January 10, 1999 — Reprinted From: San Francisco Examiner Career Search

Less of the Same

By Dave Murphy

Both in the Bay Area and nationwide, 1999 is expected to be another year of economic boom - lots of jobs exploding onto the scene, lots of people getting blown out of work.

"The economy in the Bay Area will continue to remain strong" Michael Reid of Michael James Reid & Company, a San Francisco management consulting firm. "The entrepreneurs in early stage companies will continue to have access to millions of dollars of venture capital."

Reid says that in the quarter ending Sept. 30, venture capitalists spent $1.2 Billion in the Silicon Valley - one third of all the venture capital spent in the United States.

But with all the investment comes a down side. Investors in startups and public companies aren't as patient and tolerant as they used to be.

"Wall Street today puts tremendous pressure on companies to meet high earnings targets," says John Challenger, executive vice president of the international outplacement firm of Challenger, Gray & Christmas Inc. " There's nothing that's going to stop that train now unless it's legislative."

Challenger says that if the Stock Market continues to be strong, companies are likely to continue merging, which will lead to layoffs - as it did last year, which had a decade high 677,795 job outs. He adds that if electronic commerce keeps thriving, people in such industries as retail, travel and finical services will be "at risk."

And, despite a generally optimistic outlook, Challenger says that there is still the chance that United States will suffer from the economic crisis in Asia. "I don't think we've hit the end of that yet."

Reid adds that Internet-related companies will be long term winners, but careers in that industry are hardly secure, "If the stock market drops and stays down, it will affect the people in those companies."

Soon-to-be college graduates probably won't see the frenzied recruiting of last spring, but the market appears strong despite a slowing economy.

"This year, students may be coming up with three offers instead of four or five, but I still think it's going to be a very strong market," said Steve Pollock, cofounder of Wet Feet Press, a San Francisco publisher of guides for job seekers.

The annual fall recruiting survey by the National Association of Colleges and Employers shows a 10 percent increase in hiring projections overall. That's only half the 19 percent increase in demand between spring 1997 and 1998, but healthy nonetheless. Hiring projections for west coast electronics manufacturers are way down, and most regions are reporting smaller increases in demand than last year. Still, starting salaries are expected to increase by a respectable 4.8 percent average.

One big change: Recruiters have started a trend of appearing on campus earlier, extending offers sooner in the senior year and pressing students to accept early in some cases by offering larger signing bonuses to those who make up their minds in the fall.

For all levels of experience, people with skills in information technology and the health sciences are again expected to get lots of job offers. Chief information officers are optimistic about IT hiring in the first quarter of 1999, according to the quarterly Information Technology Hiring Index done by HI Consulting of men park.

Of the 1,400 information officers surveyed, 27 percent anticipated hiring additional IT personnel in the next three months and just 1 percent foresee staff reductions. The resulting net 26 percent increase in hiring is up two points from the previous quarter.

"Companies will be allocating considerable personnel and finical resources to IT initiatives including completion of the Year 2000 projects," says Greg Scileppi, executive director of RHI consulting. "Consequently, demand remains strong for technology workers at all levels."

Challenger says high-tech companies do have positions for people who don't really think of themselves as techies. Jobs developing web sites, for example, often have more to do with making the site attractive and useful rather than heavy duty programming.

"Even database management - it's less that you need to be a techie in terms of programming," Challenger says . "You need to know what programs companies are using."

About the only weak job areas he sees in high-tech is for data entry-workers, who are gradually getting replaced with voice recognition technology and scanners.

Reid says that biotechnology will continue to be hot in the Bay Area, the U.S. Leader with about 500 companies based here. He expects health care workers , including doctors, nurses, physical therapists and home care providers, to have strong prospects for years to come because of the aging baby boomers.

Financial services will be a mixed bag, as both Reid and Challenger expect banking jobs to be in jeopardy because of mergers. Reid expects growth in mortgage brokerages, investment companies, insurance and real estate. Challenger says traditional stock brokerages could have trouble because of the Internet, but he expects financial planners in general to thrive because of the baby boomers.

Reid expects employee retention to be a key issue in 1999 and beyond, as employers are realizing how much their business suffers when they lose key people. He expects more emphasis on elder care, flex time and tac-advantage education programs as a way to keep older workers who might otherwise be tempted to retire.

In a move to keep Generation Xers, Reid expects companies to emphasize training so the workers can keep adding skills.

The Dallas Morning News contributed to this report.