Often compared to the Wild West due to its reputation for risk and its frontier sensibilities, the tech industry has seen its share of booms and busts over its storied (if relatively brief) existence. In 2013, a six-year boom period came to a surprising end in the first quarter of the year. And as profits fell and layoffs ballooned, predictions for record growth were turned on their heads.
These dips in the tech sector are hardly uncommon. In fact, tech jobs also dropped in the fourth quarter of 2012, and while the decline was a mere hiccough compared to the much larger decline seen in the first quarter of 2013, it was still significant as a reminder of the volatility that characterizes so much of the modern tech industry. As 2013 progressed, tech giants such as Cisco, IBM, Oracle, and RIM reported hefty revenue losses and declining users. The large-scale layoffs that followed were an expected, if unwelcome, result.
And it’s not just corporate giants that were feeling the pain. Well-funded and buzz-heavy startup Lockerz was forced to trim nearly a third of its staff from its main offices in Seattle, and shut down its San Diego office completely. Other newcomers, such as TaskRabbit and Lytro, were also forced to tighten their figurative belts thanks to shaky demand and industry flux, although they may have been affected by the larger trends affecting small businesses of all kinds in a recovering economy.
Even in a downturn, however, the news for the tech world isn’t all bad. Third-quarter reports on 2013 tech startups showed promising first-month returns that helped mitigate the doom and gloom of falling venture capital and burgeoning job losses earlier that year. And long-term, the picture painted by the U.S. Bureau of Labor Statistics (BLS) is rosier still; by 2020, says the agency, employment in all computer-related occupations is expected to increase by 22% compared to 2010 numbers.
Whether such a prediction will come true in an industry known as much for its rapid contractions as its startling growth remains to be seen, but in the meantime, it’s likely life in the tech industry will remain a wild ride.
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