Response to “The New Silicon Valley” Posting

I got a great comment on a previous post about Salt Lake City becoming the next Silicon Valley and wanted to respond to it here:

“Interesting. So what does this say about the job market and economic growth (particularly during this current recession)? Will SLC become saturated with small start-ups or is that even possible (a la the common argument: you can never have enough entrepreneurs!).

Is SLC competing against other demographics for the title of “New Silicon Valley”? Meaning, are there other areas with similar growth in the country?”

Great questions. The job market in SLC is apparently very strong, especially in comparison to other smaller markets. Take a look at this article. According to Forbes, the job market in Salt Lake City, “in all its tech-job abundance, looks like it will remain No. 1 since Forbes most recent ranking (2008).” Salt Lake is an enigma, really. In some ways it’s a microcosm. But it’s job market is not as strong as that found in more established markets, like certain pockets in Texas. According to the forecast data from Moody’s Economy.com, Austin, Fort Worth, Houston and San Antonio all rank very high. But I suppose it depends on the industry you’re looking at. For example, it used to be that California was the place to be for construction jobs. There are still a few areas that have retained that demand. But as the state has grown and become more saturated, demand in other industries began to replace the demand in construction.

As for technology and tech start ups, there is no arguing that SLC is a growing hot bed. I’m sure there are many more tech start ups in other markets like CA, especially the Bay Area. But if you’re comparing apples to apples then SLC is on track to become another silicon valley. The key to such a successful evolution is not in the rate of new start ups, it’s in the success and size of the firms. Silicon Valley has a lot of tech start ups and investors. And many of these, like Google and McAfee have crossed the chasm and become very successful. That hasn’t happened yet for SLC on the same scale as Silicon Valley. I mean, not many people have heard of Idealy.com or NLE beyond the Salt Lake Valley. In fact, not many within SLC that have even heard of them or many of the other 5,200 tech companies listed on siliconslopes.com.

Still, increased entrepreneurial activity serves to stimulate any economy, which obliges a great need to ensure that entrepreneurs and the small business community have the resources they need to succeed. Therein lies the danger of Obama’s “stimulus” package.

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