Layoffs have been peppering the news lately as Boston's technology economy is showing signs it's not entirely immune to the national downturn. Egenera, THQ Inc., Plexus Corp., Avid Technology Inc., ACT Electronics Inc. and Verizon Communications have all announced plans to cut their employee headcount, the Boston Globe recently reported.
The types of verticals in which companies are showing strains vary. Egenera, a player in the virtualization space, announced it would lay off 87 employees worldwide - with 30 to 35 employees being eliminated from its headquarters in Marlboro, Mass. California-based THQ plans to close its Burlington-based Helixe studio, which makes games for Nintendo DS handheld video game systems. That will eliminate 30 jobs.
Plexus, which makes printed circuit boards, will close a plant in Ayer by the end of the year and lay off 170 workers, while ACT Electronics will close its Hudson electronic assembly plant in late November, shedding 27 jobs. Meanwhile, Tewksbury’s Avid Technology, a video-editing software company, plans to lay off 54 workers in Massachusetts and 20 in New Hampshire.
| 'Consultants will have to expect lower pay rates, since there are far more candidates available now compared to last year.' |
Traditionally, Boston and its metro area has had a healthy balance of technology-focused companies, largely due to the region's strong higher-education foundation, which includes the world-renowned Massachusetts Institute of Technology (MIT), Harvard University and Tufts University, to name a few.
As a result, tier-one companies such as Raytheon, the state’s largest employer, Google, SAP, Oracle, EMC Corp., Hewlett-Packard Co. all have large offices located within the Bay State - along with a slew of technology startups. Cambridge, in particular, has more than 15 biogenic and pharmaceutical firms located within the city. And, according to recruiters, that has helped provide a certain degree of cushion for the area from the recent economic downturn.
"Most of our clients are spread in highly skilled technologies," says Jack Fellers, Boston's regional vice president for Robert Half Technology. "And those companies are still hiring highly skilled workers. Specifically, what are in demand are developers that have NET, Java, PHP, Web developer experience. Those still are at a premium."
In October, Dice listed 3,431 jobs in the Boston area, down from 4223 positions in January.
Matt Conley, branch manager at Sapphire Technologies' Boston office, describes the state of the area's employment as tepid. A good part of the market relies on financial services, he notes, a sector that's under particular pressure. He still sees firms interviewing but says many are "gun-shy" of pulling the trigger on actual hires. "I think at this point, many companies are in a holding pattern until 2009 budgets are released," he says. "But the right candidate with a positive attitude will always find themselves getting an immediate offer."
Conley describes Boston as a contract-driven market, and many companies are in a mode of realigning rates. Consequently, there's a disconnect in what consultants are asking and what firms are willing to pay. That means consultants will have to expect lower pay rates, since there are far more candidates available now compared to last year.
"With unemployment on the rise, history will prove that the companies will eventually get their way," says Conley. "The good contractors will tell you they are prepared to roll with the market and accept the ups and downs to stay on the projects. Those determined to hold their ground will find themselves missing out on long-term quality projects."
However, Conley says there are certain job skills that still are in demand as either full-time or contractor positions, such as project managers, system administrators, business analysts, .NET and J2EE developers. Client expectations are on the rise and niche skills are getting people hired, Conley adds. He's still optimistic for job seekers in the Boston area.
"There are still a large number of jobs out there if you know where to look," Conley believes. "At Sapphire, we have had more job orders in September '08 then we have had in the past three or four years."
Job postings in Boston declined by nearly 1,000 during 2008 |
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