In the fine print of a jobs report published today is some mixed news for Silicon Valley.
For the first time in this downturn, the region lost jobs; it has 4,000 fewer jobs than it did a year ago at this time, and its unemployment rate is 7 percent, according to the Center for the Continuing Study of the California Economy, which analyzed the California Bureau of Labor jobs data.
That rate compares favorably to California over all, which has an 8.4 percent unemployment rate, the research firm reported. “California is following the nation into the longest and deepest national recession since the 1980s and, possibly, since the Great Depression,” writes Steve Levy, the firm’s research director.
As for Silicon Valley, he asserts the fundamental economic strengths of the region put it in a relatively good position, but a vulnerable one nonetheless. “Silicon Valley will enter the recession from a stronger position and be in a stronger position when the recession ends BUT the next 12 months will bring recession to the Valley — more job losses and rising unemployment,” he wrote in an e-mail message.
At this point, that sounds like a far cry from the technology-centric implosion of 2000 when unemployment hit 9.2 percent. Perhaps, even, the valley will benefit from stimulus and infrastructure spending by an Obama administration that favors the green technology that Silicon Valley’s venture investors — and big compa nies too — have banked on heavily.
Meantime, company executives and workers here say this downturn feels different from the dot-com bust. Then, the downturn felt more specific to the region. Not just tech companies, but commercial and residential real estate brokers, restaurant owners, hairdressers — everyone in the region — felt the pain of the bust, directly or indirectly. As one tech industry worker told me the other day, “When the bubble burst in 2000, it felt very personal to those working in the Web world.”
This time is less scary for some here because the pain is less concentrated and localized. On the other hand, there is a sense that this downturn has less of a simple explanation, and thus the factors behind it fell more out of control. The person I spoke to, a manager at a Web design firm, said: “It’s different because it’s everyone.”
By Matt Richtel
Blog of Intellectual Capital 