Gloom blankets San Francisco

By Bob Keefe, Palm Beach Post Staff Writer

Saturday, April 7, 2001

http://www.gopbi.com/partners/pbpost/epaper/editions/today/news_3.html

SAN FRANCISCO -- The line at the job fair told it all.

Wrapped all the way around the massive Bill Graham Civic Auditorium -- and doubled up at the end because there was no sidewalk left -- unemployed techies by the thousands queued for hours last week just to get in.

Except for the occasional Palm Pilot or cell phone and the neatly pressed Dockers and oxford shirts, it could have been a scene from the Great Depression. "This is crazy. It's organized mayhem," said Skip Antonson, shaking his head and wearing a name tag labeled "Opportunity Seeker."

Antonson, recently laid off from egreetings.com, wasn't pleased by what he saw inside. Applicants lined up 20 and 30 deep just to drop off their résumés at a few dozen employers' booths and get a quick grilling about their experience and how many programming languages they knew.

Oh, how this place has changed -- and so quickly. "Six months ago all you had to say was, `Here's what I can do' and any company would find a way to work you into a job,' " Antonson said. "Now, employers are very picky. They want you to have every kind of tech experience under the sun."

From San Jose to Austin to Atlanta, cities around the country have felt the pain of the technology slump. But with its high concentration of Internet companies, no place has been harder hit than San Francisco. "San Francisco is the epicenter," said John Challenger, whose Challenger, Gray and Christmas Inc. outplacement firm tracks layoffs nationwide. "San Francisco in many ways typified the new energy, the new vision embodied by dot-coms. This is a real blow to the spirit of that city."

An estimated 25,000 Internet workers have lost their jobs in Silicon Valley and the San Francisco Bay area in the past 15 months, according to a study by real estate researcher Rosen Consulting Group. Mostly because of the technology job cuts, California had more layoffs than any other state in the first quarter of this year.

It isn't expected to get much better. As many as 18,200 more Internet workers are expected to lose their jobs here later this year, and in the end about 80 percent of the local dot-com companies will die, Rosen predicts. As a result, the San Francisco Bay area will likely slip into a recession in the next few months, according to a study released last week by economic forecasters at the University of California, Los Angeles.

"It almost feels like . . . we're being punished for something," said Byron Gordon, 33, who lost his job at Web company iplace.com last month. "The party days are gone."

A real-estate reversal

The dot-com demise has hit this city like a neutron bomb. People are gone, and buildings remain. Warehouses that were converted into high-tech office space now sit empty in "Multimedia Gulch," not unlike the empty knitting mills left scattered through the South by the unraveling of the U.S. textile industry.

The amount of vacant office space in the area has gone from virtually zero to more than 16 percent, while rental rates have dropped 24 percent to about $55 a square foot, according to Rosen Consulting. Just six months ago, some San Franciscans were fighting to keep dot-com companies from taking over the area south of downtown because they were gobbling up too much space and causing rents to soar. Now, "they're evaporating as if they were never there," said consultant Ken Rosen.

At night spots where a year ago you could find techies toasting their latest round of venture-capital funding, there are only "pink slip parties" where out-of-work dot-commers commiserate and look for job leads. Group therapy is in vogue. Support groups for laid-off Internet employees are popping up in coffee shops and unemployed workers' homes.

Hollie Gregory moved from Cleveland, Tenn., to San Francisco to go to law school, but dropped out to join an Internet software company last September. Four months later, her job was eliminated. She has been hunting for work ever since. Recently, she posted a notice on a local Internet site seeking other laid-off women to form a support group. Within 10 minutes she had her first response, and has had dozens since then.

"I wanted to be creative, to do something positive," said Gregory, 25. "And I really need to be surrounded by other people in my same position." It was people like Gregory -- smart, ambitious 20-somethings -- who built a community around San Francisco's dot-coms, one accentuated by trendy parties, good pay and a flavor of something revolutionary.

"Everybody wanted to believe in it. Everybody thought, `Wow, I don't have to work 9 to 5 at IBM or Wells Fargo," said Gordon, who also worked at pets.com, perhaps the most-cited example of Internet failure. "But in the end, it was like it was smoke and mirrors."

What makes the layoffs even harder for many here is the fact that San Francisco is so likeable. The Rust Belt's decline drove many blue-collar workers to other parts of the country, but fewer want to leave the diversity, the activities and the weather that have made this city famous.

Gregory, for example, is working temporary jobs to pay the rent while searching for a full-time position. She thinks she can hold out for another few months before she has to consider moving. "I don't want to go back to the South," she said.

Some gain from the pain

The problem facing many unemployed dot-commers is simply one of supply and demand: In contrast to a year ago, there's now a great supply of similarly skilled high-tech workers, and a dwindling demand for them at a declining number of high-tech companies. The Federal Reserve Bank of San Francisco, for instance, is getting 50 to 100 applications for every opening it has, said recruiter Terry Killian.

A year ago, with dot-coms offering stock options and high salaries, applicants for any job there were few. "We're spending the better part of every morning just opening e-mails from job seekers," Killian said. "There are a lot of people coming from the dot-coms looking for something more stable, more dependable."

Meanwhile, for many in the San Francisco Bay area who stayed on the sidelines during the dizzying dot-com boom, the bust is giving them reason to scoff. "I just laughed at the whole dot-com thing," said Roger Nelson, who has been in the graphic design business in nearby Emeryville since 1991. "You only get to do this kind of work more than once if you have something that makes money."

A good thing to come out of the bust for Nelson: expensive furniture at fire sale prices. "I'm getting faxes all the time for good deals on Herman Miller chairs," he said.

bkeefe@coxnews.com

-- Swissrose (cellier3@mindspring.com), April 07, 2001

Answers

A few years back, Sen Spencer Abraham (now Bush's Energy Czar) pushed through legislation to open up our borders to high tech workers. He claimed their was a shortage. I was unemployed at the time and I can assure you there was no shortage. Abraham was not interested in increasing the number of high tech workers, he wanted to drive down their salaries.

No with the dot com demise the market is flooded and the flood gates remain open. This is just another case of the gevernment meddling in things it has no knowledge of.

Spence is certain to bungle energy policy equally well. He, like most politicians is qualified to be a hot air bag and nothing more, yet they blindly go about thinking they a experts on everything.

Their is nothing more dangerous than a government overflowing with no- it-all, no-nothings.

-- Tom Flook (tflook@earthlink.net), April 08, 2001.