East Bay tech jobs melting away

Hundreds of high-tech job losses this year alone are becoming agrim new challenge for a wobbly East Bay economy that's attemptingto stabilize itself.

So far in 2009, employers have shed just under 1,850 jobs in thetechnology or telecommunications sector, according to informationculled from state and regional agencies.

To be sure, technology and telecommunications job losses mightnot boast as much notoriety as the employment devastation unleashedby the implosion of the banking, mortgage and automotive industries.But tech and telecom cutbacks have also jolted the East Bay in asignificant way.

It's possible the jobs lost in the current tech downturn won't beresurrected, even when the economy rebounds, warned David Coursey,an industry analyst and blogger with PC World.

"The number of tech jobs goes up, goes down, and goes up again,but each peak is lower than the previous one," Coursey said.

The heyday of the tech industry in terms of jobs was during theInternet bubble of the late 1990s. That bubble evaporated afterinvestors grew impatient when numerous online startups failed toproduce profits -- and also displayed no evidence they could everget in the black.

"We hit a maximum number of tech jobs during the dot-com boom,"Coursey said. "We might never reach that level of employment again."

Fremont, the closest East Bay city to Silicon Valley, has beenparticularly hard hit by the digital downturn.

During 2009, Fremont has lost 1,076 tech jobs, the laborstatistics show.

San Ramon has the second-highest total this year, losing 229 techor telecom jobs.

The job cuts have influenced some tech companies to jettisontheir expansion plans.

Fremont-based Lam Research had been planning to expand toLivermore and bring that city about 350 jobs. The semiconductorequipment company has leased a two-building complex on the northside of Livermore.

Those expansion plans are off, said Lisa Garber, a Lamspokeswoman.

Lam instead has one of the two buildings up for sublease. Theother building would be used by Lam only as a temporary backup sitein case of an emergency. BNP Paribas Leasing Corp., a unit of a bigFrench bank, paid $36 million for the two buildings in December 2008and landed Lam Research as a tenant.

The downturn has affected parts of the tech business in variedways, according to the state's Employment Development Department.Here's how some sectors of the industry have fared:

-- Computer and electronics manufacturing firms lost 1,500 jobsduring the 12 months that ended in April.

-- Telecommunications companies eliminated 500 jobs.

-- Computer systems design gained 100 jobs.

-- Software added 100 jobs.

Despite the tough times, a number of tech companies have begun toposition themselves for growth.

"We are using this downturn as an opportunity to go into newmarkets," said Paul Meissner, chief executive of Fremont-basedSantur Corp., which is planning a small number of local layoffs. "Weare innovating in our current markets, but we also are innovating innew markets."

Industry watchers believe Silicon Valley will recover, even inthe face of its current travails. Rob Enderle, a San Jose-basedindustry analyst, said the resilient tech industry in the Bay Areaalways seems to reinvent itself.

"The industry will bounce back," Enderle said. "Silicon Valley isnot done. The real problem is whether California is excessivelyhostile to tech companies and it costs them too much to expand hereagain."

Reach George Avalos at 925-977-8477 orgavalos@bayareanewsgroup.com.