What Limerick is about to experience is already old hat in Austin, Texas. One of America's biggest tech industry hubs, it has just seen its unemployment rate rise for the fourth successive month.
An increase in unemployment from 2.2 per cent in February to 2.7 per cent in April has meant 10,000 workers, most from high-tech industries, have lost their jobs in the greater Austin area since the start of the year. This figure does not include the 4,000 jobs expected to be cut from the local Dell plant in the next six months. The last time the city's unemployment rate was this high was in September 1998.
"People at Dell were experiencing a 50 per cent growth rate. Now it's cut in half. For them, that's a recession," Mr Stuart Greenfield, an economics professor at St Edward's University, told the Austin American Statesman newspaper. "It was unrealistic for this to continue on indefinitely."
Applied Materials, Intel, Concero, Solectron and dozens of other firms have all either laid off workers or halted planned investments in a city which saw $2.3 billion (€2.67 billion) in start-up venture capital poured into it in 1999 and 2000.
"Everyone is really worried about keeping their jobs right now. I don't know anyone in the tech industry who is very comfortable in their job currently. Everyone has their ears open for new opportunities because they have no security," Ms Amy Hughes, a sound engineer for a computer games development company in Austin, told The Irish Times.
Applied Materials, which made 500 contract-workers redundant earlier this year, announced pay cuts, rather than further job cuts, last week. Most workers will find their next pay packet 3-5 per cent lighter, with managers taking a 10 per cent cut and executives dropping 5 per cent on top of the 10 per cent they gave up in February.
The Austin branch of the world's largest chip equipment manufacturer is currently operating at less than 50 per cent of its capacity. Its sales of $1.91 billion were down 30 per cent and its profit of $269 million was down 52 per cent in first-quarter results.
The central Texas building industry is also feeling the effects of the downturn and some of the cranes that make the city sky look a lot like Dublin's are now silent.
In February, Intel slowed down construction of a $124 million, 10-storey chip design centre in the heart of the city. It stopped work completely and indefinitely on the project in March.
This might have looked alright if it had just started work on it before the extent of the downturn became evident, but the shell of the first six storeys has already been erected. What is now left on the corner of San Antonio and Fourth Street is an ugly aberration in an otherwise lovely city. The proposed 437,000 sq ft building is now surrounded by an eight-foot razor-wire fence.
Local business people are not amused - "It makes us look like we're in Beirut," said developer Mr Perry Lorenz. Questions are being asked in Austin, as in Ireland, as to whether the economy is too reliant on the tech industry. According to Ms Hughes: "I don't know what else Austin does well besides music and even then we don't have record companies here, just talent and studios. Austin, and Texas in general, has lots of other resources, but if the tech people left, the population would plummet."
It seems inevitable that the population will fall with the tightening jobs market. "Many people I have worked with prefer to stay here in Austin but sometimes they find better opportunities somewhere else," said Ms Hughes. "The jobs selection in Austin is limiting now that several companies have laid off so many people. Hundreds of `specialists' in your field are also looking for a job. It's `slim pickins'."
