Silicon Valley may have thought it was bullet-proof. But it is not. High tech companies are being forced to face the recession as advertisers cut back.
"Now it's clear that they're cutting back everywhere in new media and old media, so Silicon Valley also is going to be facing some contraction," senior technology editor for the Wall Street Journal Online Julia Angwin said.
Valley high tech companies have already filed required notices with the state that they are laying off 569 workers this month and 794 next month. Those figures do not include the unannounced number of layoffs at Yahoo. Yahoo corporate spokesman Brad Williams said the company does not comment about rumors or speculation. Angwin noted that /*Carol Bartz*/, the new CEO at /*Yahoo*/, had indicated when she took over the company recently from co-founder /*Jerry Yang*/ that it was better not to prolong the layoff process.
High tech workers taking a lunch break today along Murphy Avenue in downtown Sunnyvale are taking the growing layoffs numbers in stride. While no one would admit to ABC7 News that they were worried about their own job security, several said they know it will be difficult for laid-off workers to find new jobs in the current economy.
"I think a re-set is much more likely at this point; it doesn't mean we never come back, but to expect to bounce back in a couple of years and take off into the excess of the last few I don't see as a possibility," Peter Murray said.
Still, veterans of Valley turmoil remain optimistic.
"I've gone through two bankruptcies, two other companies that closed down; I'm still here," Carmella Sutton, who has worked in the Silicon Valley for 32 years, said.
As companies trim staffing, there is a spillover effect on their suppliers and vendors. Craig Almeleh, principal at San Jose based architectural firm Arc Tec, said that the downturn has led to fewer building projects and more vacant office space. Almelh's client list includes some of the firms slashing jobs. He anticipates it could take six months to lease two buildings he recently renovated. No one is ready to make commitments until the economy recovers.
"I don't think anything will improve until there are clear signs, and they are going to basically hunker down until they see not only a turn-around but a turn-around where they can justify growth," Almeleh said.