Why L.A. is struggling while San Francisco is beginning to boom again
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- Population trends in Los Angeles and San Francisco have moved in different directions since the COVID-19 pandemic.
- In both L.A. and San Francisco, the number of people per household has been going down as births decrease, worrying experts about the state’s long-term economic vitality.
The COVID-19 pandemic brought tough times for both Los Angeles and San Francisco.
Crime briefly rose. Rising housing prices — combined with the opportunity to work remotely — led to declines in population. Concerns over blight and quality of life became political issues.
But now there are early signs of a post-crisis divergence in fortunes between the two cities.
A tale of two cities
San Francisco is in the midst of a new tech boom fueled by artificial intelligence that has lured residents to the city and boosted the downtown economy. The city netted a small increase in population last year, according to new U.S. census data.
Los Angeles County, by contrast, is still struggling. Population losses are continuing, and its economy is being hit by several forces — including a shrinking Hollywood industry and President Trump’s immigration policies, which have slowed growth and upended some business sectors.
Home prices in San Francisco hit a record $2.5 million in March as wealth from the AI boom flowed through the city.
It will take many more years to see whether this become a larger trend. Demographers say the San Francisco boost is notable, but far from a sign of boom times ahead.
In fact, many experts say high housing prices and other factors continue to make more affordable cities outside California very attractive, especially to younger people.
“Housing is of course at the top of the line for most people who are leaving,” said Hans Johnson, a senior fellow at the Public Policy Institute of California. “San Francisco is experiencing a sort of AI boom even as other components of tech aren’t doing as well.”
Migration patterns matter
Census data show San Franicsco’s population was up 0.62% in 2025, in contrast to statewide numbers that remained mostly flat. L.A. County recorded a 0.55% decrease.
Another tech center just south of San Francisco — Santa Clara County — saw its population rise 0.33%. In San Diego County, the population dropped 0.16%.
The percentage changes are not huge, but they offer a snapshot of the regions.
In raw numbers, L.A. County lost about 54,000 people from July 2024 to July 2025, the largest numeric population decline in the nation, data from the Census Bureau show.
Although there have been high-profile defections to other states, California still attracts businesses — and creates a lot of them.
A major factor in 2025’s population trends was a sharp drop in net international migration. As the Trump administration launched an aggressive clampdown on immigration, L.A. County saw the number of residents coming in from abroad plummet from 92,000 people in 2024 to 29,000 in 2025.
Silicon Valley and L.A. reported losses similar to those of other states from 2024 to 2025, said Jenna Nobles, a professor of demography at UC Berkeley.
In Santa Clara County, international workers brought to the U.S. by tech companies helped stave off population losses to other states.
But that was not the case in Los Angeles County, which had a net loss of 105,000 residents because of domestic migration out of the region in 2025, a slight increase from the previous year when the county lost 99,629 people.
Hollywood is not a huge piece of the Los Angeles County employment. But it has become a source of major concern, with film and television shooting moving out of the state and job losses topping 45,000 in recent years.
One bright spot for Southern California has been a resilient aerospace industry.
Bouncing back differently
Those and other forces may have played a role in the nearly 40% of office space available in downtown Los Angeles at the end of last year, according to the real estate firm CBRE. Overall vacancy there climbed from 14% in 2019 to 34% in 2025.
Adding to Southern California’s economic struggles, the Eaton and Palisades fires contributed to a net loss of 0.5% in gross domestic product in Los Angeles County in 2025, according to a study by UCLA Anderson School of Management.
Los Angeles County lost 54,000 residents from 2024 to 2025, driven by immigration restrictions and continued out-migration to other states.
Office leasing in San Francisco, meanwhile, rose by 20% in 2024 and reached its highest level since 2019, per the San Francisco Examiner, as AI companies brought in tens of billions of dollars in venture money.
Though office vacancy in San Francisco was at 34.4%, more space was leased than vacated for the first time since 2019, according to the San Francisco Standard.
San Francisco’s unemployment rate was 4.1% in January, according to the Federal Reserve Bank of St. Louis. In Los Angeles County, it was 5.5%.
Johnson cautions about reading too much into the numbers — at least at this point.
Los Angeles County lost 54,000 residents from 2024 to 2025, driven by immigration restrictions and continued out-migration to other states.
“San Francisco has built a bit of new housing, most of it multi-unit housing and large buildings,” he said.
In both L.A. and San Francisco, the number of people per household has been going down as births decrease.
San Francisco already had a very low number of children per household, so it has been affected less by the nationwide decline in birth rates, Johnson said. “Los Angeles has further to fall.”
Another difference between the two cities is net migration to other states. San Francisco’s out-migration declined from tens of thousands per year during the pandemic emergency to about 100 people last year, while L.A. County’s net loss was more than 100,000, Johnson said.
The big picture
Since L.A. County’s population is more than 10 times that of San Francisco County, a net loss of 100,000 Angelenos would be proportionally similar to losing 10,000 San Franciscans.
“The big picture is that neither place’s population is changing much population-wise — it’s not like San Francisco is taking off,” he said, “and it’s not like Southern California is having huge declines in population.”
“We’ve moved from this young, growing, booming state to something more like a mature, slow-growing state,” Johnson said. “More like New York than Texas.”
The census findings should also affect state planning, he said. “There’s some real challenges there in terms of having enough workers to support an aging population.”
If populations stall, tax revenue may follow — especially sales taxes, per an analysis by CalMatters — leading to less spending power for the state as inflation brings costs up.
Times staff writer Jenny Jarvie contributed to this report.
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