April proved to be a dismal month for technology sector jobs and overall employment, but there may be a light at the end of the tunnel. Granted, this morning brought sobering news of the U.S. unemployment rate hitting its highest mark since 1983: 8.9%. In the past month, 700,000 jobs were lost in the U.S., bringing the total number of U.S. jobs lost since December, 2007 to 5.7 million in April, 2009. However, while the economy continued to suffer from recessionary conditions over the past month, the pace of layoffs, at least in the tech sector may be decelerating.
According to the TechCrunch Layoff Tracker, tech layoffs reached 330,000 in April, due to layoffs announced by Yahoo (675), Sony Ericsson (2,000), Toshiba (3,900), and Nokia (450) over the past month. Media companies were also hit with layoffs this month with NPR, The Tribune Company, and Conde Nast Digital all forced to implement job cuts. However, according to the numbers, job losses may be slowing down. It only took three weeks for tech layoffs to go from 200,000 to 300,000 in February and five weeks for layoffs to hit the 200,000 mark before that in January. Yet it has taken 11 weeks for layoffs to rise by 30,000, with the layoff tracker hitting 330,515 layoffs today.
We are not completely out of the water yet. Last month, we reported the effects of the recession as measured by tech jobs site Dice.com, and it appears that available tech job listings have dropped even further in April. Dice.com is reporting a 47% year-over-year drop in available technology jobs for April, increasing slightly from a 45% year-over-year drop in March. April’s drop, as reported by Thomas Weisel Partners, is the highest annual drop Dice has seen so far this year, with February’s listings down 40.4% and January’s jobs down 39.3% (all year-over-year). Once again, Dice said that of the ten reported metropolitan areas, Silicon Valley was hit worst, with available tech jobs in the Valley down 54.2% year over year. Chicago (down 54.2%) and Boston (down 52.6%) also posted large declines.
Our own smaller jobs site, CrunchBoard, has also seen a sharp decline in available tech jobs in the past month. A little over year ago 100 – 120 job listings were added to CrunchBoard each month. The number of new listings gradually declined with the onset of the recession and then fell significantly in November 2008, dropping from 68 to 37 listings from the month before. The listings rose slightly over the next few months, with February’s listings hovering around 60. In April, the listings dropped to a low of 35 job postings.
But the Conference Board’s Online Help-wanted Index may show signs of hope in the economy, reporting that monthly job demand dropped 131,000 in April, down 28% year over year, compared to the 31% year over year decline in March. And Challenger, Gray & Christmas released a report yesterday that planned layoff announcements eased in April to 133,000, from 150,000 in March.
Strangely enough, it looks like the fishing, farming and hunting industry has been able to weather the storm better than any other area. According to analyst Christa Quarles from Thomas Weisel, the agriculture, forestry, fishing and hunting industry was the only industry that showed an increase in job vacancies in April. Maybe we are in the wrong industry.
We’ve consistently believed in the resilience of the tech industry, especially given the industry’s past experience with economic downturns. Hopefully, the ease in layoffs is a sign that the tech industry is slowly but surely rebounding in the wake of the economic crisis.
Thomas Weisel Partners LLC is a full service investment bank focused on the growth sectors of the global economy primarily in the Technology, Internet, Media, Telecommunications, Healthcare, Consumer, Energy, Financial Services and Minerals & Mining industries.