San Jose was California's first civic settlement, founded in 1777 by Mexican colonists and named El Pueblo de San Jose de Guadalupe for St. Joseph and the Guadalupe River near the town site. The town was established in order to bring agricultural development to the Alta California territory; each settler was issued animals, farm implements, seeds, and a 10-dollar monthly stipend. These farmers joined Spanish missionaries who were already in the area. The Native American inhabitants of the region were the Olhone; the disruption of their culture by the missionaries and farmers and the spread of diseases eventually led to their virtual extermination.
As a supply station for prospectors during the gold rush, San Jose underwent a population explosion; upon incorporation in 1850 the city's inhabitants numbered 5,000 people. San Jose was the state capital from 1849 to 1851, and then became an important stage and boat link on the route to San Francisco until the advent of the railroad in 1864. Growth continued through the 1880s, reaching a culmination with the real estate boom and bust of 1887 when land sales totaled $2 million per day before the market collapsed. By the turn of the century San Jose was a major center for the cultivation of apricots, prunes, and grapes; with rail connections to other cities, it was also an important regional shipping hub.
Prior to World War II San Jose, with its 18 canneries and 13 packing houses, was the world's largest canning and dried-fruit packing center. The city also pioneered the manufacture of specialized mechanical farm equipment in California; among the products introduced by local inventors were the spray pump and the steam-powered stemmer-crusher for wine making. In the 1950s, however, San Jose was transformed from a farming community to a high-technology capital by another of its natural resources: silicon. This element is used in making semiconductors, a basic component in high-technology industries. Thus San Jose and Santa Clara County came to be known as "Silicon Valley." Originating at Stanford University in nearby Palo Alto, a vast military-industrial complex, which includes the Ames Research Facility of the National Aeronautics and Space Administration (NASA) at Moffett Field, ultimately spread throughout the Southern Peninsula.
San Jose's largest population boom was triggered by this high-technology revolution, and growth continued unabated from the 1950s through the early 1980s. Buoyed by the success of computer companies, a steady flow of venture capital poured into San Jose and Santa Clara County to finance new firms that sprang up almost overnight. Expansion began to moderate only with the 1985 recession in the computer industry. Unemployment remains relatively low in the San Jose metropolitan area, as more than 20 percent of the semiconductors and related devices made in the United States continue to be produced in the Silicon Valley. The city nevertheless has been faced with problems resulting from uncontrolled development. Steps have been taken toward a solution, in the form of a new light-rail system designed to alleviate traffic congestion and stricter controls on expansion and construction. By the end of the twentieth century, residents and city planners alike were looking ahead. At the start of the twenty-first century, San Jose boasted great economic opportunity, many jobs, and a high standard of living. The area frequently ranks near the top of quality of life studies sponsored by universities and national media.
Historical Information: History Museums of San Jose Archives, 1650 Senter Road, San Jose, CA 95112; telephone (408)287-2290