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Tech companies finding it slow to reboot, report says
03/15/02
Alison Grant
Plain Dealer Reporter
Tech-related jobs - particularly those in telecommunications - are not sharing in the economic recovery.
Companies did away with 61,000 telecom jobs in January and February, and other tech-sector companies cut 24,000 more, according to a report yesterday by the outplacement firm Challenger, Gray & Christmas.
"Overcapacity, a glut of competitors and a lack of capital spending by companies on new networking and telecommunications equipment are making it difficult for even the strongest companies to avoid the turmoil," Chief Executive John Challenger said.
The report came on the heels of warnings of reduced earnings by equipment manufacturer Lucent Technologies Inc. and cell phone maker Nokia, and confirms that the worst may still be ahead for the tech domain.
The only areas showing much sign of health are e-commerce and computers, where jobs cuts are slowing. In computers, for example, employers have announced plans to cut 11,400 jobs so far this year.
The number of job cuts is down 30 percent from the 16,200 cuts announced as the tech market tumbled in early 2001.
In Northeast Ohio, tech companies are gradually steadying themselves, said J. Pari Sabety, director of the Ohio Supercomputer Center.
"We are seeing somewhat of the plateau," she said. "As the telecom sector goes, one cannot automatically conclude that that's how the remaining part of the tech sector will go."
Some firms said they have turned the corner.
"It's small baby steps," said Keith Jordan, business manager for LogiSync Corp. "We've noticed it every month since November." The Westlake software maker expects to expand its staff of 10 in the second quarter.
Fathom Interactive Solutions of Cleveland, an e-business design and consulting firm, chopped its work force from 40 to 18 when the tech sector fell. Now it is back up to 28 employees, with plans to hire several more, as well as two or three summer interns.
"I wouldn't go overboard saying it's on the mend," said Ron Copfer, president. "It's holding steady."
Copfer is also chairman of the Northeast Ohio Software Association, which found in an October survey that the region could yield some 16,500 information technology job openings this year. About half are expected to be "churn," replacement hires for existing positions.
Contact Alison Grant at:
agrant@plaind.com, 216-999-4758 |
