't find in Podunk.


Posted by the hallowing of the 1%, a resident of Another Palo Alto neighborhood,
on Mar 16, 2014 at 3:18 pm


Garrett,

Companies want a vanity address and they want to sell to the 1%. It becomes a cycle of pure materialism.

It's more likely that innovation thrives in places which are not plagued by the materialistic assault (What Palo Alto used to be). BA's BS's and smarter people will eventually leave places like the "new" Palo Alto, and remain a Bloomingdales and tapas circus.




Posted by the hallowing of the 1%, a resident of Another Palo Alto neighborhood,
on Mar 16, 2014 at 3:21 pm



Meant to say, the "new" Palo Alto can remain as the Bloomingdales and tapas circus it has become. Oh, plus housing.

That is not sensible policy.


Posted by stephen levy, a resident of University South,
on Mar 16, 2014 at 6:31 pm

stephen levy is a registered user.

Hallowing has some incorrect assumptions and some wishful thinking.

Companies are free to locate elsewhere but most want to be where their most talented workers live and that is AROUND HERE. Encouraging or bribing Google or others to move far away from their labor force is the opposite of sensible public policy and is doomed to failure.

It is another wishful thinking trick of the mind to avoid the clear evidence that despite much cheaper land costs elsewhere tech and other companies want to near PA and the peninsula. It is demonstrably "NOT more likely" that innovation thrives elsewhere or the workers and companies that pay top dollar to live and work here must be really stupid--I doubt that.

The "its the 1% argument" is just false. Most people who work here and make even $100,000 to $200,000 are nowhere near the top 1% in the nation and far from it in the Bay Area.

Most people that buy or rent in PA are not in the "1%". Hallowing is just wrong in this regard.


Posted by SteveU, a resident of Barron Park,
on Mar 16, 2014 at 9:02 pm

SteveU is a registered user.

Garrett is spot on about affordability. How many retail or support jobs pay 50K+ ? What would that level of income allow you to live in IN Palo Alto?

There was a time when one neighbor was a CEO and the other one a building custodian. Now you businesses and homes are cared for by people that must commute 50 miles or more to work for minimum wages.
When is Palo Alto putting up the border signs: Millionaires Only


Posted by stephen levy, a resident of University South,
on Mar 16, 2014 at 9:57 pm

stephen levy is a registered user.

@steveu

So do you have any solutions?

How about smaller units, taller apartment buildings, more subsidized housing?

The situation in PA is not much different (a little more expensive) than up and down the peninsula. Prices and rents are rising as there iscacshortsge of housing and land is very in demand and expensive.


Posted by the hallowing of the 1%, a resident of Another Palo Alto neighborhood,
on Mar 16, 2014 at 10:53 pm

stephen levy,

"The "its the 1% argument" is just false. Most people who work here and make even $100,000 to $200,000 are nowhere near the top 1% in the nation and far from it in the Bay Area."

Before you say it's false, would you have data on how many property owners in PA could be in the 1%? But you don't have to take it literally, what if it was the 10%, it's the same idea.

I disagree that a regional policy of encouraging economic activity in other areas is wishful thinking. I would call it the road less traveled because of course it's more appealing to stuff more people in smaller housing in a hot market. Who wouldn't rather just milk a cow with milk.

Palo Alto is on a downward spiral because it now attracts businesses that can afford the vanity address. This kind of heat is not for innovators, it's for consumers. People who need the tapas bars and the glitz.

Added housing and more retail and more "vitality" would be expected.


Posted by Garrett, a resident of another community,
on Mar 17, 2014 at 8:14 am

People buying into Vanity addresses, OK I admit that could be valid argument but it would be sad the only people who ended up in Palo Alto just because. One of many homes, no connection to tech or the area economy. Really, there is people who just own a home because, the world wide 1 percent.


Posted by Garrett83, a resident of another community,
on Mar 17, 2014 at 9:13 am

Garrett83 is a registered user.

We still have to deal with housing for those who work a wide variety of jobs. This issue is not just Palo Alto or Silicon Valley but the 9 counties. Transportation between communities would help, mass transit that is east to west would help more then the traditional south to north.

Affordable housing in the easy bay communities, yes you will see tall buildings from the Baylands. Growth on El Camino, Mission Blvd and other outdated commercial strips.


Posted by resident 1, a resident of Adobe-Meadows,
on Mar 18, 2014 at 2:34 pm

The topic of transportation and housing are actively being pursued in North San Jose which is where the Silicon Valley jobs are, as well as wall to wall apartments being built in the segment Montague Expressway to HWY 237.
They are extending BART through here up to Santa Clara.

If you go north to San Mateo a whole new city is being built on what was a racetrack. The ads feature Caltrain as the focal point for this new city addition.

It is all happening is areas which have the job opportunities, space and infrastructure. What they are doing fits into the space.

The Palo Alto conversation which I saw on the CC meeting 03/17 keeps going in a circle with no conclusion.

The big job opportunities are elsewhere if you are not employed by Stanford or a law firm. Stanford occupies a big piece of space on the peninsula and unless you are a student or employee you will not get a piece of that space.

That is the logistics we are dealing with.


Posted by Garrett , a resident of another community,
on Mar 24, 2014 at 12:14 pm

While North San Jose along with Downtown San Jose adds both housing and jobs, Samta Clara and Miliptas plans for job expansion. Don't forget Cupertino, Sunnyvale and Redwood City continue to plan job expansion with their city borders.

Housing struggles to keep pace and space is at a premium.

Note I am not saying everything just build apartments. Some where hetween the single family and the high density must be other types of housing for everybody between the young single college grad or older person who lost their life long partner and wants to downsize.

Great cities of the the.world have single family homes, units in suburban setting near medium density. I don't hear much about medium density much and those types of units.


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