No need to 'off-shore'. Presumably companies in the Bay area could start (or grow) branch offices in other places in the US that don't have such a high cost of living.

It may be that the cost to attract talent to the Bay area is now too high for all but the most profitable businesses. I have no idea if this is true or not but conceptually the giant payrolls needed may finally be overwhelming the benefits of locating a company in the area.