just a little grumble

[Matt Alexander]

My impression is that the economy grew extremely fast due almost entirely
to the computer hardware/software industry.  Obviously, many non-tech
companies also benefit from the tech industry doing well since there's a
lot of services and goods needed to support the growth of the tech
industry.  There were several factors that I see that led to such a huge
expansion of tech jobs and high salaries, and all of these factors
coincided at about the same time.

Y2K:  There was a lot of money spent upgrading hardware and software.
There was also a lot of money spent on consultants and other support
companies to facilitate the upgrade.  Many systems were upgraded even
though they were already Y2K compliant, just to bring everything up to the
same performance level.

The Internet:  Every commercial a couple years back had a URL splashed on
the screen.  Nearly everyone thought that the Internet was going to be
this amazing thing that revolutionized the world.  Everyone thought they
could make a ton of money by simply selling their product over the web.
Everyone that didn't already have a computer thought that they needed to
get a computer so they too could do whatever it was that everyone else was
doing on the Internet.  So what does Joe User do with his fancy computer
and Internet access?  He reads and writes email.  Maybe if he's really
advanced then he checks movie times or the latest sport scores on the Web.
Woopteedoo.  Before you try to flame me on this point, realize that you
are not "Joe User." You're on a Linux mailing list and that puts you far,
far outside the average.
Probably the most useful feature of the web to me is that I can easily
make plane reservations (not that I can afford to travel anymore like I
did during the dotcom days, but that's beside the point).  So there have
been some nice benefits, but hardly anything earth-shattering.

Hardware performance:  Several years ago you could go into a computer
store, take a computer home and actually notice some difference in the
performance compared your old system.  So let's say Joe User buys the
latest and greatest Pentium 933 THz computer.  Does he notice any big
difference in how his apps run from his old 350MHz system?  Nope.  Not
unless he plays a lot of games.  So for almost every software category
except games, the hardware has vastly exceeded the demands of the
software.  Computer hardware is now become a commodity and the profit
margins are next to nothing.  The server market is somewhat different, but
it's quickly being marginalized as well as the performance from relatively
cheap Intel chips continues to increase and push the more expensive
players, such as Sun, into an ultra high-end niche market.

There are a lot of other minor contributors as well, such as money being
invested in companies with no good business plan.  There was also an
extreme waste of money during the dotcom days of a year or two ago.  I
worked for two companies that would spend exorbitant amounts of money
on all sorts of unnecessary purchases, all because they thought that their
pot of gold would never run out.

I'm going to really exaggerate and overgeneralize things here and say that
no one buys software anymore (except games).  Have you been to an Office
Depot lately to see the software choices?  Almost nothing of interest.  MS
Office, while a fine product, is horrendously expensive if you didn't
already get it for free with your computer (or swiped a copy from work).
So the software industry is pretty much dead, in my opinion.
Microsoft will probably be one of a handful of software companies still
standing in the next several years.  Not because they make good software,
but because they're big enough and wealthy enough to survive longer than
the rest.  But they too will have to soon make dramatic cuts in their
workforce to survive.  They're losing money on X-box and customers aren't
interested in upgrading their MS software (and probably couldn't afford it
anyway) anymore.  Microsoft is sort of a macro-example of what we're going
through.  They too were in the right place at the right time and made
several business choices that brought them to this point.  But they can't
keep up the same levels of financial growth any longer.  And there will
never be another Microsoft because the factors that brought them where
they are now won't happen again as far as I can tell.

So where'd all those computer jobs go?  They were never really there.
It's not the fault of our government or anyone else for running the
economy into the ground.  We're in a recession.  And we'll continue to be
in a recession until things return to the levels they were before Y2K, The
Internet, and Hardware blew things way out of proportion.  It was a bubble
of extreme wealth where a lot of things happened together at the right
time, but it's over now.

In any case, I wish everyone that's been laid-off (including myself) the
best of luck finding a new job.  You might seriously look at going back to
school to try your hand at a different profession.  Right now there are
too many people looking for tech jobs and there will most likely never be
enough jobs to satisfy them all.
~M



On Tue, 4 Dec 2001, Nancy Sollars wrote:

> Hi Guys,
>
> Well looks like this down turn in economy has bitten once more ... Ive just had a nice chat with my wife and it seems the only choice ive got is to go and get a job at a fast food restuarant ..
>
>
> not being funny but i could have dont this back in Bristol.. Since the economy in the US at the moment sucks so bad im seriously considering going back to the UK,  I think someone up top should get a reality check and start reading their book on how to run a country cause im sure im not the only one being driven to such extremes.
>
> With all my experiance and stuff in IT there is no way in hell im going to flip burgers it would make no sense of the money and effort spent on training and courses by myself back in the UK.
>
> How do you all feel about the current situation?
>
> Nige
>