Sunday, June 7, 2009


It looks like we’re still in for a rough employment road here in the Bay Area. I speak to hiring decision makers, employees, and job seekers every day. I still hear a lot of talk about overhead cuts, hiring freezes, redundancy, and lay-offs.

I feel like we’re currently experiencing the transactional stage of the economic downturn. Financially weaker companies are struggling to drive revenue, so they still need to cut more overhead. They also end up being acquisition targets, or may merge with other companies in order to survive. All three of these scenarios lead to a continually tough job market.

Larger companies with cash are looking for acquisition deals. When these transactions occur, inevitability there will be redundancy, and more lay offs. It’s probably going to take awhile for this transactional period to shake out. We’re going to have to hang in there and stick it out.

Though this reality may be difficult for many, looking at it more positively, this type of activity represents a transformation of the Bay Area marketplace. Transactions will create new companies; new products will be invented; new entrepreneurs will take risks, and new jobs will be created.

As we spoke about in previous entries, our local economy will be changing over the next year, whether we like it or not. Companies will fail, be sold, merge, or move; jobs will be eliminated. At the same time, new opportunities will arise. The marketplace for the next decade is under construction. Our job is to hang in there and be ready to role with what new opportunities come our way.

--Steve Hernandez