Additionally, Silicon Valley in particular benefits from having multiple companies in overlapping specialties. Suppose I’m a GPU expert working for NVIDIA, and suddenly I hit a setback and it’s time for a new job. Well, Apple is just a few miles away, and Apple makes GPUs and NPUs, and so I’d have a shot at working for Apple.

Contrast that with people living in areas with little diversity among tech companies. For example, Intel recently laid off a ton of engineers working near Portland, Oregon. There are few alternative technical employers in the region, especially in the specialties Intel focused on in Portland. Those laid-off engineers are facing the prospects of pivoting to a different tech specialty with more employment opportunities, competing for remote jobs at a time when so many companies are requiring their employees to return to the office, or relocating from Portland, which is massively disruptive and can potentially be very expensive. Some may be forced to retire early.

Silicon Valley may be insanely expensive and ultra-competitive, but it also has critical mass, which is vital for highly-specialized engineers and researchers.