High unemployment rates in Silicon Valley and California as a whole indicate tough times for technology job hunters.
Long America's leading engine of tech job creation, Silicon Valley is stalling out. While the 12,000 or so tech jobs lost there last year is but a fraction of the 200,000 created and then decimated by the dot.com boom and bust of 2000 and 2001, the positions being eliminated now represent a cutting to the bone by flagship companies that in some cases have never imposed layoffs before. The past couple of months have brought news of 6,000 cuts at Google, 5,000 or more at Intel (after a 90 percent drop in fourth-quarter income), 600 at Adobe, perhaps 3,000 at Yahoo!, and 1,000 at eBay. Things are changing, and changing fast.
"Organizations are saying, 'What is the absolute nuclear winter? Let's plan for that,'" Adam Charlson, senior partner at search firm Korn/Ferry International told Reuters in January. "What you're seeing now is organizations putting those plans into reality."
The unemployment rate in the San Jose-Sunnyvale-Santa Clara area was 7.8 percent in December 2008, up from 5.1 percent a year earlier. The only good news about that is was better than California's statewide unemployment rate of 9.1 percent. The national rate in the same periods was 7.1 percent.
On Dice, 2008's second half saw first a steady, then a precipitous drop, in available job listings for tech positions in Silicon Valley. In the fourth quarter they dropped almost 40 percent, with a current total of just over 2,800 available. That's down 55 percent from one year ago. It's amazing to note that for the first time, the number of Dice job listings for the Valley barely beats that of Los Angeles, Boston, or Chicago.
Looking forward, the quarterly Manpower Employment Outlook Survey, which covers all industries and is a good indicator of general employment trends, suggests hiring and firing across the western U.S. will wash out to a net zero gain in employment during the first quarter. However, it notes that Professional & Business Services, where IT experts often count themselves, show the best hiring prospects among the 12 industry sectors surveyed.
Are there any glimmers of hope? Sean Norris, the Silicon Valley branch manager who covers both San Francisco and the Valley for IT recruiter Sapphire Technologies, says, "We have seen a considerable decrease in the need for IT workers at certain Bay Area financial companies, but there is optimism at a few of the local banks and financial firms that have done okay throughout this meltdown. While things seem to be on hold right now, we are hearing that some groups have hiring plans in Q2 and beyond."
According to Norris, the skills most in demand today are the same ones that have been in demand for at least the past six months: software engineers, systems administrator, QA testers, project managers, and business analysts.
In this environment, those lucky enough to find a new job will be happy to learn they'll be relatively well paid. According to the annual Dice Salary Survey, IT workers in Silicon Valley are still the highest paid in the nation, with an average 2008 salary of $97,259, ahead of Washington D.C. ($86,841), L.A. ($86,766), New York ($85,452), and Boston ($84,627).
One way out of the Valley's blues may be through green technology. In its annual presentation of projections for the new year, the Silicon Valley Leadership Group, a local economic development think tank, pointed out alternative energy is one growth market that's holding its own: "Green technology businesses in California grew by 84 percent between 1990 and 2006 … Much of this growth occurred in solar energy, energy efficiency, and green transportation; many of these innovative companies are located right here in Silicon Valley."
Silicon Valley jobs on Dice dropped
40 percent in the fourth quarter
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