High-technology agglomeration and the labor market: the case of Silicon Valley

In this paper the pattern of labor-market activity associated with major high-technology agglomerations within the USA are examined, drawing upon the results of a mailed questionnaire survey of firms in the semiconductor industry. The analysis is focused upon the cluster of specialized semiconductor firms in Silicon Valley, to determine the contribution of local labor-market processes to the growth and development of this high-technology production complex. Fluid employment relations and efficiencies in search and mobility within the local labor market provide Silicon Valley firms remarkable flexibility in meeting their labor demands and help to ensure a rapid circulation of knowledge and information within the production complex. The accelerated transfer of technological knowledge allows Silicon Valley firms to build cumulatively upon a common stock of technological successes and failures, contributing significantly to the innovative dynamism of the region.