December 4, 2022
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Mega-tech layoffs could reshuffle Central Coast talent pool

The expected layoff of more than 10,000 Amazon workers will likely result in more than a few job cuts on the Central Coast.

And because of the multiplier effect of such a large layoff, there will be some economic impacts. And it’s hard to say how equally large job cuts at Meta, aka Facebook and other tech giants will wash across the region. For Alphabet, Google’s parent, and companies like Meta or Apple, research and development projects take place in small offices or at university labs where head counts are not always so obvious.

The counterpoint to layoffs at companies like MindBody and Amazon’s Alexa unit are potential gains in talent for niche technology companies like Sonos, the speaker maker that has aggressively pursued an independent path to innovation. 

Deckers Brands, which has used technology to innovate in footwear design, supply chain management and inventory control is another company that could benefit from the availability of new talent.  Microsoft’s very large LinkedIn operation on the Central Coast, could also be a beneficiary.

Aerospace and defense is another area where available talent could find a new home. Raytheon’s large operations on the Central Coast are constantly looking for talent and the Russia-Ukraine war has placed new demands on both offensive and defensive systems that are the region’s specialty. 

Meanwhile, drones produced by AeroVironment in Simi Valley, and an array of sensors produced by Teledyne and its combined FLIR operations in Thousand Oaks and Goleta, are going to be in high demand. The emergence of unmanned marine vehicles is putting some of Teledyne’s newer technology in the spotlight.

In  the Thousand Oaks area, but also in Goleta and San Luis  Obispo, life sciences continues to be a growth area. Medical information firms are a lot like software companies and the new generation of device makers borrow a lot from traditional technology. 

So far, the region’s technology sector seems capable of absorbing whatever shocks are coming from the big tech cutbacks. 

Unlike the 1990s when the defense sector cutbacks sent shock waves through the entire Southern California economy, or the early 2000s when the dot.com bust dealt the regional economy a sharp blow, there is quite a bit more diversity to the tech sector – and perhaps the next generation of tech firms now being hatched in a garage or lab will be the beneficiary.

Napping through crypto

Every time I get the urge to invest in crypto, my first thought is to lie down and take a nap until the urge goes away. 

That seems to be one prevailing view across the Central Coast where, despite tremendous popularity of alternative investments, the region has not gained a lot of traction as a hub for bitcoin or stablecoin operations.

That turns out to be lucky as the swift demise and sudden bankruptcy of the FTX  exchange has sent the industry reeling.  My best guess is that there will be more and more FTX victims in the region as time goes on. 

There’s just too much wealth and too much ego looking for hot returns. We saw this with the dot.coms, with the subprime meltdown, the Reed Slatkin Ponzi scheme and certainly with the Madoff scandal, which claimed an unusually large number of victims on the Central Coast.  How many FTX promoters were hanging out in wealthy enclaves across the Central Coast? How much was lost?

We will soon find out.