SAN JOSE, Calif. — Downtown San Jose is experiencing a noticeable economic upswing, with job growth and increased foot traffic signaling a positive trend.
Downtown San Jose sees economic revival
Downtown San Jose shows improved job numbers and more people on the streets, according to a recent city report.
- Job numbers in downtown San Jose rose 8.3% in fiscal year 2025.
- Office rental rates saw a 21.7% increase.
- Foot traffic increased by 7% in the past year.
- Office vacancy rates remain high but saw a slight increase.
What is the latest on downtown San Jose’s economy? Downtown San Jose has seen a significant increase in economic activity, with jobs and foot traffic showing marked improvement.
A Period of Transition and Reinvestment
The report, covering the 12 months ending in June, indicates visible progress despite economic challenges. The city government report stated that downtown San Jose is undergoing a period of transition and reinvestment as it recovers from the COVID-19 pandemic’s impacts.
Job Growth and Pre-Pandemic Comparisons
In fiscal year 2025, downtown San Jose supported an estimated 27,400 jobs. This marks an 8.3% increase from the 25,300 jobs recorded in fiscal year 2024, which concluded in June 2024.
Before the pandemic-related business shutdowns in March 2020, downtown San Jose boasted approximately 43,000 jobs in mid-2019. This figure had previously fallen to 33,700 by mid-2023.
Residential Population Stability
The Economic Development Office reported that approximately 23,000 people resided downtown during fiscal year 2025. This population remained unchanged from the prior year but was higher than the number in mid-2023.
In mid-2019, about 22,000 people lived downtown. This number rose to 24,000 by mid-2021, then decreased to 23,000 in mid-2022 and 21,400 by mid-2023.
Foot Traffic and Economic Indicators
Downtown foot traffic experienced a 7% rise over a one-year period ending in April. The report defines downtown San Jose as the area west of Fourth Street, south of Julian Street, east of Interstate 280, and encompassing areas near the SAP Center and Diridon train station.
Office Market Trends
Despite improvements in rents, downtown office vacancy levels remain high. The vacancy rate stood at 29% in fiscal year 2025, a slight increase from 28% the previous year, according to the city study.
San Jose State University’s Integration
The report also highlighted the growing synergy between San Jose State University and the downtown area, benefiting both entities. In August 2024, the university opened Spartan Village on the Paseo, a 13-story student housing complex within a former hotel tower, offering 700 beds.
Anticipation of Major Sporting Events
This economic upswing for downtown San Jose comes as the South Bay prepares to host significant sporting events, including the Super Bowl, FIFA World Cup matches, and NCAA men’s college basketball tournament games.
The city report noted that downtown is attracting new large-scale events and businesses, with public space improvements creating a more vibrant environment. These trends signal an evolving identity as a mixed-use district poised for future growth.
