There's no doubt Silicon Valley is on the leading edge of high-tech and information technology, but there's a crumbling edge to our infrastructure, particularly when it comes to transportation and housing. That's the consensus of Tapan Munroe, chief economist with Pacific Gas & Electric Co., and Los Altos Chamber of Commerce President Phyllis Carmichael, with Seville Properties of Los Altos.
Munroe shared his advice on "Prospering in the New Economy" Jan. 30 at the CEO Global Breakfast Series sponsored by the Silicon Valley Defense/Space Consortium.
"We're on the leading edge of the world economy in high-tech," Munroe said in a Town Crier interview. "We have eight or nine key firms in 21st Century technology (in the Silicon Valley). The challenges are traffic, the shortages in skilled workforce, affordable housing and air quality. We need better airport access and more light rail."
"We need much better infrastructure to allow people to get around without needing a car," Carmichael said. "BART expansion is necessary."
When she attends Realtors' conventions, Carmichael said, people are surprised at the lack of light rail access between San Francisco and the Silicon Valley.
While quality-of-life issues such as transportation and housing availability won't affect employee recruitment in the next year or two, Munroe said they "could become a factor in five years." When it comes to planning, he said, "time is of the essence."
Both Munroe and Carmichael see telecommuting as one solution to Silicon Valley traffic congestion. They also agree that there are barriers to its use, including the fact that it can be lonely at home without face-to-face interaction.
"Telecommuting is growing; it should grow faster," Munroe said. "There is the cultural issue that (employers) like to see people in the office working."
Carmichael sees more people who are able to work several days a week at home, thanks to computers.
"I see the possibility for blending work at home with appropriate time in the office," Munroe said.
Munroe is an active booster of small business. He has led strategic economic summits in several local counties that have led to the development of county small business incubator programs.
Munroe's figures show a steady increase in new business incorporations in Santa Clara County from just above 2,000 in 1992 to 3,500 estimated for 1997.
"Silicon Valley is fueling the strong national economy," Munroe said.
His figures show that Silicon Valley export sales represented 40 percent of California's export sales in 1996, up from a 28 percent contribution in 1991.
Munroe has some concerns, however. One is that all people in the Valley are not sharing in the area's economic growth.
A second concern is that current problems in the Asian market have meant reduced exports for Silicon Valley firms.
However, those same problems have lowered the cost of imports to the United States, keeping interest rates low.
"That allows the economy to continue to grow," Munroe said.