Recession may be over but many Silicon Valley residents feel left out of recovery
Originally published Nov. 27, 2011 by the San Jose Mercury News.
By Patrick May
Reports of the death of the Great Recession have been greatly exaggerated.
Just ask Karen Jones.
“I don’t think there’s a recovery at all,” said the 69-year-old retired schoolteacher from San Jose. “The rich are getting richer, the schools are going downhill, there are more and more furloughs. I’m not as worried about my situation as I am about my kids. I guess I’m really just worried about the future of our country.”
She’s got plenty of company. While economists say the recession is technically over, many in Silicon Valley certainly don’t see it that way. Despite a recent hiring boom, 44 percent of those polled in the fall 2011 Silicon Valley Pulse survey said they felt left out of any recovery that might be going on.
Even more troubling, a growing number of valley residents have lost all hope of finding relief any time soon. Asked how much longer they believe the recession will last, 21 percent of those polled said they think it will drag on for more than five years; that’s more than twice as many respondents who felt that way in April 2009. Forty-two percent — up from 38 percent a year earlier — said they were bracing for the economic downturn to continue for at least three more years.
“This is not really about economists’ projections or what the stock market may be doing, but rather how people are feeling in their day-to-day lives,” said Melinda Jackson, research director of the Survey and Policy Research Institute at San Jose State who coordinated the poll, a telephone survey conducted each spring and fall since 2009. “And people are feeling a lot of frustration. Even if you’re lucky to have a job and a house, there’s no strong sense that things will get better in the near term. People just don’t have much confidence that we’ve turned the corner yet.”Mixed signals
The Survey and Policy Research Institute polled 458 Silicon Valley adults from Oct. 18 to Nov. 12; the margin of error was plus or minus 4.6 percentage points.
The time encompassed by the polling was a period of mixed signals from the local economic front. Job growth, especially in the tech sector, has been strong, while prices of single-family homes in Santa Clara County in October were down 8 percent from a year earlier.
Among the questions was one submitted by the Mercury News: “Experts say that Silicon Valley is adding jobs and the economy is improving. Do you feel that improvement in your own life, or do you feel left out of the valley’s recovery?”
Nearly half responded negatively, but not everyone was full of dread — 35 percent of those polled said they’d seen improvement in their lives. Yet even among those who were encouraged by the recent hiring boom in Silicon Valley’s professional, scientific and technology fields, few were ready to break out the Champagne.
Compared with many Americans, Melissa Flower is financially comfortable at 60. Retired from the city of San Francisco, where she was a community affairs specialist, Flower owns a house, has a government pension and is not saddled with debt like many who lived large during the economic good times. Still, as she takes on substitute-teacher gigs and nurtures her fledgling writing business to pad her savings, Flower sometimes feels as if she’s watching a jobs market rebounding without her. And she blames herself.
“I didn’t keep up on getting any high-tech training,” she said in an interview. “As a woman growing up in a generation that seemed focused more on liberal arts, I just didn’t think about it. Now I see this tech hiring boom and while I do have a package of skills and lots of energy, I’m just not technologically marketable.
“Silicon Valley companies are hiring,” she said. “But they’re hiring people who are younger than me and who know computers.”
Even though Camille Ahern has a 401(k) she hopes will tide her over through her retirement years and owns her house outright in the Santa Cruz Mountains, the retired Hewlett-Packard (HPQ) employee is still concerned enough about the nation’s financial malaise that she’s watching her spending and cutting back on vacations.
“I think that here in Silicon Valley the recovery does seem to be occurring, though hiring is not where we were five years ago,” she said. “But at least we’re going in the right direction. Unfortunately, that doesn’t help the poorest of the poor. I see the pain in our immigrant population and with people who don’t have the education needed to work here in high tech.”
Today’s Silicon Valley companies, Ahern said, “are no longer heavily involved in manufacturing, so the available jobs aren’t for blue-collar workers but for professionals and those who can do intellectual property stuff. That leaves a lot of people out, and I do worry about those in the general population who aren’t adequately trained for today’s jobs and for their children, who probably won’t be adequately trained, either.”
Ups and downs
The survey, whose full statewide results will be released Monday, also asked respondents about the health of the business community in Silicon Valley. Jackson said those polled expressed more negative assessments of the region compared with six months ago.
There were, though, respondents who felt the recovery is alive and well, even if they do have friends and family who are struggling. Jay Rasmussen, a Morgan Hill resident who owned his own company making furniture from redwood burls, said he now has enough retirement savings “to relax, enjoy my nine grandkids and not have to worry about money all the time.” Still, said Rasmussen, his son lost his house in Castroville, “and I know a lot of people who have lost their jobs.”
The survey was conducted shortly after the state released encouraging employment numbers for the region showing a tech-hiring surge in September. Economists said at the time that the region was running ahead of the state and nation, boasting a 3.1 percent year-over-year job growth, or the addition of 26,000 jobs. Even the badly routed construction industry showed a hopeful trend of job growth in September, adding 1,000 jobs to build on momentum displayed most of this year.
Liz Seminar, 40, of Hollister, said her husband, Dean, 37, was both a casualty and beneficiary of the recessionary roller coaster. After twice losing construction jobs in the downturn, forcing the family of four to confront the possibility of total financial ruin, Dean finally found work driving a truck delivering medical supplies.
“He got the job in August, but in the months before that we were freaking out,” said Liz. “I was afraid we’d lose our house and everything.”
They still may lose their house, which is underwater and carries a mortgage with a $5,000 monthly payment. Still, she said, “we’re just grateful and thankful that he’s found another job.”
Contact Patrick May at 408-920-5689. Follow him at Twitter.com/patmaymerc.