According to MarsBit, the IPO boom of AI companies such as OpenAI and Anthropic has dramatically increased the cost of living in San Francisco, leaving tech professionals earning six-figure salaries—around $150,000 annually—unable to afford a one-bedroom apartment. This phenomenon has redefined what it means to earn a six-figure income, now considered 'not enough' in the city, putting mid-level tech talent under pressure to relocate.
The wealth generated by AI IPOs has flooded the high-end rental market, with executives and early employees cashing out stock options and bidding up rents in prime neighborhoods. Meanwhile, salaries for regular tech positions have not kept pace with housing costs. A typical engineer earning $150,000 faces a monthly rent of $4,000–$5,000 for a one-bedroom, leaving little after taxes and other expenses. This 'high-income squeeze' is reshaping Silicon Valley's talent flow, with more mid-level professionals moving to more affordable cities like Austin or Seattle. Analysts warn that if the trend continues, San Francisco may struggle to retain the non-elite technical workforce that underpins its innovation ecosystem.