

Is the tech recession over? - rayvega
http://www.joelonsoftware.com/items/2009/02/11.html

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illumen
Is the tech recession over? In AU, and UK... Yes. According to various job
places, there has been an increase in jobs. A low point was of course
September, and October... but things have increased since then. Even newspaper
classifies for jobs are on the up. Also the number of client requests for new
projects has gone up for software developers/designers/advertisers/marketers I
know.

I don't really track USA places - so I can't comment on them.

Is this Joel on Software post another thinly veiled advertisement for their
services? Yes.

~~~
beamso
In AU I'm seeing less jobs advertised on Seek than late last year.

~~~
whatusername
[http://business.theage.com.au/business/surprise-jobs-
jump-20...](http://business.theage.com.au/business/surprise-jobs-
jump-20090212-85cg.html) "Employers took on an additional 33,700 full-time
employees in January, the most in six months, spurring hopes the economy may
yet avoid a recession.

All up, the economy added 1200 jobs last month as firms cut part-time jobs.
Even so, the result was much better than the overall 18,000 job losses
economists had tipped."

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ardit33
Yes. Well, at least the panic is over, and some companies are hiring
cautiously.

I got three job inquiries last two days, from recruiters and: I got another
request from a startup that I got an offer in October, that week that Sequoia
send the RIP presentation. They had to withdraw the offer, b/c of a hiring
freeze mandated by the board. It seems that they are hiring again, and
contacted me if I was still available.

I am not, as I found a new job in a same size startup.

Basically, if you are really good, you will be able to find a job. I might
take some time, but there is some hiring going on. The only thing is that
there is a lot of people laid off, so there is a lot of competition out there,
and some interviews will end up like an "american idol" contest, but be
patient and don't get discouraged.

In another anecdote, mobile seems to be a field that is still hiring. A friend
of mine was laid off in December, but he was able to find contracting work
within 3-4 weeks.

I think this recession will probably drive some subpar talent out of the
industry, which I think it is a good thing.

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mtkd
It has hardly even started yet.

Many tech companies have been insulated as they were funded (therefore not
relying on revenue for survival).

There will be no new funds for many of these companies - so they need revenue
- and they have to achieve revenue in a contracting economy.

I had hoped we'd see an uptick in activity in H2 2009, but I fear it's going
to 2010 or 2011 before we start to see real recovery - the history of the
1930s indicates it may be even later than that. Many economists are saying
comparisons with 1930s are wrong, which could be true, but in the 1930s the
economies outside the US were unaffected and exports to those economies
dragged the US out of depression - this time it's global.

It's possible we will see some fake recoveries, some may last a year or so,
but the problems this time are so vast it's going to take many years to heal.

These massive spending measures that are being put in place all have
consequences and we've got to deal with those before we get back to stable
growth.

Some companies, for instance those doing business apps that save money, will
be counter cyclical and may do well. For the rest it's going to be hard times.

~~~
bwd
"...in the 1930s the economies outside the US were unaffected"

Perhaps you should read the Wikipedia article on the great depression paying
careful attention to the section on effects:
<http://en.wikipedia.org/wiki/The_great_depression#Effects>.

"...and exports to those economies dragged the US out of depression"

If by "exports" you mean all the bullets and bombs and tanks and so forth that
the US sent out to blow up everybody else's stuff, then I agree with this
statement. You also need to include all the stuff that was then sent over to
rebuild that blown up stuff to account for why the depression didn't continue
after the war was over.

On the other hand, I heartily agree with your statement that today's problems
are vast and that it may take years to heal. It's going to be painful to
reduce production now that people will not be able to continue to borrow to
fund lifestyles that are beyond their means. It will be even more painful when
everybody figures out that the government can't do the same.

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tptacek
No. Most of the drama hit in September, 2008. It takes an F500 significantly
more than one month to react to the downturn. In our case, we predicted we'd
see budget contractions and RIF's in Q1-Q2 as '09 budgets were slashed and
revenue recognition results started bleeding into companies, and that's
roughly what we're seeing.

~~~
illumen
So your answer is Yes, but soon it will be No?

~~~
tptacek
I don't want to get too specific, but we're _already_ seeing signs of cost-
cutting --- particularly hiring freezes and loss of open headcount, and in
sharp capex restrictions. There's no "Yes" interpretation, since we're saying
the bad stuff hasn't really started happening yet.

To believe that a tech recession peaked in September and is now past us, don't
you have to believe that thousands of massive companies absorbed the Lehman
Brothers and AIG shock nearly instantly?

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psadauskas
It never really happened here (Boulder, CO). A couple of the big guys with
offices here (Sun, IBM) laid off a few hundred, and all the engineers and tech
guys were snatched up immediately. We've been looking to hire for 6 months,
and have yet to find any decent candidates in the area.

There's lots of startups here always hiring, and large government labs to fall
back on.

~~~
rrival
Were you in Denver/Boulder in 2003?

~~~
psadauskas
No, I moved here in 2006.

------
bd
I have some more datapoints from jobs aggregated on Joblighted (24 sites):

<http://joblighted.com/statistics>

There were indeed more jobs posted in January 2009. Though probably much of
this increase is cyclical. In two previous years there was the same pattern -
a decline in December followed by an increase in January.

<http://joblighted.com/img/jobs_Sep2006_Feb2009_monthly.png>

<http://joblighted.com/img/jobs_Sep2006_Feb2009_weekly.png>

(Please note that I kept adding job sites, which could hide some of the
decline in job postings).

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adamc
I don't think it is over, because many organizations are only starting to cut
back. Not everybody was hurt initially, but the effects are gradually
spreading throughout the economy. It seems likely that this will result in a
drop of IT spending.

Certain products may do well, though, if they look likely to save companies
money. Maybe that's what happened to Joel.

~~~
nihilocrat
Yeah, I tend to spend all my days in code and thus don't have a clear idea of
how the video game industry is doing, but I haven't heard anything about
people lifting their hiring freezes, and it seems like there's a new studio
that shuts down or cuts jobs every few weeks.

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z3r0p4r4d0x
Never knew recessions are indicated using Joel Spolsky's product sales.

~~~
ConradHex
From the article:

"OK, it’s just one data point. All I know is sales of FogBugz and Copilot."

"This could be a fluke; it might not reflect any reality."

I think it's very informative for them to share (relative) sales numbers like
this.

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llimllib
hmmm... what would be weird would be if people tended to exhibit herd
behavior, and go to the restaurants that have the most people because they
_must_ be the best ones.

If that were the case, Joel would have a financial incentive to claim that
people were buying his software just as much today. I mean, especially if he
were super savvy at marketing his software on his blog. hmm...

~~~
ConradHex
Could be. Or maybe he's just telling the truth. Do you have evidence of Joel
being dishonest before? His blog doesn't feel like it is, to me.

~~~
llimllib
I didn't claim that he wasn't telling the truth.

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geebee
My initial reaction would be "of course not". When the rest of the economy is
in a tailspin, why would tech somehow be different?

But here's the thing - we (the tech world) took a brutal recession in the
early 2000s to shake off the excesses of the dot com bubble. Many people
believe that Fed managed to avoid the dot com bubble reckoning by creating a
new, and even more dangerous, bubble in housing.

It did seem that way. While hundreds of thousands of people (including good
programmers) lost their jobs, housing prices kept climbing, and consumer
spending kept humming along, even increasing.

So in some ways, I wonder if maybe the rest of the economy is experiencing the
reckoning that tech has already been through.

I have trouble believing that high tech won't be negatively affected by the
economic troubles, but it may be much better off than other sectors of the
economy.

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tallanvor
No, at least I do not believe the recession is over in the tech industry, but
some companies are better positioned than others to do well right now.

Companies like Fog Creek could actually do very well, because people buy their
products to streamline processes and improve productivity. --Exactly what
companies need when they lay people off or slow hiring.

While we're doing better than most other industries, we've still seen more
jobs lost due to the economy than new jobs being posted. I do agree, though,
that the really good people will generally still be able to find work,
although not necessarily as quickly as they once would have.

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sown
I think that anything that would save money would be OK. I work for a certain,
very large SaaS company that saves companies on certain expenses (for real!)
and we've seem to seen an uptick in business.

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tristian
This could be an attempt by companies to become more efficient by replacing
positions in HR and Support with software solutions.

So while this might be representative of the SaaS industry I strongly doubt
that it would represent the tech situation as a whole.

Actually I think the tech sector is going to be slowly winding down for quite
a while to come. There were lots of big contracts locked in before the
recession hit, and that existing work is going be finished off over the next
year without much to replace it.

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bmj
We weathered a nearly four quarter long downturn that ended in Q3 of 2008.
Sales have been brisk since, and the pipeline looks good. We haven't attempted
to fill positions that were removed during that downturn, however.

Other tech companies in the area are hiring, though certainly not at the brisk
rate they once were. The only active layoffs I've heard about are in the
financial sector.

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thinkcomp
No.

