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A worsening imbalance: Redwood City leaders wrestle with rapid job growth, slow housing development

The city currently has one of the highest ratios of jobs to housing units in the county
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A new building being constructed with tower crane

Redwood City’s significant and growing jobs-to-housing imbalance may require a regional effort to solve, according to experts. 

The debate took center stage at a recent meeting of the city's Planning Commission, during which representatives from a private consulting firm debriefed commissioners on the city’s historic and growing disparity between commercial and residential growth.

As of 2019, Redwood City had 2.35 jobs for every housing unit, a more than 30% increase since 2002, according to a report presented by Jason Moody, principal at Economic & Planning Systems, Inc. (EPS). The city’s jobs-to-housing ratio ranks between 5th and 6th highest of 20 cities in San Mateo County, depending on measurement, which Moody said “reflects (the city’s) role as a job center in the county.” 

Countywide, the highest disparity was in Colma, where there were an estimated 10.5 jobs for every housing unit, while Pacifica had the lowest with only 0.37.

Moody attributed the widening gap to the “rapid job growth in this city,” which he said occurred primarily during the last decade. While jobs grew more than 40% from 2002 to 2019, the number of housing units increased by only 5.7% in the same time period. 

The jobs-to-housing ratio is often used to evaluate how well a particular jurisdiction is accommodating local housing needs generated by job creation. The focus on this particular metric “is motivated by concerns related to California’s current housing crisis, reduced affordability, increased commute times,” among other factors, according to a staff report. This information is often used to assess the potential impact of policy decisions and amendments to the General Plan or zoning code.

Facing historic levels of homelessness and rising rental prices, Redwood City has recently faced criticism for what some see as unsustainable commercial development without adequate housing to meet the needs of a growing workforce. 

Citywide, more than 9.1 million square feet of commercial space are in the pipeline, with the majority of that dedicated to office, life science or research and development projects. Based on conservative estimations from a 2015 Nexus study, these planned developments together will create nearly 29,000 new jobs in Redwood City. Currently 3,636 housing units are slated for construction, less than a third of which are categorized as affordable. 

As part of a commitment to build more affordable housing, the city has touted an ambitious goal of meeting 150% of its Regional Housing Needs Allocation (RHNA), with a plan to construct approximately 6,880 new units at all levels of affordability over the next eight years.

While Redwood City’s current RHNA target exceeds those of most other jurisdictions in the county, the consultants found that the city’s numbers are among the lowest in the county relative to its population and previous years’ goals. (These targets are primarily determined by the Association of Bay Area Governments’ 2050 household growth projections for all member cities.)

However, addressing the jobs-to-housing imbalance isn’t simply a matter of building more affordable residential units—at least, not within Redwood City alone.

Moody emphasized the “interconnected” nature of the regional economy, which has resulted in significant “crisscross” commuter patterns among the local jurisdictions. Currently only 10% of people who work in Redwood City are residents, while roughly 85% of employed residents commute out of the city for work, according to the report.

“I don’t think you can fix it on a city level,” he said, describing the boundaries between the county’s close-knit cities as somewhat arbitrary. “Everybody who lives in your neighborhood isn’t going to work in your neighborhood.”

Countywide, a broad mismatch between residents’ skills and earnings, as well as housing affordability, has also contributed to this trend, Moody said. 

“Redwood City is helping mitigate the employment impacts of other jurisdictions. And other jurisdictions are helping mitigate the housing impacts of Redwood City,” he said. Pointing to the impacts felt in Redwood City when Facebook opened in Menlo Park, he added: “They’re kind of interacting in that way.”

Commissioner Kevin Bondonno said these trends suggested that, while there was no “magic number” for an optimal jobs-to-housing ratio, the city should “plan for commuters” by prioritizing housing near transportation hubs.

Planning Commission Chair Rick Hunter called the current jobs-to-housing ratio “excessive and unsustainable” and “the greatest factor in our affordable housing crisis.” Addressing the interconnected nature of the regional economy, he proposed working on partnerships with neighboring cities “so we’re not just maximizing our own self interests by adding more jobs than the housing would justify.”

Four residents spoke during the public comment period, expressing their appreciation for the study session and their concern about development trends in Redwood City. 

One such resident, Kris Johnson, cited future jobs and housing growth projections, calling the disparity between the two “absurd.” 

“When we’re told that we have it covered because we’ve identified sites that will allow meeting our RHNA goal of over 4,500 housing units, that’s just not going to cut it,” he said.

Overall, Moody said that building more housing would “affect the situation to some degree” but that the impact would vary by the location and affordability of the residences. 

"It is a complex issue," he added.

Still, several commissioners emphasized the continued need for more housing in Redwood City.

“The focus should be on building more affordable homes and homes at all income levels to balance out the job growth in this city,” said Commissioner Chris Sturken.