csua.org/u/clj -> www.nytimes.com/2005/07/03/business/03valley.html?ex=1278043200&en=5844291bf3c1c4a4&ei=5088&partner=rssnyt&emc=rss
Cisco's Balance of Automation And Workers (July 3, 2005) Peter DaSilva for The New York Times John Kish of Wyse is expanding his company's worldwide work force to abou t 380, from 260. Responding to booming demand in Asia and in Europe, Wyse is adding new de velopment teams in India and China and expanding its worldwide work forc e to about 380, from 260. Its profits are recorded here - but almost non e of its new jobs. Amid widespread signs of economic recovery in the region, Wyse is emblema tic of its economy, in which demand, sales and profits are rising quickl y while job growth continues to stagnate. In the last three years, profits at the seven largest companies in Silico n Valley by market value have increased by an average of more than 500 p ercent while Santa Clara County employment has declined to 767,600, from 787,200. During the previous economic recovery, between 1995 and 1997, the county, which is the heart of Silicon Valley, added more than 82,800 jobs. Changes in technology and business strategy are raising fundamental quest ions about the future of the valley, the nation's high technology heartl and. In part, the change is driven by the very automation that Silicon V alley has largely made possible, allowing companies to create more value with fewer workers. Some economists are wondering if a larger transformation is at work - acc elerating a trend in which the region's big employers keep a brain trust of creative people and engineers here but hire workers for lower-level tasks elsewhere. "What has changed is that Silicon Valley has continued to move up the val ue chain," said AnnaLee Saxenian, dean of the School of Information Mana gement and Systems and professor of city and regional planning at the Un iversity of California, Berkeley. That has meant that just as low-skille d manufacturing jobs fled the region starting in the 1970's, now softwar e jobs are also leaving. The phenomenon is only the latest twist in the region's boom-and-bust his tory, marked by repeated cycles of innovation and renewal over the last five decades. Industries based on personal computing, hand-held devices and electronic commerce have emerged and thrived here, and each brought waves of new jo bs. Now, almost everyone agrees that Silicon Valley is coming back, and employment there grew from March to May, but the area still has about 10 ,000 fewer jobs than there were a year ago. The increase in profits "has been very dramatic, but there's no job growt h," said Doug Henton, president of Collaborative Economics, a regional c onsulting company. Some former technology workers have given up on the sector - or moved out of the Bay Area altogether. Catherine Haley, 32, went to work in 1997 as a project manager and a Web designer for technology companies in the area, but after quitting the co nsulting firm KPMG in 2002, she found it extremely difficult to find a f ull-time job. In 2004, after working in piecemeal assignments for two years, she gave u p on the job market and nearly moved back to Boston. Instead, she decide d to pursue her passion - art - and is now majority owner of a gallery i n San Francisco. She does not miss fighting for work, she said, partly because the high-te ch economy has lost its charm. "Unfortunately, the number of interesting projects and companies out there has really come down," she said. In some cases, as at Wyse, the job growth in the sector is taking place e lsewhere - in lower-cost, higher-growth markets. A new management team, installed as part of a buyout of the company that was completed in April, is leading a restructuring that includes adding 100 workers in India and 35 in Beijing so far this year. At the start of the year the company had 90 percent of its work force in Silicon Valley ; now the figure is 48 percent, and only 15 percent of its engineering t alent remains here, largely because of the technology development teams it is building in India and China. "It was pretty clear that growth was going to come first in Asia," said J ohn Kish, Wyse's chief executive. "We had the desire to get engineering teams to those markets as quickly as we could."
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