More Than 500,000 High Tech Jobs Lost in 2002

stoolpigeon writes: "A study, released today by the AeA, shows that the U.S. high-tech industry lost 540,000 jobs in 2002, dropping from 6.5 million to 6.0 million. However, a preliminary look at data for 2003 shows that the decline in high-tech employment has slowed considerably this year."

Comments

Jobs Lost?

[tarquin_fim_bim]

That seems to give the impression that they were carelessly mislaid, or accidentally cast aside. Far from it, they were purposefully relocated to a more hospitable economic environment. Free market, free trade, free information, free software and free beer, what more could a philanthropist ask for?
OK, free love, but that always comes with a price.

Re:Jobs Lost?

[dpilot]

Someday somebody will figure out that many American execs are super-paid and don't really know their own business. (They know MONEY, not the products their companies make.)

Then since the executives do the outsourcing, they won't outsource themselves, the places they've outsourced to will go into business for themselves, and drive the American companies under.

Re:Jobs Lost?

[D-Cypell]

It is easy to blame outsourcing, and I do admit that this plays a big part.

However, we must also remember that during the late 90's and the early 00's thousands upon thousands of tech jobs just sprung up out of thin air. Any fool with a business plan penciled out on a napkin could get millions in VC. As the remenants of these companies finally disappear in true darwinian fashion, the jobs that were created will obviously be lost.

I would be interested in seeing some stats on how many jobs were created in those few years compared to the losses recently. It sounds like it could be a case of just ending up back where we started from.

Re:Jobs Lost?

[jagapen]

Outsourced management. I'm sure there's a CEO over in India who'd run the company for less than a quarter the compensation an American CEO expects. Plus, he'd be close to the workers!

Re:Jobs Lost?

[ploppy]

Take a look at this very recent article. This article points out that American IT management is way over-priced compared to Indian management, and hence management will be the next thing to go off shore. As it says in the article, this is American IT self destructing.

Military: good jobs, good training

[Preach the Good Word]

I was an electronics tech for the Navy. Did maintenance on comm gear and other electronic equipment. Went through a variety of schools. I feel the education is very good and the hands on experience is great. I worked with a variety of test equipment, receivers, transmitters, communication gear, etc.

When I was in, the most technologically advanced jobs were CTM (Crypto Tech Maintenance), ET (Electronics Tech), DS (Data Systems), among others (more specialized).

One individual I met while in was a Senior Chief ET at Treasure Island. As far as I know, he was one of the people to first develop laser listening devices for civilian purchase, or at least one of the first that I've heard of. I didn't see a working model, but he explained what it was and how it worked to me.

At yet another installation, I met a group of Navy Petty Officers and Air Force Sgt's that were developing a means to render video to CD, at the time, it wasn't common place (I hadn't even heard of the technology at the time) to find video on CD's.

There's many "cutting edge" tech gadgets being used in the .mil, of course these are the ones you never hear about until they're released to civilian use.

It's like the old story about the guy that invented the first "radar gun" for highway patrolmen, he also invented the first "radar detector" for civilians. :-)

In related news, a Pakistani extorts US firm

[Serveert]

This could have been an Indian, Chinese, whoever.. this is the future where we cannot hold anyone in the third world accountable yet we expect them to handle sensitve information and intellecutal property.

I'll get modded down but here's the article:

http://www.sfgate.com/cgi-bin/article.cgi?file=/ ch ronicle/archive/2003/11/12/BUGI52VMQR1.DTL&type=bu siness

Breaking her silence for the first time, the Pakistani woman who threatened to release UCSF patient files on the Internet says she had "no choice" but to breach the hospital's security after being cut off by the Texas man who'd made her the final link in a long chain of clerical subcontractors.

Lubna Baloch said by e-mail from Karachi that she is "not an opportunistic person who willfully did that to gain some attention."

She said she is instead the "worst sufferer of this situation" because she was only trying to secure UCSF Medical Center's help last month in obtaining money that she was owed.

"I feel violated, helpless," she wrote, adding that she is "the most unluckiest person in this world."

Doctors at U.S. hospitals routinely dictate notes about patient visits, consultations, operations and discharges. Those notes in turn are frequently handed to outside firms that specialize in transcribing them into written form.

The case involving UCSF's patient files represents the nightmare-scenario- come-to-life for the medical industry. For about 20 years, UCSF has farmed out much of its transcription work to a Sausalito company called Transcription Stat.

Transcription Stat outsourced many of the hundreds of files received daily to a network of 15 subcontractors. One of these was a Florida woman named Sonya Newburn, who then outsourced the files yet again to a Texas man named Tom Spires.

Spires outsourced the work one more time to Baloch in Karachi, who agreed to do the transcribing for a small fraction of the amount UCSF originally paid Transcription Stat, thus allowing everyone in the chain to walk away with a modest profit.

But on Oct. 7, Baloch attached two patient files to an e-mail and contacted UCSF. She demanded that the medical facility assist her in squeezing outstanding funds from her employer, Spires.

"Your patient records are out in the open to be exposed, so you better track that person and make him pay my dues or otherwise I will expose all the voice files and patient records of UCSF Parnassus and Mt. Zion campuses on the Internet," Baloch wrote.

A better set of questions

[PureFiction]

1. How many jobs gained during the "bubble" of the late 90's (that was unsustainable) are factored into that count?

2. How many H1B visas that are unrenewed are part of that count? (Exploitative consulting agencies? They loved to pump up the numbers)

3. How many psuedo-engineers have rightly left the CS/IT job market because they dont have the skills?

I worked with a guy briefly in 2000 that got paid $75/hour, 60 hours a week, for a whole month (before jumping ship to greener pastures in Silicon Valley) to write some horribly broken and incomplete perl CGI code.

Yes, nasty perl CGI that didnt work. It was obvious his skills were at tech college freshman / skilled high schooler level, and yet he was able to pull in an insane wage due to irrational exhuberance.

You hear these stories, and it doesnt really sink in until you see it first hand. Things were severely out of balance.

We are almost out of the hangover. If you are truly skilled, you can find a job with some elbow grease and effort 98% of the time. You may need to relocate, you may need to settle for something less than ideal, but they are out there.

The tech services (specifically programming / engineering) are picking up and we are on course for a return to semi-normality. But against the backdrop of insane compensation and free flowing VC cash, even normalcy appears spartan.

The best thing you can do for a career in IT is to truly love it and find it fascinating. This will keep your skills sharp as you experiment and play with cutting edge technologies on your own, and maybe on your job, and also provide the motivation needed to obtain a deeper understanding of the many details associated with programming, system administration, engineering, etc.

If you are in this field for the money, you wont have the drive to stay afloat.

Re:My Experience

[Cajun Hell]

I give the applicant my laptop, with a series of programming problems that should take no more than 15 minutes to solve.

Without exception, everybody fails or takes WAY too long to solve.

Yeah, I lost a job opportunity, but I still think I came out ahead -- whenever I think about the expression on your face when you realized I wasn't bringing your laptop back.

On the downside, I do hate your DVORAK keyboard layout. It took me 40 minutes to type this post. No wonder any of the other applicants ever finished their assignments.

FACT 1: Your job is not hard.

[Anonymous Coward]

FACT 2: There is a limited demand for your job.
FACT 3: For practical purposes, there is an unlimited supply of people who can learn your job.

Now justify your standard of living.

Note: "I am American, and thus entitled to living better than 90% of the world's population." is not a convincing argument.

Unless you're doing something that only you can do, expect your wage to fall to a level that is attractive only to the poorest people in the world.

Moral: learn to do something remarkable, or accept that you don't deserve more than three meals a day and a warm place to sleep.

Re:FACT 1: Your job is not hard.

[fermion]

The fact is that the work I have done is not so hard, and many people could do it, and the work has not in any absolute sense been worth the money I was paid. That, of course, is only because money really has not worth until it is normalized to the fiction of the people who use it.

That said, the standard of living is justified based on the culture of consumerism. Someone needs to buy those $100 pair of sneakers, or that $200 gaming system, or that $400 mp3 player. And to do that you need cash. You need enough cash so the opportunity costs of such purchases are not so great that you will decide these things are not a good value. If you have a job that brings home $1000 a month, and you need $400 for rent and $200 for food and then clothes and transportation to work and medical care, these other things are not going to seem so important. I mean you might start downloading music over your $300 used computer and your $15 dial-up connection, which are justified by your kids educational needs, instead of paying even $1 for the track.

Of course all these are way overpriced. We pay middle men, ad men, men in suits, and men in trucks to get the product to us. Certainly if we lowered our standards, bought locally, and only what we needed, then prices would fall. We could make $1000 a month and afford all we need and a few extras. Of course without ads, we would not know we may not know we need a new pair of sneakers. If we do not know we will not buy. If there are no ads, there is not TV, radio, internet. If we do not buy, there are no jobs elsewhere, unless wages in those areas go up high enough to support the infrastructure.

of course, we could buy everything used. But someone would have to buy new. So how many people would that take. 10%? 20%? Would 20% of the population have remarkable skills that would justify a high wage. Could they buy enough to support the world economy and give us their hand me downs.

It is a house of cards. No one deserves the standard of living. No one deserves to be told if they do not movies and music at full price they are killing the children of hard working artists. No one deserves to be told that if they do not spend their little expendable income on a dinner at McDonneld's or a new pair of sneakers that are they are depriving their child. Unfortunately, that is what people in the U.S. are told. Unfortunately we are told that we must spend, while the jobs that allow us to spend are shipped off to other countries.

I am not saying this is right or wrong, good or bad, necessary or not. I am just saying that I do not believe it was India or China that made MS or Nike or McDonalds rich. I believe it was citizens of the US that did that. And now that they are done with us, they will continue consuming resources elsewhere. Someone needs to buy the products at the inflated prices. Someone needs to have the wages to afford it. If it is not the US, then it is someone else. And that someone else will have deserve it no more of less than those who had it previously.

Re:FACT 1: Your job is not hard.

[pla]

Note: "I am American, and thus entitled to living better than 90% of the world's population." is not a convincing argument.

I can see you have a poor grasp of sarcasm, so I'll spell it out for you...

We currently live in the 21st century. Not the 19th.

The jobs we ship to people "willing" to work cheaper do not, for the most part, improve the lives of those they go to. We destroy the land the local populace used to at least manage to survive on, make them wage slaves for a pittance far below liveable, and when Nike, or Union Carbide, or Walmart, or whatever company, finally gets bored and moves elsewhere, they leave slums and wastelands.


Now justify your standard of living.

Okay, I will do exactly that.

What does Nike make? Shoes. Expensive shoes. Can a typical sweatshop laboror, whose life you seem to think Nike enhances greatly, buy those shoes? No. I can. You probably can. Most Slashdot readers probably can. We "justify" our standard of living simply by having it (or did some religion's imaginary friend wave the "US propserity and world hegemony" wand to give us our standard of living?).

Had you not decided to karma-whore (as an AC? not very useful...) with the "I feel so sick of whining programmers" card, you might have noticed my point - That we don't "help" third-world countries by forcing the local populace into corporate slavery. We lower our own standard of living without raising theirs.

I fully support raising the world-wide standard of living. Paying someone less than their food costs them (regardless of physical location) does not accomplish that.

Re:FACT 1: Your job is not hard.

[thesilverbail]

I fully support raising the world-wide standard of living. Paying someone less than their food costs them (regardless of physical location) does not accomplish that.

As an Indian in the IT industry I resent your charecterisation of us as starving slave labour. You just compare our salaries on an exchange rate basis without factoring purchasing power parity and then say that we're being made to work for a pittance. Well guess what? A thousand dollars a month is a very comfortable salary in India.

You're just desperately trying to find some excuse so you can oppose outsourcing "in principle" when all you're really worried about is your job.

I feel sorry for people in the US hit by outsourcing and the job crunch. But it's hard to feel bad about it seeing the good things it has done in my country, giving it a chance to come out of its poverty and maybe into some kind of economic parity with the first world.

Re:My Experience

[Junta]

So you give an on the spot practical exam, give a hard deadline of 15 minutes for a series of problems, to someone who has enough pressure expecting a typical interview? And whose authority says the problems are together a 15 minute problem? Maybe they would be able to tackle them in under 15 minutes after getting into their groove. Giving a simple pass/fail evaluation of a 15 minute session of problems that are likely ill balanced, i.e. focused in one area. You could end up with a developer who can whip right through those, but turn out not to be well rounded.

What I have seen to be a better selector is strategies where the interviewer puts forth a problem that is technical and high-level in nature, and disallows use of a computer, and ask that the applicant think aloud about the strategy and algorithms they would try to accomplish the task. The interviewer then gets more information. For one, the circumstances are less stressful, so it is a better indication of typical performance.
Also, whether or not they end up at the right solution is less important than if you can see they have a good thought process and good ability to recover from changing circumstances (in the middle of the problem, introduce new requirements).

I do agree that the dot-com crap created a lot of untalented, uninterested people seeking computer jobs simply for 'easy money' rather than a sincere passion, but knowing how very many talented developers I have seen unemployed over the last half a year, I would say either you aren't posting it in any visible spot or that your 15-minute test is a flawed approach.

Detritus from the .com bust

[Anonymous Coward]

Regardless, individual stories of people who got fired/layed off/whatever are barking up the wrong tree in this thread. This has to do with macroeconomic supply, demand, and productivity. And I'm going to argue that things are _better_ with these types of market corrections.

First off, I'm just not buying the 'overseas' argument. I think the people hit hardest are web designers and other low-tech technical people (and some niche high-tech people) - en masse, the jobs just didn't need doing, rather than things that needed doing but are easily farm-out-able. The latter set of jobs seems to me to be rather minimal anyway.

Understand that jobs lost numbers are not 'people who lost their jobs', but 'these jobs no longer exist' - it's not necessarily the case that we 'lost' them to someone else.

Question: of the jobs lost, how many of those didn't need to be done? Answer: all of them (when taken in aggregate). Either the companies died, the work the people did wasn't valuable, or the individuals themselves were not very good and others took up the slack anyway.

Taken not in the individual case, but in general - good people get hired to do something else, and the bottom strata have to find jobs in another industry - arguably, they shouldn't have been here in the first place, but they rode the wave. Sure, there will always be individual cases where this isn't true - usually due to people who are not, for one reason or another, willing to go where the jobs are. (Only these last people are ones for whom a 'move to india' (or wherever new jobs are going) actually makes sense).

What this means is that the salaries for these jobs have either gone into: something not technical but useful, lower prices, stockholder equity, or higher CEO compensation (or any of the other drains on productivity, like lawyers, or increased state taxes, or whatever).

In 3 of the 4 cases, that's a GOOD thing. Note that CEO compensation, and perques in general, haven't been increased due to the bust, and despite SCO, I haven't heard of Lawyers and such hangers-on's incomes being spectacular.

What this means is that if productivity stays high, the total amount of work done has become cheaper. If productivity goes lower, that means that the lost work being done before wasn't valuable - if it was, then it would still be being done (market forces driving production). Finally, in either case, those who _did_ migrate from one job to another are hopefully doing something 'better' (usually are - most of the 'best work' of a job is done in the first year or two, IMO, and someone made a recent decision that this job was worth doing enough to hire someone).

So, all in all, a decline in jobs isn't necessarily a bad thing - it's very possibly a good thing. It's a "correction" of an inherent weakness, and might make us stronger and more productive because of it.

Darwin was right, and we are surprised?

[Bug-Y2K]

For almost two decades, the IT industry, in the form of corporate IT departments have been telling their masters:
"Invest in technology, and it will pay off in increased productivity and profits."

For the past 10+ years, the IT industry, in the form of software and hardware vendors, have seen their profits soar as a result of this investment, and developed the perfect mechanism for milking it for consistent, quarterly results: The Upgrade.

The Upgrade has killed the golden goose. The consistent, repetitive costly upgrade... while padding the bottom line of IT Vendors, has eroded the bottom line of the Corporate World.

Increased expediture, planned and worse, ENFORCED obsolescence, ever-increasing headcounts, etc etc etc.

The CEO's and CFO's have had enough, and they aren't taking it anymore. From their perspective IT is a money pit. An endless drain on financial and human resources.

Ane we are wondering why the tech sector is stagnant at best right now? Technology is immature, yet we kept on praising it as the solution to all problems! Arrogance of our superiority and ignorance of true business needs were the dominant perceptions of your average IT department over the past decade or so. Now is the time for their revenge.

The holders of the purse strings want to see some of that return on investment before they'll spend like that again.

Our profession needs to learn humility, and nothing does that better than a financial ass-kicking.