The new 2007 Index of Silicon Valley is out. This year's effort by Doug Henton and the terrific team at Collaborative Economics is the best one yet. In addition to tracking trends in high-tech and venture investment, it includes a detailed section on Silicon Valley in a spiky world, with new data on the global distribution of patents, IT employment, and venture investments. This special section has a detailed analysis of talent and diversity which concludes that "Silicon Valley’s diverse ethnic composition will be its chief asset in the global marketplace, where new technology regions in Asia, Israel, and Europe are emerging as competitors and collaborators." The report includes a detailed analysis of the externalities of the creative economy, including worsening economic inequality and deepening problems of housing affordability, noting that: " the region faces significant challenges... the percentage of first-time home buyers who can afford the median-priced home is 26 percent, down from 31 percent in 2005."
The report concludes that Silicon Valley is: "growing as a global center for creativity in business and technology, defining our advantage by being creators of new products, services, companies and business models. This is a fundamental restructuring, away from the old manufacturing model toward a new idea economy. We can see it happening very clearly, and our region’s companies are taking full advantage. The question for Silicon Valley is whether there will be broad participation in these activities—particularly for the rising generation—or whether we’re looking at a future where our companies prosper through their global networks but the region doesn’t feel better off.”
The full report is here.