5/17/1999

By The Associated Press
SAN JOSE, Calif. (AP) -- High tech companies in Silicon Valley can't find
enough qualified workers to fill job openings and it's hampering the
industry's growth, a study released Tuesday found.


That employee shortage is translating into a $3 billion loss for local high
tech companies, according to a study by Joint Venture: Silicon Valley
Network, a group of public organizations and private businesses working to
improve the economic vitality and quality of life in Silicon Valley, where
most of the top high tech businesses in the U.S. are headquartered.


``Our study confirms that the area's high tech industry is not growing as
fast as it could be because there simply are not enough skilled people to
fill the jobs,'' said Ruben Barrales, president of the group. ``If Silicon
Valley wants to remain the capital of high tech, we need to become the top
producer of qualified high tech workers.''


The report found that 160,000 high tech positions -- roughly one-third of
the high tech industry demand in Silicon Valley -- are filled by recruits
from outside the region, by long-distance commuters -- or they go unfilled.


Ben Smith, who conducted the study with the management consulting firm A.T.
Kearney , said the ``gap'' between demand and supply in the local high tech
work force means employers have to pay higher salaries, have to spend more
on recruiting, and lose money during long gaps without employees. Smith said
those costs amount to between $6,000 and $8,000 per employee, or an annual
total of $3 billion to $4 billion.


The study projects that the area workforce shortage will increase to 200,000
positions by the year 2010, driven in part by a lack of interest among area
high school students in high tech careers.


The report comes just one week after Immigration and Naturalization
Service's announcement that the U.S. is about to run out of available visas
for foreign workers with high-tech skills.


Joint Venture managers said their findings do not necessarily point to a
need for more visas. Instead, said Barrales, Joint Venture will be focusing
on improving training and education programs at local schools.