Apple Looks Beyond Silicon Valley to Improve Recruitment and Retention

[MacRumors]

Apple is "ramping up efforts to decentralize out of Silicon Valley," following difficulties recruiting and retaining talent at its Apple Park headquarters in California, according to Bloomberg journalist Mark Gurman.

In the second edition of his new Power On newsletter for Bloomberg, Gurman suggests that Apple is prepared to jettison its tradition of attracting technologists to Cupertino in favor of opening offices in places where operation costs are less high and living costs aren't as prohibitive for its employees.

The company is said to be "losing talent" because employees are struggling to afford the high cost of living in the San Francisco Bay Area, despite being high earners by most standards. Anecdotally, many engineers who have spoken to Gurman have complained that they've been unable to balance living expenses with things like college tuition for their children and long-term savings.

At the same time, under the pressure of being the world's most valuable company, Apple is said to have realized that "it can no longer wait for the best designers and engineers to gravitate toward its spaceship," and must instead go to where those people already live, which would also make building a diverse workforce less difficult.

From Gurman's newsletter:

Some members of Apple's executive team had been pushing to decentralize out of Cupertino for years before a fuller realization came into place more recently. Johny Srouji, Apple's head of custom silicon, was one of the strongest proponents of such a shift, I'm told. His group opened up offices in Florida, Massachusetts, Texas, Israel and parts of Asia years ago. It has since expanded in Germany, Oregon and San Diego.

Eddy Cue, Apple's online services chief, has also pushed for decentralization, investing in multiple Los Angeles offices and a location in Nashville. The chief operating officer, Jeff Williams, has internally discussed the cost benefits of a more global workforce, and Deirdre O'Brien, the retail and HR chief, has evangelized for the diversity benefits.

Decentralization across the company is entering full swing, and Apple has engaged in a costly expansion from the sunny coasts of LA and San Diego to the Pacific Northwest of Oregon and Washington, the Rocky Mountains of Colorado, Iowa's Midwest, the Eastern Seaboard of Massachusetts, Miami and New York.

The plans come as Apple prepares to pilot a hybrid work model for its global retail employees that would sometimes allow them to work from home. The move also follows recent reports of corporate staff voicing their displeasure about the company's plan to return to three days of in-person work a week starting in September.

Article Link: Apple Looks Beyond Silicon Valley to Improve Recruitment and Retention

 

[Apple_Robert]

Maybe Apple is working on building multiple spaceships that can transport people from home to the mothership in San Fran.

 

[GadgetBen]

Tim: "Turn on the tractor beam"

 

[no_idea]

Will be interesting to see what the long term affects of the Bay Area housing price comes to. My guess if more companies push for this, you will see a substantial drop in housing prices…simple supply/demand at work

 

[Mcckoe]

Right after Tim Cook’s takeover, Apple eliminated the majority of their remote contracted employees. This included a lot of people that worked for Apple; whom didn’t live in specific California areas. Upper management claimed this was to decrease security leaks, but it was basically used to get rid of speciality projects that didn’t fit with the narrative of new management. Apple lost a lot of talent: when they basically asked said, “move to the valley, and take a job here; or find employment elsewhere“. Interesting to see them come full circle; as the cost of living and established lives, were a common reason used back then. Apple lost some very talented people because of those choices, shame this took them so long to realize.

 

[Blackstick]

It’s not surprising. You need an Apple executive’s salary to afford anything close to nice in the Bay Area.

 

[contacos]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

 

[Doomtomb]

Doesnt matter how much you pay if housing costs get too high. Ruins the ecosystem for everyone else too.

 

[Rogifan]

I don’t think Eddy Cue is a good example. It‘s not surprising that Apple Music and Apple TV talent are located outside of Silicon Valley. I would expect people running TV+ or to be located in LA. Nashville staff is probably for Apple Music. Is LA really that much cheaper than the Bay Area? I thought Apple already had offices in Seattle. In 2018 there were stories about Apple expanding in Pennsylvania. Back in April Apple announced they were building a campus in North Carolina. This seems like Gurman thinking he’s got some juicy story here when actually it’s what Apple’s been doing for years now.

 

[Danoc]

Soon: "iPhone. Designed in Texas. Made in Vietnam."

 

[crsh1976]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

That would have been a good idea about 15 years ago, too late for that now unless you want to trigger the mother of all sh*tstorms - so many have been filling their pockets with this overevaluated cost of living.

 

[ghanwani]

There was a time when small towns were built around large companies. Then came the era where companies stopped investing in R&D and instead grew by acquisition and so they shut down those locations and consolidated where the startups were. This has created the mess that Silicon Valley has become. You have to be a Type A personality to want to live there.

 

[Shirasaki]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

Such will NEVER happen in a free country that is USA.

 

[no_idea]

That would have been a good idea about 15 years ago, too late for that now unless you want to trigger the mother of all sh*tstorms - so many have been filling their pockets with this overevaluated cost of living.

To accomplish that, you’d have to go upstream as well and cap the raw suppliers on how much it costs them to deliver a 2x4 to the Bay Area, as well as real estate agents for premium listings. It’s all a hot jumbled mess

 

[Shirasaki]

I thought being able to work in Apple would always be the biggest attraction to any talented individual, and they’d bend in order to work for Apple.

 

[nexusrule]

I thought being able to work in Apple would always be the biggest attraction to any talented individual, and they’d bend in order to work for Apple.

Talented people started to realize you don’t really need to work for the more demanding companies, that asks for extra-long shifts and weekend work to meet deadlines, when you can make more or less the same amount of money, solve interesting problem and still have a life in several less “glamorous” but still big and innovative tech companies.

 

[no_idea]

I thought being able to work in Apple would always be the biggest attraction to any talented individual, and they’d bend in order to work for Apple.

Maybe for the first 6 months or so…but then once you see your friends in other areas living a much easier life even though u know u are paid more than them will get you starting to reevaluate your decision.

 

[ghanwani]

Talented people started to realize you don’t really need to work for the more demanding companies, that asks for extra-long shifts and weekend work to meet deadlines, when you can make more or less the same amount of money, solve interesting problem and still have a life in several less “glamorous” but still big and innovative tech companies.

Actually the bulk of talent has mostly gravitated towards the FANGMAN companies. It's either that or startups. There is very little talent to be found elsewhere because, aside from exec-level jobs, it is hard to make money anywhere else. Those at startups are betting on a successful exit otherwise they stay poor.

 

[TheYayAreaLiving 🎗️]

San Fran is just too expensive and the salary isn't just cutting it there.

 

[Bobby Smallwood]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

Market forces will solve the issue, you will see more and more companies making satellite operations and working from home. I think certain regulation can work like controlling rent increase and certain restrictions on speculation buying. Not sure how the Market is in SF but in many Canadian Markets where I am there are many empty condos owned by foreigners. To address this certain jurisdictions have introduced taxes on these properties that are vacant and foreign owned and also a 15% tax on the purchase if you are not a citizen or resident.

 

[5232152]

What are they doing abroad? Their tax-evasion haven in Ireland is hardly a hub for development and R&D? Singapore? Japan? Seems like thinking within the US is going to fall short if they are looking to ramp up talent.

 

[centauratlas]

To accomplish that, you’d have to go upstream as well and cap the raw suppliers on how much it costs them to deliver a 2x4 to the Bay Area, as well as real estate agents for premium listings. It’s all a hot jumbled mess

And you'd have to stop people from being allowed to sell their own property.

Capping rents sounds like a good idea if you don't like living in a free country.

 

[ducknalddon]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

That wouldn't create any new housing which is the real problem. In fact it may make the situation worse as there would be less incentive for landlords to invest.

Fundamentally it's a problem of too many people chasing too few houses. You can either expand the number of properties or decrease the number of people. You can't have your cake and eat it.

 

[jjudson]

My experience working in Silicon Valley has taught me that the entire area needs to be closed, leveled, and converted to a parking lot or better yet, a wilderness. There is nothing more bizarre than living and working in that environment. Enormous amounts of money are spent on the most amazingly wasteful and non-business-related baubles, while employees are unable to keep up with the extravagant living expenses to reside near their jobs. Homelessness is out of control there, as is congestion and environmental damage. This is all not to even mention the destruction that much of Silicon Valley imposes on our culture and society by their manipulation and control through the social media platforms they own.

Apple would do well to move out, and many others would do well to shutter themselves and embark on a self-assessment on a mountaintop somewhere.

 

[GeoStructural]

I am surprised there is no state wide limitation or cap on how much you can charge per m2 for rent. That would solve the problem a little

If the city of Cupertino was smart they would control housing prices and prevent loosing tax-paying residents and a huge employer like is Apple.