Insider Finance - Business - Insider Today: Saving San Francisco

Scott McKenzie’s “San Francisco (Be Sure to Wear Flowers in Your Hair)” was a ballad for the exciting things occurring in the city when it was released in May 1967.

In reality, the song was produced by people from Los Angeles looking to promote a concert they were planning in the area. But that didn’t stop it from being a hit and serving as a defining song of the Summer of Love.

Nearly 60 years later, Elon Musk is also looking to woo young people to Northern California, albeit without a melody.

The billionaire tweeted on Monday that it’s "important for more people to come to work in San Francisco or the rest of the city can't survive."

Musk’s comments come just a day after he tweeted that he planned to keep the headquarters for the company formerly known as Twitter in San Francisco (plans he announced in spite of a sign drama that prompted London Breed, the city’s mayor, to say Musk couldn’t be “above the rules”).

The City by the Bay has had a tough go of it these past few years. Homelessness remains a major problem, and commercial real estate has taken a massive blow in the wake of the coronavirus pandemic. Even the city’s biggest mall can’t make ends meet.

But the biggest threat to the city is simply how expensive it’s become to live in. The median rent for a one-bedroom property in San Francisco is $3,000, according to Zillow, which is 84% higher than the national median.

And while that might seem like a drop in the bucket for senior tech employees, making that type of rent payment is no easy task for entry-level employees.

That’s why Alistair Barr, Insider’s global tech editor and a Bay Area resident for nearly two decades, believes the San Francisco ecosystem that’s been a breeding ground for countless tech companies is at risk.

For decades, new grads headed to the Bay Area in search of jobs at startups or in Big Tech with dreams of hitting it big. And while only a fraction of them would achieve massive success, those who did would typically stay in the area to seed the next generation with angel investments. And on it goes.

But with the cost of living so high in the region, Alistair said the cycle is at risk of being broken. 

Instead, less cost-prohibitive cities are becoming more attractive. Take Raleigh, North Carolina, which is part of the so-called Research Triangle. Tech giants like Google and Apple have come to the region, where the median rent for a one-bedroom property is $1,437.

Who wouldn’t take that deal? Let us know what you think.

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