San Diego has been one of the world’s leading cities for entrepreneurship and innovation for the last decade. Year after year we are recognized as filing tons of patents and starting up lots of new companies – surely exciting times. I’d like to take a close look at some trends and how they will impact the future of Technology driven careers.
A recent article in the SD Tribune provided some specifics as to what is happening in the last 12 months. Notable statistics reported here state:
477 Startups in the last year – up from 405 the year before
- Software is the leading vertical with 280 new firms
- Biotech second with 95
- Computer / Electronics 3rd with 63
- The next most relevant industries were Aerospace/Recreation/environmental technology
It is important to note, that most of these new businesses are technology focused and they will require workers with high skill sets to help their businesses grow.
Capital investment is also noted in this report, an obviously essential component to drive innovation and growth.
- 118 SD Startups raised a total of $1.5B in Venture Capital – Up from $1.2B the year before.
- Angel investors delivered $134M vs $74 the year before.
What is interesting is that while San Diego grows, the Bay Area is contracting a little. However, the level of investment up north is significantly greater overall. The following stats were taken from this report:
- Venture Capital Investments were only $6.7B in Q1 2017 vs $7.8B in Q1 2016
- 2016 was down compared to 2015
If you annualize this, there’s over $25B in new VC funding being injected into the Bay Area economy every year – still miles ahead of San Diego’s 1.5B.
Another interesting trend is technology companies are opening new offices and/relocating to San Diego with high velocity. We have already seen FitBit (100+ employees), Amazon (500 new employees) and GoPro (200+ employees) invest heavily into san Diego. Plus, there have been several companies that have picked up and moved to SD: ServiceNow (I know – started here), BizApp, WeWork, Houzz, AppFolio etc. This is what is driving this move:
- San Diego has a strong technology Talent Pool (Devlopers/CyberScurity/BigData/Robotics)
- Lower Cost of Living – 37% lower in SD
- Salaries are in SD are 28% Lower than SF/Bay Area
- Less Traffic
- Better Weather/Standard of Living
As we know, San Diego has an uneven income to cost of living ration – coming in at a -9% when comparted to the national average. Costs are outpacing income, so this is getting worse. I sat through an interesting presentation about tech-related salary expectations in San Diego. Feeling as though this is valuable, I’d like to share some of my notes.
The unemployment rate for technology jobs is only 2%, which is very good for the economy. However, this is a challenge for the hiring managers looking for talent. With a majority of the top talent already (happily) employed, the candidate pool is slim. Attracting and retaining does require better pay, perhaps this can create a rising tide to combat the salary to cost of living ratio.
My stats are collaborated from a recent Robert Half Report (US Stats +26% in SD, =40% SF, you can download it here:
CIO - $208K in SD and $231K in SF
IT Director - $156K in SD and $174K in SF
Network Architect - $173K in SD and $193K in SF
Developer/Analyst - $105K in SD and $118 in SF
Mobile App Dev - $139K in SD and $154K in SF
Big Data Engineer - $156 in SD and $175 in SF
Data Security Analyst - $148K in SD and $164 in SF
As technology evolves, the management of systems are becoming more complex. Cloud does not solve all problems by simply being “The Cloud,” there’s tremendous more responsibilities that need to be addresses such as: Management of multiple platforms, securing multiple platforms, integrating/unifying networks, compliance/regulation, automation etc. I’d like to point out a couple trends that I have seen evolve in the past couple years that are a direct result of this changing landscape.
Blended Jobs:
This is where an IT Operation may have a budgeting issue where they decide to go thin on administrators, or anyone with a specific role. In order to facilitate this, they change a role to be a blend of two positions. A great example of this is the trend of hiring DevOps managers to run an entire network. Although a DevOps professional is valuable to a dynamic dev/software team, asking them to manage a network is a tall task. In this case, I have seen consistently seen the DevOps people leave companies’ network completely exposed, with no security, patching, backups etc. This is an extreme example, but this is happening at a massive scale today. The average technology professional is spread thin, frustrated and exhausted because they are doing the jobs of 2-3 people.
Hiring Novices to do Important Jobs:
Face it, IT management (not to mention Hardware/Software/Cloud etc) is seen as a cost center to financial teams, they’d like it to be run thin and cheap – especially with the salaries outlined above. Today, there is a trend of top-tier talent being marginalized for younger, less experienced talent. Not that the younger generation doesn’t have a place in the industry, but experience will help cut down on vulnerabilities and costly mistakes. Plus, how will they learn without a mentor – trial and error?
“The Cloud” Solves all my Problems:
This is the most interesting trend; one that I see more frequently with tech startups. Of course, there is a time when a company must mature and embrace traditional best practices, but many wait a long time, focusing on getting their company into a stable financial situation. A majority of these startup software companies are born directly in the cloud (mostly AWS) and continue to keep their production environment running there as they grow. I am not sure if they believe that ‘The Cloud” is a turn-key administration machine, or they simply do not see it as a priority yet. I see most of these companies completely neglecting their systems maintenance. That means, no security, no patching, no backups, no documentation etc – a potentially huge risk or the company.
If there is anything to conclude here, it’s that San Diego will continue to drive innovation and create dynamic careers for technology/Science professionals. It also means technology talent will continue to be in high demand and the costs are going to continue to increase for companies to hire them. This is an evolution and certainly a good problem to have. If you look at San Diego just 20 years ago, almost none of this opportunity existed.
Mindcentric is a San Diego County based technology company that specializes in managing complex IT infrastructure for companies that embrace technology to grow their business. Since 1999, Mindcentric has excelled in partnering with companies to complement their internal IT Operations, delivering expert level engineering and management. We have helped many companies, in many verticals power their products such as: Medical Devices, BigData/Analytic Services, Software, Internet, and Financial.