A visitor from northern California and I were walking around downtown Austin on a recent evening. We looked up to the top of a new building under construction on Congress Avenue, a mighty edifice that will be Austin's largest office building. At the top, a workman was welding, and the sparks made for a beautiful sight.

"There seems to be a lot of construction going on here," my friend said. He is correct. Three hotels are being built around the expanded convention center, and upscale "loft" buildings are being finished, aimed at wealthy Texans. Many of these projects were started during the bust by risk-taking investors betting on Austin's recovery. Certainly the long-term projections are for Austin to become one of the top dozen U.S. metropolitan centers.

But darned if I can find much optimism among people in the tech sector. Motorola is still cutting jobs, as the new head of the Semiconductor Products Sector, Scott Anderson, discovers redundancies among the many wireless-chip design centers that Moto operates.

Dell is gaining market share, but the hiring is outside of Austin as the company moves operations to India, the Philippines and China. A laid-off Dell employee said that as an unemployed worker, she hates the outsourcing by Dell, but as a Dell stockholder, she applauds the company's bottom-line focus.

AMD and IBM employ several thousand people in Austin, but they too are struggling to maintain their Austin payrolls. In the chip sector, Silicon Laboratories is the only company that is still accelerating, though SigmaTel launched an IPO that may bring in $120 million in capital for the audio-chip vendor.

National Instruments, and Motorola's Metrowerks subsidiary, are thriving, largely because the users of LabView and Code Warrior provide a varied customer base.

Others are not doing as well. Legerity is sputtering, caught by the lull in voice-over-broadband. Perhaps when the Docsis 2.0 standard is established in the market next year, Legerity will grow again. Cirrus Logic is hoping for a rebound, citing design wins among the recordable-DVD vendors and prices under $300 by Christmas for DVD-R.

So, where's the rebound? The consensus here is that it may be two or three years before the sparks start flying again in terms of engineering employment in Austin.

David Lammers covers SoC process equipment. Contact him at dlammers@cmp.com.