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SAN FRANCISCO - 09/27/04 - Silicon Valley - the Promised Land of the high-tech industry - won't see an employment boom reaching the level last seen during the fabled Internet Boom of the 1990s until 2010, according to a new industry forecast released recently by The Silicon Valley Manufacturing Group (SVMG).
 
Silicon Valley - centered on San Jose, just south of San Francisco, and home to many of the best-known US technology companies - boasted 1.57 million tech-related jobs in 2000, reflecting torrid demand at the time for software, information technology gear, semiconductors, and telecommunications and networking equipment.

But over the last four years, the region has lost more than 210,000 jobs "as the result of the sharp and long downturn in technology goods and services," the forecast said.

According to the report, the losses "figured prominently in California's budget troubles in recent years."

Income and capital gains taxes from Silicon Valley provided the state with a huge reservoir of funds to expand legislative spending, but those revenues dried up as stock values plunged, leaving the state with commitments it could not meet, it said, adding the tech slump "is over and signs of a recovery in their area are emerging after three years of job losses."

However, the recovery will be slow, the group said.

"It's a gradual climb rather than a steep ascent," said SVMG President Carl Guardino, commenting on the pace of the region's expected recovery.

"In a way, that's healthier because we have more time to plan the infrastructure," he said. "But it's hard to tell 212,000 people who lost their jobs over three years in Silicon Valley that things are getting better."

The group expects area payrolls next year to expand by 30,000 jobs, bringing local employment to about 1.39 million.

Strong exports are helping the region's output and production could get a further boost as US-based companies start to reinvest in technology, say analysts.
 
"Made-in-California merchandise has really come around," said Howard Roth, chief economist at the State of California's Department of Finance.
 
"We're still not seeing much in the way of job growth...but the losses have subsided," he said.

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