High-Tech Job Cuts Slowed to 2 Percent in First-Half 2009

By September 24, 2009

Between June 2008 and June 2009, 224,100 high-tech jobs were cut, representing 3.7 percent of the workforce, but in the first six months of this year job loss has slowed to 2 percent, according to a report by the TechAmerica Foundation using data from the U.S. Bureau of Labor Statistics (BLS). Overall, high-tech job loss was lower than the national average of 5.1 percent across all industries for the year. In the first half of this year alone, between January and June, 115,000 jobs were cut, and tech losses now outpace the private sector, though high-tech decline slowed to 2 percent from January to June 2009.

While tech employment continued to decline is the first six months of this year, overall US employment perhaps grew, albeit by a slim 0.2 percent (the BLS doesn’t make seasonal adjustments for labor data, so it is possible that figures from contrary sources, which indicate that 2.6 million private-sector jobs were cut in that period, may be closer to the truth).

As of June 2009, 5.81 million people are employed in US high-tech positions. At its height in August 2008, the industry employed 6.05 million.

The biggest hit came in January 2009, when 66,600 high-tech jobs were shed. Between February and May, job cuts averaged around 28,500 per month. This trend abruptly halted in June, when there was an 700 person increase in employment, the first gain since last October.

The hardest-hit high-tech sector was technology manufacturing, which suffered an 8.8 percent decline in employment between June 2008 and June 2009. Technology service providers – which includes communications services, software services, and engineering and tech services – cut 2.7 percent of their workforce during that period.

"The tech industry has suffered the full force of the global economic recession in the first half of this year, yet we believe it has weathered the storm better than most," said TechAmerica Foundation President Christopher W. Hansen.

"Given that technology is an important economic driver, long-term investments and globally competitive tax policies are critical for encouraging technology companies to form and flourish in the United States and add new American jobs," Hansen said.

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