So the Semiconductor Industry Association assures us that 6.5 percent growth worldwide in the first half of the year is prima facie evidence of an economy that's firing on all cylinders. If so, this is a mighty funny boom. At backyard barbecues and graduation parties this summer, I'm hearing the same complaints from engineers at Agilent, Atmel, Hewlett-Packard, Intel, Quantum and scores of similar companies with Colorado operations: Projects are being consolidated and workers axed. Large divisional-headquarters buildings stand virtually empty, telecommuting falling short as an explanation for the dearth of occupants. Too many tasks assigned to too few bodies means projects go unfinished or are shabbily done. The sense of fun and adventure has been extinguished by Sarbanes-Oxley, overwork and uncaring bosses.
The general press reports the large layoffs at Sun or HP and sees a net loss, but in many vertical realms, the jobs lost to a layoff at one company are replaced by another company's stateside hiring for a new division Agere's new storage efforts in Longmont, Colo., for example. But just because net job loss is minimal does not mean work quality hasn't changed.
When back-end design and verification functions go to India or China, more and more U.S. engineers end up becoming de facto managers and trying to coordinate a global design team can take you out of the direct design effort. Many engineers who get tired of such bureaucracy move into various service-industry or civil-engineering projects and are never counted again among technology employees the "hidden unemployed," as it were.
And let's face it: In terms of both the employee and the customer bases, attention has turned to Asia. The United States is becoming the de facto tech backwater that telecom OEMs two years ago warned it would. It was no accident that Texas Instruments chairman Tom Engibous made his single-chip cellular-phone call from India on Aug. 8. Who says tech demos have to come from Dallas?
This message is not lost on the venture capital community. Since mid-2004, we have seen the return of venture rounds that exceed $10 million, but with an important difference from the insanity of the late 1990s. It goes without saying that VCs demand Sarbanes-Oxley accountability in the postcrash environment, but they also demand something else. If a business plan calls for all U.S.-based workers, it will not get funded. The assumption indeed, the template that VCs apply today is that U.S. employees will be limited to a handful of management and G&A types, with the rest of the team hailing from Bangalore or Guangzhou.
Savvy companies are finding that there are alternative routes to getting funded today. Later this summer, EE Times will explore the new influence of private-equity syndicates and hedge funds. This is an avenue for bringing in new employees and expanding operations, without the specificity in management templates that are now demanded by venture capital.
But strong equity availability could hamper transparency. The fast evaporation of the hedge fund Long Term Capital Management in 1998 should serve as a warning: When equity operates invisibly, without the accountability of the public market or VC funds, it can disappear faster than ice cream on a summer sidewalk.
There are no easy answers to the inevitable shift of leading-edge indicators to Asia. Here's hoping U.S. technology employees will have smoother sailing than workers in Europe have had. But as the industry ponders whether the change in job description for the American design engineer is tolerable, the boom of 2005 doesn't feel anywhere near as blazing hot as coast-to-coast weather trends.
By Loring Wirbel, Communications editorial director for EE Times and its network publications