Unemployment Down: Tech Layoffs Up

In opposition to the decrease in unemployment so far in 2015, there have been significant layoffs in the networking-computing industry since the beginning of the year. 

• Good technology: Privately held mobile technology company prepping to go public in the near future, employs 1,100 people, and cut about 100 late last year. 
• Sony: reported in January they would be cutting 1,000 jobs. In March, the WSJ claimed that it was cutting 2,000 of it’s 7,000 mobile unit workers.
• Microsoft: scaling back on mobile phone unit. They also cut 18,000 job cuts last year. 
• Blackberry: is expanding it’s device software, and unspecified how many jobs they need to cut in an effort to return to profitability. 

If all these jobs are being taken away, then what jobs are replacing them? Does the fact that a decreasing unemployment rate could answer the question as to who is fulfilling the replacement jobs? 

Check out the “Biggest tech industry layoffs of 2015, so far” here  

Tech-Exponentially

Targets have increased fivefold in the last five years compared to the five years prior.

Due to the nature of the tech industry, it proves to be one of the fastest maturing industry in history. As the consolidation of the industry settles in, activist investors are increasingly more drawn to tech giants as they get better and better results. 

S&P Capital IQ calculates that between 2005 and 2010, only 11 public tech companies with market caps higher than $1 billion dealt with activist investors. Now, in 2015 there are now 50 activists.  

As the age of buyouts slows its pace, it’s time that the risk-taking-youthers consider that investing in the climb of the technology era could just eventually bloom into pure bliss. As Apple issued a $80 billion share buyback program, they reveal the identity of their impressive net cash position. A company able to contribute such a high price back into their own brand shows the assertiveness of their position in the growth of the present day roots of technology. 

All good things take time. 

Read “Why activist investors are targeting the tech industry” here 

Market Play

As you have just read, the big backers of companies have a huge affect on the nurturing of other companies still in their seeds. At the end of the 1980’s, The US backed out of the industry wide joint venture based out of Japan called, US Memories Inc. Instead they were replaced by the entrepreneurial start-up, Micron Technology, based out of Boise, Idaho. 

Now, it looks like the news of Tsinghua Unicom (an offshoot of Beijing’s Tsinghua University) weighing up an offer for Micron is stirring the waters of national angst. In fact, Republican senator John McCain worried publicly about the “potential national security implications” if the US lost a significant position in the memory chip market. 

So shall we agree that it’s time to allow globalization to take its course by just allowing what seems natural to occur? who’s to say that our next move couldn’t be to expand operations for cyber defense? Because, how could a position be lost if it is just reallocated, and to our own market of all places. 

Read “China tech expansion hits a phase that will worry the US” here 

*"Negative animal spirits" is a quote that an economics professor of mine used to use in class.