The Bay Area economy has almost doubled since the “dot-com” bust in 2001.
The Bay Area’s $1.2 trillion economy has fared well in the first two decades of the 21st century. Notwithstanding three significant recessions (the “dot-com” bust in 2001-2002, the great recession in 2007-2009, and the COVID-19 recession in 2020) the region’s inflation-adjusted economic output nearly doubled between 2001 and 2020. While a growing population explains some of this growth, the region’s economy has still grown by almost 75% since 2001 when evaluated on a per capita basis. Since 2009, the region has added $480 billion to its GRP, an average of nearly 6.5% growth each year.
In 2020 amidst the COVID-19 pandemic, GRP essentially remained flat over the previous year. The future shape of the growth line in the post-COVID-19 environment remains to be seen.
The inflation-adjusted economic output of the San Francisco Bay Area grew by 98% between 2001 and 2020
Historical Trend for Economic Activity
All Bay Area sub-regions have seen positive trends for economic output, but Silicon Valley is powering the region’s economic surge.
Riding a technology boom, the per capita economic output of Silicon Valley nearly tripled between 2001 and 2020, growing over twice as fast as the regional growth rate after adjusting for inflation. While the San Francisco-Oakland-Berkeley subregion still accounts for about 57% of the Bay Area economy, San Jose and other Silicon Valley cities contribute nearly 37% to the region’s economic output.
In the North Bay, Napa, Solano and Sonoma counties account for the remaining 6% of the Bay Area’s overall economic output. However, on a per capita basis, Napa and Solano counties have experienced economic growth at a rate only slightly lower than that of San Francisco since 2001. Sonoma County has the smallest long-term growth in per capita GRP since 2001 at 20%, due in part to a concentration of jobs in lower-economic value sectors like agriculture.
Sonoma County's inflation-adjusted per-capita economic output grew by 20% between 2001 and 2020
The inflation-adjusted economic output of Silicon Valley grew by 200% between 2001 and 2020
Regional Breakdown of Economic Output
When it comes to economic output, the Bay Area is growing at a faster rate relative to other large metro areas.
The Bay Area’s economy has been one of the nation’s best performers since 2001, with over 75% per capita growth in GRP, outpacing other major metro areas by a wide margin. Since 2001, the Bay Area per capita GRP has led all other regions—outperforming the nation's energy, political and financial hubs (Houston, Washington D.C. and New York, respectively) by nearly $66,000 per person.
During the COVID-19 pandemic, GRP decreased for many major US metros. One notable exception would be the Bay Area, where GRP essentially remained the same between 2019 and 2020. The future shape of the metro growth lines remains to be seen. This is especially true coming out of the COVID-19 pandemic, as we see different regions adjust to post-COVID-19 conditions in different ways.
In 2020, the Bay Area’s per capita gross regional product was 1.8x greater than that of the New York City metro area
Metro Comparison for Economic Output
Sources & Methodology
Data is inflation-adjusted by using both nominal and real data developed by Bureau of Economic Analysis (BEA) and appropriately escalating real GRP data in 2012 chained dollars to 2020 dollars using metropolitan statistical area (MSA)-specific Consumer Price Index data from Bureau of Labor Statistics. Economic output per capita is calculated using CA Department of Finance historical population estimates and Census historical population estimates for Metro areas.