Friday, May 13, 2005

Bay Area job market to grow -39 percent of the businesses it surveyed intended to hire staff in the next six months

Posted on Fri, May. 13, 2005

Bay Area job market to grow

By George Avalos


The Bay Area in recent years has been the worst of the worst of the nation's metropolitan labor markets, but employment in the battered region may be ready to climb out of the cellar.

Employers in the nine-county region have intensified their hiring plans to the highest levels in years, according to a survey of businesses in the Bay Area that was released today.

The Bay Area Council quarterly update found that 39 percent of the businesses it surveyed intended to hire staff in the next six months and just 7 percent intended to reduce staff. About half of the respondents said they planned to keep their staff levels the same. Especially heartening was the revelation in the survey that 27 percent of the big businesses -- those with more than 10,000 employees -- intended to hire people in the next six months.

"Quarter after quarter, our survey found that big companies were downsizing," said Jim Wunderman, president of the Bay Area Council. "Now, we are finally seeing more growing than shrinking. That's good news for people who are looking for a job and want to work at a big company tomorrow."

A hefty leap in hiring would be a welcome reversal of the misfortunes that have hammered the Bay Area job market in recent years.

Since employment peaked roughly four years ago in March 2001, employers in the Bay Area have jettisoned nearly 396,000 jobs, including a loss of 44,000 in the East Bay. Improvement in the regional job market has emerged only recently: Over the last year, Bay Area employers have added 7,100 jobs, including 3,900 in the East Bay.

Livermore-based FormFactor Inc. is among those seeking new employees. The maker of semiconductor equipment has 25 openings, including 23 at its Livermore headquarters and two in Japan.

"We continue to seek qualified engineers, marketing and other resources to enable us to accommodate our long-term growth objectives," said Joe Bronson, FormFactor's president.

The company, with more than 600 workers, posted an 80 percent gain in revenue in 2004. FormFactor opened a new headquarters complex in east Livermore in 2004.

"FormFactor's growth will continue this year," Bronson said.

Small companies also may jump onto the hiring bandwagon. Kevin Farnham is the principal executive of two small San Francisco companies that design and produce logos, retail interiors and Internet sites. Each company has about 20 employees and expects to expand its work force by 25 to 50 percent by adding five to 10 employees apiece.

"Design services are the first to go in a down economy," Farnham said. "As times get better, those kinds of services come back."

Farnham's company has clients all over the Bay Area and around the country. Some firms that simply hunkered down during the economic slump are starting to create again, he said.

"We're starting to see a little more experimentation taking place," Farnham said. "People are doing things they literally hadn't done before. It's an exciting time for us."

The survey did contain a minor unsettling note. An index that measures overall business confidence came in at a value of 59, which indicates continued economic expansion but at a slower pace than the 61 value in the survey the previous quarter.

Still, Wunderman believes an employment turnaround is in the offing because Bay Area employers have reeled in profits and sales at an improved pace.

"We're seeing on the whole a profitable Bay Area corporate sector," Wunderman said. "Companies have achieved a lot of profitability by cutting costs. Now it may be time to do a little more investing in their business and taking more risks by hiring."

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