Oracle Moving HQ to Austin
sec.gov
sec.gov
Tesla will likely move its HQ to Texas following Musk's move (if it hasn't already), which would seem to be in line with Whyte's rule. However, it is likely both would have the same underlying reason (legal, financial, taxation or otherwise), rather than just "making it more conventient for musk".
I wonder if Elison or Katz have also moved to Austin recently ......
[0] https://www.joelonsoftware.com/2003/03/28/finding-an-office-...
1.5% of the company is still a solid portion. Especially if Musk ever needs to sell shares for some reason and needs an ally with substantial ownership to align with him for continued control
Look at the google ML firing/resigning storm, in the 50s someone fired end of story not the CEO saying they will investigate (honesty transparency aside)
Which of those is the case is hotly debated. The legal concept of “constructive termination” recognizes that detailed inquiry into the history leading up to the end of employment may be necessary to distinguish those two things, and in this case its even debated whether it was firing or resignation in the superficial sense, as well as being debated as to whether it was constructive termination even if superficially resignation.
See, for example, http://online.ceb.com/CalCases/CA2/174CA2d184.htm, a Supreme Court case concerning wrongful termination from 1959.
In some ways maybe.
In the 50s your wife stayed home to work while you worked a blue-collar job, probably having only a high school diploma (if that), and your blue-collar job supported a family of 2.1 kids, your wife, Rex the dog, a car, and a mortgage in the suburbs. Oh and it probably came with a pension. Everyone smoked indoors. Companies felt obliged to look after their (male) workers and sexual harassment of female employees was routine and casual racism was baked-in to the culture.
Over the years CEO pay has risen something like 1000% and worker pay less than 20%.
Now companies spy on their workers and engage in union-busting while paying their workers a pittance such that even a person working two minimum wage full-time jobs is barely able to sustain a family in the USA and Canada. We don't smoke indoors any more. Sexual harassment of female employees is still routine and casual racism is institutionalized but perhaps less overt today.
I guess society can pride itself of the smoking thing but we've either made no progress or regressed in a lot of ways.
>someone fired end of story
Take off your rose-coloured glasses.
Please define what you mean by routine here.
Can you expand on what you mean by “casual racism is institutionalized but perhaps less overt”?
TX has lots of cheap land, low taxes, business-friendly politics, low cost of living (for employees)....CA is basically the opposite and getting worse.
ETA: there are very real reasons big companies have reconfigured workspaces and it isn’t about worker efficiency studies or even fitting more people into a space, but about taxes.
I wish I had more direct information. I was informed of this by a tax attorney, when I was complaining about how our shared employer was shifting away from individual offices, which had been a hallmark of the company and corporate culture. He told me that there had been some changes to the local B&O tax law that helped make the argument to to shared/team/open spaces. I did some research and found he was right, though again, the specifics are going to differ depending on where you are, what business you’re in, the size of the business, etc.
Could you point to a government website with additional information?
> employees pay income tax
Generally, it’s the state where you work.
It can be complicated when you live in one state and work in another.
But the location of your corporate office is absolute irrelevant for where an employee pays taxes.
The employer’s HQ generally has no effect, independently of it being a worksite for many employees.
So all non-CA employees have less of a tax burden as a result of the HQ relocation.
The concept of "work done for California" does not exist. If the work is done in Texas (at your house), you pay Texas taxes (no income tax).
Many states have similar clauses (NY, NJ, etc.), CA is not unique in this aspect.
Some states are more aggressive than others. Although you're right in general, there is actually a history of CA going aggressively after the money of residents of other states, like the screenwriter in AZ that did a lot of work for a California customer: https://ota.ca.gov/wp-content/uploads/sites/54/2019/08/18032...
Incorrect, you kind of have this backwards. If you're a resident in another state (Texas), and are conducting work in that state (Texas, home office), then HR has to make sure they're conforming to the labor laws of that state (Texas), not the state of the office where you used to work (California).
>You could maybe fight with the State of California for the refund next year, but in the meantime you'll pay taxes in the state if your paycheck says so.
That's why it's pertinent to change your residency as soon as you move, and then update HR the same day. Else you're fighting an uphill battle for no reason.
>If your desk is in NYC, but live in CT or NJ, you'll pay taxes in two states, even if you haven't set foot in your office for months.
No longer true if you no longer actually work there.
>You can try changing your residency to e.g. Texas as you say, getting assigned by HR to a new office or marked as remote, but you can bet that the original state will try everything in their book to keep some of your money.
And you can give them the middle finger because they're wrong. Spending $300 to get your taxes prepped by a CPA will stop 99% of this shenanigans.
>Although you're right in general, there is actually a history of CA going aggressively after the money of residents of other states, like the screenwriter in AZ that did a lot of work for a California customer
That's because he was deriving his income as a unitary business from entirely California sources: https://www.forbes.com/sites/robertwood/2019/10/22/now-calif...
Again, a lot of states have similar laws on the books (VA, NY, etc.).
Source: I used to be a paralegal, and have worked remotely for a long time in various states.
The moment I left California the state I paid income tax to changed.
Think of it this way: all of the government services I use are in the state I reside in. I use literally $0 in California services. Not police, not fire department, not roads: nada.
California had a reputation for being very strict about whether you are a “resident.” But it’s not infinite.
Once you’re gone, they can’t tax you.
There are some exceptions for people who live near in a neighboring state, but work physically in California.
In yes, for no.
> How do you get health insurance?
Through my employer, like many employees.
> Does your company have an office in your state?
Yes, though I've not seen the inside of it with my eyes since March.
> If not, do they give you Californi-based coverage, with most providers being out-of-network?
While your question was conditional on the office, no, the CA-specific health plans are only available for CA employees. Non-CA employees have a different set of options. (Sadly: I was rather fond of Kaiser.)
I was asking because my son works for a tech company and was told that he could only move to states where they had an office, because that's where the company already has health coverage.
Since insurance doesn't cross state lines, if had wanted to relocate to South Dakota they would have to get him coverage with Blue Cross of South Dakota (or whichever carrier) which would require cost and administrative effort. Maybe they just didn't want to go through the trouble for one employee.
Non-Quals are prorated
ISOs are taxed in state where exercised
Not for people that remain in CA, WFH or not. For those that move to TX, what you said applies.
Interesting this sentence is at the end of this 40+ page document under the section "Other Information". The very first page says 2300 Oracle Way Austin, Texas but their previous quarterly reports shows 500 Oracle Parkway Redwood City, California
Yet many are assuming that employees will be moving from CA to TX, despite no indication of that.
It's a beautiful building that gentrified the whole area, for better or worse. I ate there a couple of times, it's nice inside too!
I love biking/walking around the Oracle campus area because they made a bike path and the area is safer than it was before. That being said, I know a couple of people who work there and they don't like their job - it's thankless - but I think that's the same with all big companies where you're just another number.
When the pandemic hit everyone started working from home and this mega-building was pretty much empty. I am not surprised they're gonna move their HQ here. That's because they got plenty of office space to fill amongst other reasons. Also with favorable taxes and lots of space to expand (if they ever need to) as they hire more and more people. Good thing for those who purchased homes near the campus! Their value will keep increasing as more "execs" move here after the pandemic settles.
I’m not surprised. I haven’t met anyone who deals with Oracle because they want to, only because they have to.
1) Their sales demos (which we recorded) pitched functionality that literally did not exist or was EOL'ed from the system without a replacement before we implemented.
2) It was a fixed-price contract, and when they screwed up & couldn't deliver on their benchmarks, they refused to continue working without additional payment
3) Paid customizations were developed in bad faith & without the contracted specs. In one example, there was a simple requirement: Users could enter a long blob of text, and clerks could review it as part of the user's record in Peoplesoft. They delivered the first part, not the second. When we asked where that functionality was, they said they didn't need to build anything more because the data was available to clerks via the assistance of a DBA.
The implementation failed, we got a settlement, and chose a different vendor while out Legacy system limped along for a few more years.
The worst I've seen so far was at Amazon. When some people wanted to get up from their desk, they had to ask their desk neighbor to stand up so they could pass through.
No, that is specific to Oracle. Here's some references [1]. The other day on HN I read a quote: "What is the difference between Larry Ellison and God? God doesn't think he's Larry Ellison". Can't find it though.
That general area of the Town Lake trail was always my starting point for runs. My favorite “section” was definitely the trail on either side of the dam. I would park in the lot across the lake from the now Oracle campus and start most of my runs there. I ran thousands of miles with that as my starting point (I was training for ultramarathons) and never felt unsafe. That started in 2010 so I can’t speak to safety before then.
I liked the character of those neighborhoods and everything they had to offer. The JuiceLand on Cesar Chavez always brought out the most interesting characters in various states of mind on Saturday and Sunday mornings. There was always a pickup basketball game going at the Metz Neighborhood Park, and sometimes I would take a break there to refuel and watch for a few baskets. The Oracle campus is on the other side of the lake from there but I think it still had an influence on the neighborhood even that far removed. I won’t say it was a completely negative influence, but it definitely made things less interesting to me. The east side in general was trending in that direction though, so I’m sure it wasn’t all at the feet of Oracle.
I don’t live in Austin now. It was nice to reminisce about long runs on Town Lake so thanks for that!
- Small bars/businesses
- Parks/Green areas
- Free parking
- Playgrounds
are being deleted from the map one by one
and they're being replaced with: - Hotels/Large apt. complexes
- Huge buildings for big corp/large comp
- Paid parking/parking lots
- New age bars and posh restaurants
- Homeless camps
but it's safer to go out out at night at least...if you stay on the main roads
I wonder if there will ever be an exodus from Austin similar in scope to the influx of the past decade. If I could time travel I would definitely visit Austin through the years to see how it was and how it ends up.
Made my day to see this!
[1] https://www.youtube.com/watch?v=iajyvVaeFS4&ab_channel=JRECl...
June. 92° / 72°
July. 96° / 74°
August 96° / 74°
Average high/low temperatures in the summer for Cupertino are:
June. 75° / 55°
July. 76° / 58°
August 76° / 58°
Austin will never, ever be like Silicon Valley because of this. The freedom you get from cooler weather is great from an energy utilization stand point and for allowing safer and more desirable conditions outdoors. Not to mention you have much more beautiful choices of nature in Northern California. Think about whenever you travel to Austin for conferences, it's oppressively hot and you basically travel from one air conditioned building to the next. Now imagine 10 years time of increased global warming. California will still be coastal to one of the coldest waters in the world at this latitude, which is a natural air conditioner. To me this spells the end of Oracle's supremacy in anything other than selling smaller and smaller volumes of mainframes.
"Austin Makes Top 10 List Of U.S. Cities With The Greatest Increase In Hot Days" -> https://www.keranews.org/2019-08-22/austin-makes-top-10-list...
Wow, 0.1 degrees more, that will really tip the scales
I live around Oakland. The number of days, in the last decade where I wished I had AC went up 10x. I literally had days where I camped out in my basement. With a fan blowing on me. That never happened a decade or more ago. Ever.
That said, the pollen is terrible.
That’s almost as much as California this year. If you have that much hubris as to think another event won’t happen like that in Texas with increasing frequency, then I guess enjoy Austin?
You're making the mistake of assuming access to nature is a priority for everyone, which I think is a consequence of the cultural bubble that Silicon Valley is in. Most people who are part of the scene are into nature stuff, and they assume everyone is because they don't know anyone who isn't. I have definitely heard of people who moved to SV/SF for a job and then being looked down on and sometimes even bullied by coworkers for not having any interest in nature activities. There is very much an attitude that if you don't partake in the Standard Silicon Valley Hobbies then something must be wrong with you.
By contrast, I've lived in Texas all my life and I don't know many people who's really into going hiking and stuff all the time. A couple of people, sure, but most people I know are content to only do the kinds of activities you can do in an air-conditioned room.
I would imagine there are a lot of tech people who moved to NorCal for work but aren't comfortable with the culture there. They don't care about nature and would be happier if they got to socialize with coworkers who had similar interests, and so they might be much happier if their employers relocated to Texas or something. And while I can't really speak to Austin, my experience in Dallas is that the tech scene (which is thriving and active) is much more enterprisey and doesn't really attract people who would prefer a more SV-like culture.
Commentary from someone who only visits Texas in the summer is bound to be one-dimensional.
> To me this spells the end of Oracle's supremacy in anything other than selling smaller and smaller volumes of mainframes.
True because average regional temperature has always been a solid predictor of company success, which is why companies like 3M, Cirrus Logic, Dell, Indeed, National Instruments, and Silicon Labs all collapsed after establishing their headquarters in Austin due to talented employees leaving en masse for the beauty of other regions /s
Also just wait for Analog Devices to buy Cirrus and relocate them back to SV. (Totally kidding)
That is a concern.
But part of SF's problems is structural: transportation and new construction are constrained by water. That is much less of a concern in Austin.
At Austin's current rate of growth, by the time Project Connect makes any material progress, it'll already be obsolete and overburdened.
Austin TX wasn't rich 20 years ago, where was the money going to come from to build a nice transportation network? It's booming at present and will be very rich 20 years from now (most likely). It has a bad transportation network because it was underdeveloped for the prior decades as with much of Texas. The question going forward is what they'll do with their growth and rising affluence, how they'll utilize that (or not).
Just look at NIMBYISM in California, that's not the product of the newcomers, but of people that have been there for 40/50 years. So it takes time. Maybe in SF the turnover is faster, but not necessarily in the whole valley
There are two types of people moving from Cali to Austin: people who can't afford living there anymore, and people who can easily afford it but are tired of paying high taxes. The latter group tends to be on the more conservative side (essentially the FYGM section of the political spectrum) and their wealth does give them the ability to influence local politics.
So, if anything, Austin, one of the most liberal cities in America, is more likely to shift to the right as a result of these migrations from California and other blue states.
edit: downvotes by conservatives are laughable lol, keep them coming guys!
NIMBYism and desires for high-paying jobs cut across the American political spectrum.
(Existing property owners in Austin, however, may be ecstatic if their property is suddenly priced like SF value... but that doesn't mean they're gonna want to relax zoning and increase density and change the shape and character of their neighborhoods, like we're told is the answer for SF.)
(And of course, fleeing higher prices by nature means that *demand is overall higher in the place you're leaving. Which makes it hard to say it's been "ruined.")
The difference is Gov. Abbott will eventually drive those icky poor/homeless under the overpass out by taking over APD and busing them to CA. Progress. /s
If low service means that, then yes, sign me up. I don’t see much value in California “services.”
https://www.kxan.com/top-stories/cedar-pollen-reaches-highes...
or to put it like one of the folks here: "you peed in your pool and moved to ours, don't do that again"
It has a lot to do with economic success and the wealth produced thereby. The extent that has to do with the distinctive local politics of the state is another argument.
If anything you could argue that's an anti-liberal attitude. It's great the Bay Area is so tolerant of different folks. Except that doesn't help out the black transgender teenager from Mississippi who can't move there, because he's priced out of even the lowest-end apartment. All because some millionaire home owners don't want to see their property values appreciate at a slightly lower rate.
The book _Ishmael_ had an interesting perspective on that.
Go to Wyoming or Idaho and people feel the same way. California has unfortunately been exporting its ridiculous cost of living and lifestyle to the American west for decades, Austin is just the latest to feel it.
Somewhat related, Austinites used to also have a fairly common saying "Don't Dallas my Austin" (also related: "Keep Austin Weird"), referring to wanting to keep the "corporate" feel of Dallas out of Austin. The ship's sailed on that one too, though.
The Californians, after years of having higher salary, more savings, and a job that lets them move, goes to Texas and offers $400k for that same house. The Californian thinks it's a great deal, because they get the same size house they previously lived in for only half the price! And the seller thinks it's great, because he now suddenly gets a huge premium on his previously-valued-at-$250k-house. All of the real estate responds in kind, expecting to get $400k+ from all the Cali transplants. However, the average Texan, who doesn't have that high paying salary, gets priced out and can no longer afford a house in their city.
This has been happening en masse to the northern suburbs of Dallas, as well as many neighborhoods in Austin. It's gentrification, more or less, and it comes with all the same problems.
Nobody pays more for something just because they have more savings. They pay more because they might be getting outbid by someone.
I don't see the purpose of characterizing that as "California exporting higher costs of living".
People with more money outbid people with less money all over the world all the time. You can say "Americans are exporting higher cost of living" by purchasing avocados from Mexico, or factory capacity in China, etc. and depriving the locals who can't afford to pay the same.
I'm sure the people in the poorer neighborhoods of Dallas and Austin are complaining about the richer neighborhoods exporting a higher cost of living.
No, they pay more because they can afford it. When a bidding war starts between a Californian and a Texan for the same house, the Texan loses every time because they can't bid as high as the Californian.
It isn't just housing, either. When a new grocery store opens up in one of these neighborhoods, do you think they just sell their goods as cheap as they always have? Of course not. They want to make a profit, so they up their prices because they know the Californians are more than willing to pay for it. The Texan who now struggles to make ends meet because food is more expensive? They get pushed out.
> You can say "Americans are exporting higher cost of living" by purchasing avocados from Mexico, or factory capacity in China, etc. and depriving the locals who can't afford to pay the same.
Yes, that is exactly what is happening. Have you ever been to any of these countries where Americans-with-money swoop in and starting buying up goods or property? They hate it, just as much as Texans hate the Californians who are moving in.
E.g. Are CA's policies more conducive to wealth creation, and then are people taking advantage of arbitrage opportunities elsewhere to guard that wealth?
That makes no sense. If the housing prices in a market go up, it is because there is more demand without an increase in supply. Not because a certain group is paying almost double the market value for absolutely no reason.
And then there's the issue of property taxes. A Texan lives in his nice $250k house and pays $X/year in property taxes. Then someone comes in and buys the house next to them for $400k/yr. Suddenly this neighborhood is now appraised at a much higher value than before, and the Texan's property taxes are now twice as high, bordering on the edge of unaffordable. I've personally seen several people be priced out of an area due to this.
Ask a Californian about prop 13 ;-)
Texas won't become California, even if 100% of CA's population moves there, because they don't have the same pants on head dumb proposition system.
That seems like a Texas problem being blamed on Californians.
I'm sure a lot of Texans are very happy that their houses have shot way up in value.
I don't understand not caring about 6 figures of money. Is that really the outlook of the average California tech worker?
Another example is Trump's Tax Act, which capped "SALT" deductions (State and Local/Property Taxes). This impacts housing prices relative to rents because you can't deduct the full amount of your property tax in high value states like California.
These are two examples...
The caller was indignant: "It would be un-American not to try to get the highest possible price for your property"
The defense rests.
I see a similar defective thought process right here in Berkeley, CA. Everyone here blames housing demand on peninsula companies like Facebook, Apple, and Google but it's a fact that employment right here in the city of Berkeley has been allowed to double in the last 30 years while the city built zero net dwellings. We can try to blame it on distant villains but the gentrification, to borrow a meme, is coming from inside the house.
By contrast, the "Californication" period (say, 87-94) and the tech boom actually took place in the city itself. Keep in mind that in the 87-94 period, Boeing and UW were still the two largest employers in Puget Sound. Companies like Microsoft were "good" for the economy, but they weren't quite the behemoths that they became as the tech boom happened (and, coincidentally, as I left :)
https://www.nytimes.com/1992/06/28/business/microsoft-s-unli...
Were the MS people buying ships full of Porches with equity earnings or salary?
It seems like that but the actual phenomenon is simply the slow, increasing urbanization of the United States.
There are, of course, actual Californians moving into places like Austin and Bend and Colorado Springs but with or without them, the American expression of 21st century urbanism is what we're actually witnessing.
California the place just happens to be 15-20 years ahead of most of the rest of the country on that path to urbanization which is why it's so easy to mistake it for "Californication".
As evidence I would put forth Minneapolis: this is not a place that many Californians are moving to and yet they are experiencing the same kind of anti-zoning housing movement, they bemoan exploding housing prices and they aspire to the same cultural and societal progression that everyone in the Bay Area would recognize.
I maintain they are not experiencing "Californication" - they are experiencing urbanization.
California today is, for practical analytical purposes, a state with a fixed number of houses. This means we're currently operating in a regime where only the most successful and luckiest people can remain here. Unless we restart our housing production, this will continue.
Yes, that is what I was referring to when I spoke of an "anti-zoning housing movement". That is a political movement that, I believe, has its roots in California.
And yes, I agree with you that it has progressed further in Minneapolis than it has in, for instance, the Bay Area.
Both Northern California and Southern California on the other hand have hills/mountain terrain which constrains suburban development.
You could argue that it's the longtime locals in the Bay Area, those who bought homes cheaply in the 60s/70s, that are usually the NIMBYs voting for the policies that caused the current state of things.
Those same people are the least likely to be the ones leaving for Texas.
"It's cheap here in Texas but why don't you have ___thing that costs millions in tax dollars___"
Also, if you saw big new house with a wall of glass facing the sunset, an Austinite would ask "Don't they realize how high the A/C bill will be? Who would buy such a place?" The answer" "Californians."
OTOH, a few established firms with large campuses leaving also means a lot of space without the usual problems involved available for other established firms that get into lots of conflicts with other local constituencies when they try to expand.
after they get their green card, they fan out to smaller companies/startups....
so, yeah, it is a loss.... (albeit small) for the bay area
If I'm a SV startup I already have problems with office rent, taxes, cost of living, etc. It's expensive to be in the Bay Area. And on top of that, most of the engineers I hire will either be of worse quality than FAANG or I'm going to have to pay them more than FAANG. While this is great for the employees, it's really hard to fit into the budget for many startups and the tradeoff becomes existential when the cost of your engineers starts adding up but you haven't found market fit yet. And the ever-increasing wages being used to draw people from one company to another just keeps making the Bay Area more and more unaffordable so the problem keeps compounding.
It works nicely when there's just one or two big companies to draw employees from, but there's just so many big SV companies now with billions of dollars in their pockets, I don't see how any true startup could possibly compete. If you don't like Google, you go to Uber. Or Facebook. Or Splunk. Or Airbnb. Or Yelp. Or Twitter. Or Facebook. Or Salesforce. Or Workday. Or Juniper. Or Autodesk. Or Nvidia. Or Palo Alto Networks. Or...
There's just too much competition from the billion-dollar companies. Sure innovation and entrepreneurship still happens in SV, but I'd argue it would be better for the area if it were easier for smaller startups to compete.
I interned on their SQL engine team and maybe half of the long-time employees were ex-Oracle, including two of the three co-founders (Thierry and Benoit).
I'm going to go ahead and say Tesla is in the same boat as Oracle or HP, as a company where its biggest innovations are in its past. It will likely join Oracle in moving to Texas as a way to save money but not attempt to make further innovations.
Some will, some won't! Truth is, those who decide to offer compensation based on value added instead of a magic HR approved formula will get interest from everyone else. I expect some companies to use this CoL-based compensation as a way to let go underperformers and others to attract talent that was previously unavailable.
> Will smaller firms elsewhere have to raise salaries to compete with locals taking non-regional salaries?
They'll have to.
You're leaving out "what the candidate will accept"
People working remote in other locations will have higher salaries from SV companies since they are used to paying those salaries.
People moving from SV to other locations should expect moderate drops (10-20%). In my own experience moving to a 0% state income tax state, it effectively canceled out the savings from CA tax but the cheaper housing more than made up for it.
Longer term:
Tech salaries will come down as employers hire from a larger talent pool that is cheaper on average. This will make it hard for people in SV to work remote as they won't be as competitive. This probably means SV will become more affordable.
> be compensated the same as those in SV?
Generally speaking no, compensation has an aspect of location. Companies are going to have a harder time paying SV rates if they know you are in a cheaper area.
No. At larger companies, they already have these types of adjustments and will just be making more of them. For smaller companies, they’ll very quickly start to implement these types of adjustments.
Depending on where you go, the trade-off can still work in your favor, even with a lower salary. But COL calculators aren’t perfect and don’t change as often as the areas can. So you can be in a position where your COL rises but your salary, per the calculator does not.
When I moved to Seattle from NYC, I got a lower salary because of COL differences, even though the real COL is the same (and in some ways, is higher than NYC). Yes, rent in Seattle is going to be lower when directly compared to New York City (so same type of area/amenities/size), but your options are lower too, which can push you towards a higher priced house or apartment than you might choose in New York. I pay a lot more in rent in Seattle than I did in NYC. It’s a nicer place and the equivalent in Williamsburg would be higher, but I’d have more options that were less than what I pay in NYC that still fit my needs and are close to the places I need to be. Food prices and cost of good are the same (sales tax is higher in Seattle and there are fewer food options for delivery). It’s the state income tax that is the differentiator. That’s 10% of my income a year I don’t lose as I did in New York. And that can be significant.
If I left Washington for a place with LCOL, I’d need to calculate my lower salary against the real-world costs of the new place, plus any additional expenses (like owning a car and gas money and maintainable/insurance), and the tax implications of the new place. Going from California to Texas will be a big change tax wise, but going from Washington state to Iowa, which has a 9% state income tax and a LCOL, I’d need to calculate whether that lower salary would be a good enough deal for me to leave. And of course, you have to factor in the cost you personally value the place you live from a culture and opportunity point of view.
I like big cities. Cities have suffered tremendously with COVID because all the things we love about cities have gone away. But I’m still (perhaps stupidly) bullish on cities. I grew up in the suburbs of a major city but haven’t lived outside of a major metropolitan area since I was 18 years old. I have no desire to live in suburbia, even if the housing prices are low and space is plentiful. That just isn’t my thing. So the trade-off to do that would be require a significant increase in compensation.
But I don’t have children and I understand that lots of people don’t have the same affinity for big cities that I do. They are happy with those tradeoffs. To be able to buy a home or a condo for under $1 million. And for those workers, going from a $300k SF salary to something like $180k might be just fine.
But anyone expecting to make that $300k in Montana or Texas is fooling themselves. There will always be outliers who will be compensated more or the same, regardless of where they live. But those are outliers. It’s not the norm.
There are some that predict the move away from big cities will depress tech salaries in general. I think there might be some of that, but it just depends on how many people actually move. Part of the reason you have hubs in various industries like SF and Seattle and NYC and DC and Boston and LA is because that’s where a lot of the talent has decided to congregate. And talent!= company HQ. Atlanta probably does as much production work as LA does, but Hollywood and the film and television and streaming industries are still centered in Los Angeles. No studio executive is moving from Malibu to Buckhead (an actor or producer might buy a second house there, sure).
For tech, maybe there will be a wide dispersion. But I don’t think it’s a guarantee.
But Bend was already hot, and on people's radar. Yesterday I saw an article about housing heating up in Baker City Oregon. This is a small town of 10K people that is certainly in a nice area, but hasn't been known as much of a 'hip' place to be.
https://www.bendbulletin.com/business/realestate/baker-count...
There are quite a few smaller towns here and there throughout the west. It'll be interesting to see if the dispersion to these kinds of places is fairly uniform, if people stick more to already 'hot' places, and of course what happens when the pandemic is mostly played out.
Interests rates are at their lowest and the rise in property value should more than pay for it.
[0] https://www.dwell.com/article/prefab-home-office-accessory-d...
Although Bend's internet offerings are extremely sad, and I'm surprised the political power of the tech crowd hasn't forced municipal fiber to be a thing yet.
I think some people are more comfortable with less of that stuff. I could get by without Costco and REI.
The rest is a chicken and egg problem. If you start attracting high income remote workers there should be more stores setting shop.
The Mom & Pop coffee shop and hardware store.
The ability for their children to live down the street, because they have been priced out of the market.
There are many things that change when your house and land are worth more money.
I mean, yes, nice place. Not near anywhere. If you like ranching/farming communities with mountains nearby, it's pretty good. But how are internet speeds? And if you need to come back to "civilization", where's the nearest airport with commercial flights?
But you can buy a lot of house for the same amount of money that would get you a dumpy, nondescript place in an anonymous part of Bend:
https://www.realtor.com/realestateandhomes-detail/2405-2nd-S...
To say nothing of the Bay Area.
It doesn't take a lot of people moving in to start changing prices in a town that small.
Good place to stop if you're passing through to Baker City :)
NYC is still NYC for example. It will suffer for awhile but people will continue to want to be there because being there is different than anywhere else. It doesn’t rely on an industry or on locality of an industry. It will rise as it has many times before as a capital city of the world. The surrounding suburbs in NJ and CN are well served by trains which the Bay Area can’t really say.
The Bay Area is just another sprawl of highways, strip malls, and parking lots. You could be anywhere if it did t happen to be there.
I think there will remain a certain prestige in the Bay Area though. But maybe not a monopoly like today. Sort of like how Wall St. is more a legacy than an actual locality that matters in the finance world.
Except when the annual wildfires make the air unbreathable for days or weeks at a time.
There's a large swath of people who want to work in an office for many different reasons. I don't think it's going away.
I love to see my colleagues face to face but I also hate the commute time to the core.
I think there are many people who are in the same shoe as I am.
If the COVID situation brings the whole corporate world to accept a level of flexibility, where proximity to the team is encouraged but not necessary, that would be a win for everyone, IMO.
Once its safe, you can be sure I'll be going into the office every day getting IRL "facetime" with managers.
Personally I don't see what's wrong with liberalism. What is wrong in the US is that the left prefer narratives over facts and data, and think that censorship would never one day hurt themselves.
Californians moving to Texas make it blue-er and themselves red-er. Who knows how this effects the electoral calculus into the future.
Not if people are just sitting in their home all day. They won't be influenced by their environment but will still vote the same. Dockerized voters.
That depends on the Californian. I don’t think Larry Ellison or Elon Musk moving to Texas make Texas bluer. It might make them redder though. Californians on average may be bluer than Texans, but the migration is a randomized sample of Californians.
Of course that would require the Republicans to get out of their own way and stop playing into the Democrats' hand at every turn regarding Identity Politics. So who knows.
This was the RNC's prediction and former goal for future growth. It was correct until Trump disrupted it. The only place where this is still true is in FL.
Until Trump loses his grip on the Republican party, Hispanics by and large will be flocking to the Democrats.
Trump was a huge driver of turnout. I don't think the republican party is quite as strong without him on the ticket.
Neither are the Democrats without a clear enemy. Many left-leaning people voted Biden as an anti-Trump vote.
One thing I'm not holding my breath for in 2022 is seeing the Democrats in the House leverage their decreased majority into a larger majority, or even retaining the House considering mid-terms are always a bad time to be a member of the President's party. That, and after this past election there is a net increase in the number Republican trifecta States, an increase in the number of States under Republican Governors, and redistricting season will soon begin.
Who set a record for votes. He wasn't unpopular, he was the 2nd most popular candidate ever.
People like to undersell how well the democrats did in 2018 and in 2020. Georgia going blue, Arizona going blue, and the blue wall getting rebuilt...it's pretty impressive. They kept the house, and may yet still win the senate.
The districts are already stacked against democrats as is. Republicans won't gain much from redistricting.
You have a point, but let me ask you: if a bag of rice had been the Republican Presidential incumbent in place of Donald J. Trump, do you think Biden would have received a record-setting number of votes?
Maybe I'm wrong about this, but it seems to me Trump's unpopularity was as much a factor in Biden winning as anything else that, and maybe that's because I live in a blue bubble, but even conservative outlets I followed were expecting the Republicans to be absolutely crushed this election and to go down in flames with the President, and they weren't. Not even close. Republicans didn't regain the House, but they saw net gains, and they retained a full 50% of the Senate. Harris's vote is only relevant if the Democrats can win in the Georgia runoff on January 6th, not just one, but both seats, otherwise she's just another President of the Senate without a vote. Considering that election is still an open question, it is a bit early to be calling Georgia a blue state. Elections are more than just the President after all, and Red and Blue States are only really Red and Blue after they've demonstrated a continuous unbroken Red or Blue streak for a few cycles.
So again, if the Republican Presidential incumbent was a bag of rice, would we have 1. seen record-breaking turnout in favor of both candidates and 2. a loss by the incumbent? I ask, and maybe this is just because I live in a blue bubble inside a blue bubble, because it seems to me much of the public turned out to register a vote of no confidence in the President more than they turned out to vote specifically for Biden. I wouldn't say most of Biden's votes were this, but enough to swing the election in a few key States? I think that's plausible.
I'd say the republicans were beaten pretty badly. I think they are at their worst point in decades. They managed to get their largest turnout ever, and didn't even flip the house. States that were red for decades flipped blue. And if the two runoffs are losses, that is a devastating blow, losing all levels of the federal government. 50% is not 50% without the white house.
I don't think the memory of Trump will go away that quickly. This election mobilized a lot of young voters, and now that they've seen their vote got rid of him, they will be more motivated to vote again for more progressive agendas, or against more radical right wing ones.
I don't think the rural republicans (Which is really where trump got most of his boost, anyway), will come out the same for a Mitt Romney. They want the guy who isn't afraid to tell it "like it is", be anti-BLM, etc. That is a major rift in the republican party that will further impact who they put up as candidates - and more rejection from the suburbs and cities will come.
Nah mate, I don't think so. 2008 was worse by far, I think you're reaching a little too hard for that one. If the Democrats had expanded their lead in the House, taken 60 Senate seats and expanded their hold on Governor's mansions, then this would be close to 2008, but even in that case Obama's margin of victory over McCain in both the Electoral College and the popular vote was a fair bit higher.
Yeah, the Republicans had their best turnout ever, but so did the Democrats! This was a record-turnout election all around. Turnout was so high that just a little less enthusiasm on one side or a little more animosity or apathy towards another side was enough to flip it around.
The only election in which the Republican Party was "destroyed" was the contest for the White House, and they saw some net losses in the Senate but not by anywhere close to the margin anyone thought. They actually gained in the House. 2008 this was not, not even close. Turnout was a lot higher, but the outcome is very different.
https://www.texastribune.org/2020/11/13/texas-redistricting-...
The chart shows the House popular vote compared to the number of House seats. When Biden entered Congress, Democrats were winning 10 percentage points more of House seats than their share of the popular vote. But those districts were extremely sensitive to fluctuations and after redistricting based on the 1990 census many flipped rapidly.
The strength of each faction waxes and wanes depending on what’s dividing the electorate. During the mid-20th century, both parties embraced “Christian values” (https://content.gallup.com/origin/gallupinc/GallupSpaces/Pro...) so economic issues dominated. Since Clinton, the parties are generally both on board with neo-liberalism, so religious and social issues dominate.
Maybe I just miss this, but that doesn't seem to match up with current evangelical support of the Republican party.
There is no stopping Texas turning into a blue (Democrat) state. The demographic changes in the US guarantee that outcome under all scenarios, short of the Republican party rapidly becoming a split Hispanic party. It's the only sustainable path forward for that party, so we'll see if they adjust accordingly or increasingly weaken. The future of the US is Hispanic / Latin American, so either the Republicans will adapt or they'll lose the popular vote by ever greater margins.
Shouldn't the democrats in california worry also? If so many democrats are moving to texas?
Oddly enough, just a few decades ago, texas used to be a democrat state and california was a republican state.
Lyndon B Johnson was a democrat from Texas and Richard Nixon was a republican from california.
I wonder if texas and california might flip in my lifetime. That would be so strange to see.
Austin is huge and there is no shortage of land and no pesky regulations (or at least less of them) that it can continue to support the influx for quite a while now. I don't expect it to be the next SV until we see a few Austin-incubated startups really make it big and hopefully kickstart its own substantial startup ecosystem.
https://i.imgur.com/OTFSSFF.png
https://www.historylink.org/File/1287
Tech business will be persistently pulled out of the Bay Area and into other states, Europe is about to see a large tech boom (courtesy of US venture capital) that will considerably harm the dominance that Silicon Valley has enjoyed the past several decades, combined with China continuing to make inroads in most aspects of tech. It's all pointing south for Silicon Valley, it's going to be a very ugly decade there.
We'd sooner install our own state digital currency before allowing dollar billionaires to bully us.
Some of the people who are just sitting in those companies collecting a paycheck have to make a choice now. They either leave the state or leave the company.
The good ones are likely to leave the company rather than move. That's going to be helpful to Silicon Valley as it's going to unlock a bunch of brainpower that was sitting mostly idle.
Petition your state to change laws nullifying non-compete clauses
In general, I am skeptical that the pandemic will cause permanent changes, except insofar as it speeds up things that were happening anyway. But, in regards to an exodus from the very-highest-priced places to live, towards places where things are merely expensive, I wonder if this is going to be a lasting change. I had been seeing "SV/NYC is so expensive it's crazy, businesses will all leave if something doesn't get done" for so many years, I had more of less stopped waiting for it to actually occur. But this year, I wonder...
Wonder if all of this is related.
Travis county’s economy will probably be OK, but they’ll soon regularly have “high wet bulb temperature” days where going outside will kill you.
Also, their agricultural yields are projected to drop 67%, so any vegetation in the parks, etc will probably die off.
https://projects.propublica.org/climate-migration/
(Type “travis county, tx” in the search bar toward the middle to see the projections.)
That being said it is common advice to avoid 35 at all costs. It is always terrible as it only has 3 lanes through the core urban area.
As for urban driving, I think SF is easier because of its grid system but I usually take a Lyft so can’t really say.
> The filing of such cases in the Eastern District of Texas dropped after the 2017 Supreme Court decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, which held that for the purpose of venue in patent infringement suits, a domestic corporation "resides" only in its state of incorporation. Meanwhile, the filing of such cases in the United States District Court for the District of Delaware increased.
Plus you consider where the world is going in terms of reversing global warming (ie, not very well), LA, SF, NYC will be under water due to the rise in sea level. Planning long term stays in these low lying areas is simply not smart, unless you don't plan to stay in business past 2050.
What's the next hip town?
California -> Austin
I think you could probably chalk a lot of this up to where company leadership has their vacation homes.
1. No state income tax.
2. Comparatively cheaper home prices, though with news link this perhaps not for long, centrally located Austin single family homes are incredibly expensive now.
3. Vibrant tech and VC community - not at the same level as SV but a not-too-distant second-or-third.
This Bloomberg article had a chart showing change in adjusted gross income from 2017 to 2018, but I'd be interested in something going back a few decades.
https://www.bloomberg.com/news/articles/2020-12-05/even-befo...
https://assets.bwbx.io/images/users/iqjWHBFdfxIU/iPUtINXvmFd...
Uh, no.
Austin has a lousy VC community. There are countless articles about it.
And, as for tech, for software it's mainly only Tivoli alums--and a lot of the best ones decamped for greener (read: better salary not in Austin) pastures. IBM as a technical presence has been gone forever (the Advanced Workstation Division was quite amazing and IBM Somerset was one of the PowerPC development arenas). Apple just came in so hasn't spun anybody out yet.
The idea that location matters is so last 20 years.
It's always dynamic. Being near some success is good for artists and creators because they can tap into the revenue stream without being priced out. Too few customers and the density of innovation can't exist. Too much success and only the most successful and profitable ventures can survive.
I personally like the heat (over the cold). I mountain bike with my kids at dawn in summer. We camp in Flagstaff which is 30-40 deg cooler (7500ft elevation) and only 2 hours away.
Of course, California is also by far the largest destination of people who move out of Arizona. They are adjacent states after all and Phoenix is, let's face it, basically in Los Angeles already.
https://www2.census.gov/programs-surveys/demo/tables/geograp... [an XLS file]
https://www.texastribune.org/2020/09/22/tiktok-texas-trump/
President Donald Trump said Saturday that he tentatively approved a deal between the Chinese-owned social media app TikTok and Oracle and Walmart that could bring the new joint venture’s headquarters to Texas. The deal, though, still faces much uncertainty.
“All of the technology will be maintained here,” Trump said at a North Carolina rally. “They’re going to move probably to the great state of Texas.”
...
If approved, the new entity, TikTok Global, would contribute $5 billion to an educational fund based in Texas, according to the Austin American-Statesman, though Walmart said in a press release the money would go to the U.S. Department of the Treasury. Trump had previously requested that there be a contribution to the U.S. government in exchange for helping to arrange the deal. Walmart did not respond to a request for comment.
For the sake of their many stakeholders, I hope the CEOs are not overreacting to the reactionary idea bubble - that they are not taking too seriously what is political rhetoric - or acting for political purposes. Many people do not share their political views.
It also matches the corporate outrage / take-my-ball-and-go strategy: If someone dares to regulate or tax a company - the outrage! - they say they are leaving. Think of Amazon in France and other places (IIRC Philadelphia passed a law requiring businesses to take cash and Amazon threatened to leave, then backed down). Think of Uber and Lyft in California. It's childish and I think if someone called them on it, it would be revealed for what it is. It's not clear to me how it's good for society that they don't have to contribute and pay their share.
Finally, where will these companies recruit from? The University of Texas is pretty good, but not close to the level of Berkley and Stanford, two of the top ~6 schools in the world. Also, many more people want to live in the Bay Area than Austin in general, and IT professionals want to be in SV where the center of their industry is. Austin is nice but simply is not real competition.
California and NYC were great great states, and after decades of democrat governments, companies decide to move thousands of kilometers so they can leave these states in favor of Republican states.
There's so many of individual decisions along these lines.
YEt, I am not aware of anyone leaving a red state to live under the woke shackles.
Go read that study by the government on internal US migration.
These “shackles” you’re talking about took me from someone who used to live in a ghetto to someone in the top 1%. The taxes are a small price to pay. Obsessing over marginal income tax rates is the wrong variable to optimize in life.
Do what you love, where you love, because it’s your passion, not because you can shave 3% off of your effective tax.
Most entrepreneurs don’t obsess over taxes, they’re focused on growth and solving problems, profit comes later.
The constant hyper focus on marginal tax rates is a form of bean counter myopia. It’s what you do when your company is effectively in maintenance mode and beholden to the bean counters on Wall Street, not when your trying to win your market space.
Wake me when Apple decides To move its HQ to a red state.
SpaceX and Tesla leaving CA are bigger loses, but they haven't left yet, and it's unclear he'll move them, other than opening up more plants elsewhere. Boca Chica/Austin might eventually become the new locus of new hiring for example, but the Dragon/Falcon business might remain in CA for example.
HP leaving is basically a zombie company leaving on life support, it would be like IBM or Kodak leaving.
The real power of the Bay Area is the startup economy, and I think it will be hard to dislodge that, just like it's hard to dislodge Shenzhen, because of the "nexus" effect, or chicken and egg as you mentioned. If all of your customers and workers, and supply chain, and investors are in one spot, as an entrepreneur, you're going to gravitate there, even if the costs are high.
I mean, you get can Silicon Hills, and Silicon Alleys elsewhere, but I don't think they'll overtake the Bay Area.
However, I could see Texas, Arizona, Nevada, becoming the "Mars Plateau" in the future. Realistically, Musk needs a coastal port for logistics, ability to mine resources, and a state that would be complicit in dealing with angry laborers or neighbors who don't like Sonic Booms going off all the time.
CA's just not going to let him run as roughshod as he wants, e.g. the worker safety and labor issues at his plants, the environmental impacts of what he's doing in Boca Chica, etc. That slows down his time schedule a lot, I don't blame him, he wants to get to Mars quick, but then again, if I were living near a Starship test area, I'd also be annoyed by all of the traffic, tourists, and explosions, so I don't object to him trying to get as far away from regulated residential areas as possible.
Same basic story if you break it down by income levels.
Why is this? There are large classes of people who can't stand to live in the MAGAsphere, and I mean huge classes of people like females, people of color, homosexuals, and non-christians. Whenever these people scrape together enough money to do so, they escape to a jurisdiction that recognizes their personhood, whether that be New York, California, or Austin.
University graduates and skilled workers?
No one is leaving Democratic states to go to some hell-hole Republican area. They are leaving Democrat cities to live in OTHER Democrat cities, the only difference between cost of living. That's it, simple as that. It has nothing to do with "wokeness" etc. It's basically, Austin cheap, San Fran expensive.
Tons of people are moving to Arizona and Texas from the Midwest and California. Now these states are turning blue, but the policies that made them attractive to those people (less regulation, resulting in more housing built and more jobs) are definitely not “democrat” policies.
June. 92° / 72°
July. 96° / 74°
August 96° / 74°
Average high/low temperatures in the summer for Cupertino are:
June. 75° / 55°
July. 76° / 58°
August 76° / 58°
Austin will never, ever be like Silicon Valley because of this. The freedom you get from cooler weather is great from an energy utilization stand point and for allowing safer and more desirable conditions outdoors. Not to mention you have much more beautiful choices of nature in Northern California. Think about whenever you travel to Austin for conferences, it's oppressively hot and you basically travel from one air conditioned building to the next. Now imagine 10 years time of increased global warming. California will still be coastal to one of the coldest waters in the world at this latitude, which is a natural air conditioner. To me this spells the end of Oracle's supremacy in anything other than selling smaller and smaller volumes of mainframes. They've started focusing further and further on cost reduction.
Edit: For those downvoting me, Texas is a wasteland of has-been tech companies that couldn't cut it when in competition with the west coast and the rest of the world. Oracle isn't going to change that.