A Company Town

The headquarters of Adobe Systems in downtown San Jose, CA.

Many people live in company towns - a term which originally meant a town literally built by one company (such as Hershey, PA), but which more commonly now defines a place where one major company or industry dominates the entire economy and culture - their entire lives.

Google's headquarters in Mountain View, CA.

Detroit (Automobiles), Seattle (Boeing, Microsoft), Orlando (Disney), Napa/Sonoma (Wine/Tourism), Hartford (Insurance), Las Vegas (Gambling/Tourism), Washington, D.C. (Government) all immediately come to mind as large company towns in the U.S.

When I grew up in San Jose, CA in the 1960's and 1970's, it was not a company town.  Even if you tried to make the argument that it was; that single industry would have been agriculture.  I remember fields and orchards sprinkled throughout the valley, and vineyards covering the hillsides.  Somewhere in the last thirty years it definitely has become a company town for High Technology: the Capitol of Silicon Valley. 

The riverside headquarters of Cisco Systems in San Jose, CA.

I often ride my bike along the Guadalupe River Trail in San Jose.  The Trail presents a backyard tour of many of the High Tech companies that now dominate the economy of Santa Clara County.

The headquarters of Cisco Systems (above right) is one of those many High Tech companies that line the Guadalupe River & Trail.

Driving or biking around San Jose and Santa Clara County today, you regularly spot headquarters and campuses of some of the most recognizable names in software, computing and the internet: Adobe, Cisco, eBay, Google, Intel, Netflix, Oracle and PayPal .

The eBay campus in San Jose, CA.

(The San Jose headquarters (LEFT) of eBay, the world famous online auction web site, that has annual revenues of nearly 10 billion dollars a year.)

I lived in a Northern Virginia suburb of Washington, D.C. on and off in the 1970's, but I was too young to recognize it for the company town that it was and is, or even to realize what it meant.

I lived in Los Angeles in the 1980's, and while it's certainly a company town for the entertainment industry in terms of culture and visibility, its economy is actually more diverse than you might think.  There are seven Fortune 500 companies headquartered in Los Angeles, and not one of them is connected to the entertainment industry.

The first time I saw firsthand what it was like to reside in a company town was when I first started working for US Air in the late 1980's, and lived in Aliquippa, PA, just outside Pittsburgh.  US Air's headquarters weren't actually located in Pittsburgh, contrary to what many people seemed to believe (they were in Crystal City, Virginia), but Pittsburgh was then their largest hub, and the location where they employed the most people.  US Air dominated the air traffic, for better or worse, at the Greater Pittsburgh International Airport, and seemed to dominate the city as well.  Everyone in Pittsburgh seemed to work for US Air, or be related to a US Air employee.  Many businesses offered discounts for US Air employees.  Local bars had "US Air" nights.

U.S. Airways pilots in the Pittsburgh airport.

The media in Pittsburgh covered US Air with a laser focus unseen in any other city.  If a flight was diverted for some mundane reason, a routine occurrence in the airline industry, or any other news, no matter how trivial, was available about US Air, it usually was on page one in the morning papers, and led the evening newscasts.

Apple, Inc. headquarters in Cupertino, CA.

Pittsburgh had long been a company town for the U.S. Steel industry.  I met several people there whose father worked in the mills, and THEIR father and so on and so on.  Hell, even MY grandfather worked in a steel mill in Pittsburgh.

And with that history came what outsiders called a"Steel Mill" mentality: this company or industry is too dominate or large to ever disappear, and I'm always going to have a job here.  An attitude that I'm sure once prevailed in other large company towns (think Detroit).

As an outsider, I could read the tea leaves in the airline industry and felt Pittsburgh was eventually going to be  a victim of poor US Air management, economics and airline consolidation.

Pittsburghers and the local media would complain about US Air's monopoly in Pittsburgh - Pittsburgh was what's known in the airline industry as a "fortress" hub, meaning one airline had such a high percentage of flights that it scared away competitors -  and the high fares that fortress hubs inevitably invite.  A valid complaint.

I would remind those who complained about US Air's monopoly in Pittsburgh that a city with a population under 400,000 people, and a declining economy, wouldn't have non-stop flights to London and Frankfurt, and multiple flights a day to such destinations as Seattle, San Francisco, and Los Angeles, were it not for US Air's hub in Pittsburgh.

Then I would assure them they weren't going to have their US Air monopoly problems for very long.  I felt the hub couldn't sustain itself, and would be gone within a few years.  Everyone from Pittsburgh just laughed and shook their heads at my predictions.  Steel Mill mentality.  US Air will always be big in Pittsburgh.  Unfortunately,  I was right.

The world's largest semiconductor chipmaker, Intel, is based in Santa Clara, CA.

When I returned to San Jose two years ago after a thirty year absence, it started to dawn on me that something was very different from the San Jose of my youth.  The vineyards and orchards had vanished, skyrocketing housing costs were among the highest in the nation and the population had doubled; sure, that was all immediately evident and all true.  But what I realized was that San Jose, and the surrounding suburbs of the South Bay that make up Santa Clara County, was now a COMPANY TOWN.

The economy, the culture, the politics, the residents were now completely dominated by the High Tech industry.  It's much easier to understand how and why things work and operate here in San Jose, if you understand that it's a company town, which it never was in my youth.

And once you reach that conclusion, the question arises if it's ultimately good for one area to be dominated by one company or industry.  Can a company town stay hungry?  Can it survive through the changes and turbulence in that industry?  Can it continue to innovate and grow, or does it inevitably develop that "Steel Mill" mentality?  

I'll let you know.  Right now, I'm still reading the tea leaves.  And there's no app for that.