Silicon Valley anxious to get stimulus money

January 7, 2009 7:12:48 PM PST
The Silicon Valley is anxious to see if it will benefit from any federal stimulus money.

"We can't remain immune from a recession of this magnitude," Randall Stross said.

Stross is a business professor at San Jose State University. He also writes about high tech for the New York Times and authored a book about Google.

Many in Silicon Valley are pinning their hopes on a major shift here towards green tech.

Electric car makers and solar energy companies are popping up.

However, Stross warns green tech is not going to offset the layoffs.

"Green tech involves more research, more laboratory work, the kinds of things that are not as labor intensive and are certainly longer term in nature," Stross said.

Tom Campbell points out the Valley is running lean and mean these days as a result of automation and manufacturing going overseas.

Fewer jobs are being created, as well.

"At the turn of the century, we were employing roughly a million people in the greater Silicon Valley area," Campbell said. "Now a steady state considered high employment is about 850,000, so we've gone through the shake-out, and that puts us in a much better position for the recovery."

Campbell is a former South Bay congressman, an economist and former dean of the UC Haas School of Business.

So, even though the new administration in Washington wants to pump money into infrastructure jobs, it may not help the private sector.

And start-ups, for which Silicon Valley is famous, are different today.

"They don't have to hire people, they don't need capital to hire people, they can use open-source software, they can use very inexpensive computer hardware, and they can launch a tiny little company on a shoestring," Campbell said.

So where does this leave the casualties of the recession, the thousands laid off?

As in the past, it may be time for them to re-invent themselves.