Silicon Valley CEOs braced for tough year
The normally upbeat chief executives of Silicon Valley are worrying about the economic damage and job loss this year could bring, according to a survey by the Silicon Valley Leadership Group. — The advocacy group's annual business climate survey …
Context & Ripple Effects
The mood check lands on top of a grim run of local data: GigaOM's February look at job losses through a Silicon Valley lens was followed within weeks by the Mercury News report that regional unemployment had jumped to a 'frightening' 9.4 percent. Against that backdrop, the Silicon Valley Leadership Group's annual business climate survey is notable less for its findings than for who is delivering them — the region's own cheerleaders-in-chief.
The counterpoint already circulating in the press is USA Today's argument that new tech start-ups can rise from the economy's ashes, which frames the CEO pessimism as cyclical rather than structural. The Leadership Group, as the valley's principal advocacy organization, now has a data point it can carry into Sacramento when arguing for policy relief.
First-order effects
- Silicon Valley CEOs are signaling a shift from expansion messaging to damage control on jobs, giving the Leadership Group a concrete mandate for its advocacy work this year.
Second-order effects
- With unemployment at 9.4 percent as of March and executives publicly bracing for more cuts, employers that hold headcount flat gain a recruiting and reputational edge over peers still trimming.
Third-order effects
- If the pattern holds, annual business-climate surveys from regional advocacy groups harden into the valley's de facto early-warning indicator, shaping state policy attention before official employment statistics catch up.
The trend: Regional business-advocacy sentiment surveys are becoming leading indicators of tech-sector labor stress, with executive pessimism in 2009 tracking ahead of official unemployment readings.