Monday, March 24, 2003		Feature

Jobs take a plunge in Silicon Valley
Lisa Baertlein

THE dotcom poker buddies of San Francisco resident Ken Belanger knew a losing hand when they saw one. Most of the original 10 members no longer turn up for a monthly poker night. That form of gambling has been overshadowed by Silicon Valley’s higher-stakes losses of money, jobs and above all, its fabled swagger.

"I know a bunch of people who are disgusted," Belanger said. "It’s really sad, people don’t believe anymore."

Silicon Valley, which vaulted to astronomical prosperity in the Internet boom, is still tallying the cost of an unrelenting two-year downturn. For many, the toll is measured in departed friends, grudging acceptance of low-wage part-time jobs, or the loss of little luxuries like hair salon appointments and season tickets.

California’s latest revised employment figures showed Silicon Valley’s Santa Clara County alone lost 1,91,500 jobs—or nearly one in five positions—between the employment market peak of December 2000 and January 2003.

The state also is bracing for weak February numbers after the US Labor Department on Friday said US job losses last month posted their steepest one-month slide since the Sept. 11 attacks.

Marc Andreessen, who rode high as a former poster boy for the 20-year-old Internet millionaires minted during the boom, sys Silicon Valley’s current mood reminds him of the malaise that reigned when he arrived in 1994.

"The Valley goes through this cycle of very high self-regard, followed by this long period of self-loathing," said Andreessen, who co-founded Netscape and helped spark the Internet boom.

Boom-and-bust cycles are certainly nothing new to the greater San Francisco Bay area. But the damage wrought by the dotcom implosion has been broadly felt since so many area companies fed from the New Economy trough.

"This one is the worst ... This time it’s everybody," said Jeff Hellman, an out-of-work software tester who is hoping to make a living by playing guitar outside Silicon Valley-area coffee shops and selling his own recordings.

San Francisco’s best-known downturn came after the Gold Rush of 1849, when banking and mining interests pulled up stakes. Lesser-know upheavals hit Silicon Valley in the 1970s, when microchips supplanted defence; in the 1980s, when the personal computer came to the fore; and in the 1990s, when the industry’s focus shifted to software and the Web.

The latest bust has claimed several New Economy icons. Scores of smaller companies have quietly failed, and others, like electronic testing and equipment maker Agilent Technologies Inc. and video game publisher Sega Corp., have recently cut more area workers.

Santa Clara County includes such tech-heavy cities as San Jose, Sunnyvale and Palo Alto. It absorbed about half of the state’s post-boom job losses and had a January unemployment rate of 8.6 per cent—above California’s 6.5 per cent and the national average of 5.7 per cent.

One place where the jobless congregate is Craigslist.org, which rose to local popularity with its boom-time help-wanted and apartment listings. These days the Website hosts community forums where displaced members of the New Economy work force compare hints on how to eat on $3 a day, discuss whether to take a job with a big cut in salary, and, on rare occasions, raise a red flag about their own suicidal feelings.

Despite all bad news, residents are quick to admit that the boom created a tremendous amount of personal wealth. Many also believe the area’s base of skilled workers, venture capitalists and strong universities position it to be the launching pad for the "next big thing."

But Pierce Ledbetter decided not to wait things out. He went home to Memphis after his three-year stint in Silicon Valley and has since started a software security firm.

"San Francisco’s biggest export used to be technology, today it’s people," he said.