At first glance, 18-month-old Jobster seems to have re-created the 1999 dot-com office cliché. The online recruiting startup occupies...
AT FIRST GLANCE, 18-month-old Jobster seems to have re-created the 1999 dot-com office cliché. The online recruiting startup occupies a loft in Pioneer Square with exposed brick, a wide-open floor plan, a ping-pong table and a dog running loose.
But the similarities between this young company and the dot-coms that fell before it end there.
The difference, as founder Jason Goldberg puts it, is: “Web 1.0: arrogance. Web 2.0: humility.”
Five years after the technology bubble burst and two years into its recovery, the hubris that shaped the 1990s tech startup is noticeably absent.
So are the five-figure signing bonuses, piles of stock options, lavish launch parties, $800 Herman Miller office chairs and the flawed assumption that a New Economy driven by technology was somehow immune from the old rules of business.
As the tech economy revs up again, a post-recession character emerges:
Drunken optimism is out; sober reality is in.
Job hopping is out; loyalty is in.
Living to work is out; working to live is in.
Greed is out; gratitude is in.
In short, the old-economy workplace is new again.
It’s reflected in everything from more cautious hiring to smaller pay raises and fewer stock grants. It shows up in slower business growth, saner work schedules, and an almost violent rejection of the jackpot mentality that dominated tech companies when the economy was in full boil.
This is apparent even at Jobster’s hip offices. While the company’s 50 employees stand to benefit nicely from their stock options if the venture-backed company takes off, money had better not be their top priority.
Even as the competition for good workers heats up, Goldberg, a 33-year-old, adrenaline-pumped superachiever and former aide to President Clinton, rejects bribing anyone with a signing bonus, those up-front payments used by some desperate employers to lure tech workers back in the 1990s.
“I’m not in the business of buying people,” he says, taking a bite of a taco salad as Scooter, his cocker spaniel, sneaks away with his napkin. “If dollars are the reason they’re coming to Jobster, they’re coming to the wrong place.”
Other employers agree. Even though many companies fostered greed during the boom by promising big salaries and important job titles, they also resented jobseekers’ growing sense of entitlement.
Tamara Rashid, a former recruiter for the computer retailer Zones, recalled in a 2002 Seattle Times interview: “You’d see them pull up in their Ferrari and their $5,000 suits, and an air about them that says, ‘I’m looking for something that can maintain that car payment.’ “
Nor have managers forgotten the bad hires of the past, people who didn’t fit the job or the company’s culture. They got hired anyway because the era’s manic sense of urgency — get big fast! — often meant filling five, 10 or 15 positions in a single week.
Today employers are determined not to repeat past mistakes.
Concur Technologies, a Redmond software company, needs to add up to 100 people this year. But it would rather leave a position open than fill it with someone not aligned with the company’s values, says HR vice president Susan Webber.
Chief among its values is to create leaders who combine “professional will and personal humility.”
Self-promoters don’t fit that model, nor do candidates who hopped from job to job. “Money jumps,” as recruiters call them, are evidence that the person would bolt the company the minute a more lucrative offer came up.
“We want to hire people for the long run,” Webber says. “Five years ago that wasn’t necessarily the case in the market.”
Rapid fall, slow climb back
Sports-car-driving egotists were hardly the majority of employees in the 1990s, and the rest of the talent pool may still be paying for their arrogance. But for many tech workers, the job opportunities were so abundant, and the pay so good, it seemed foolish not to take advantage of the offers.
Bill Boyde, a veteran software programmer, doubled his income in 1999 when he left a job at Boeing to become an independent contractor.
When the tech bubble burst, contract work dried up and Boyde was among thousands of programmers without a job. He got one contract gig, but it was nearly two years before he landed a full-time job, this time at Nintendo.
But the job hardly involved technology. He earned $9 an hour moving pallets, stocking shelves and preparing orders for shipping at the company’s distribution warehouse in North Bend.
“The computer system was maintained by their computer people,” he says. His job “was like a grocery clerk without the groceries.”
Boyde, 40, has paid for own health insurance since he left Boeing. He buys the bare minimum to cover emergency care, and he avoided visits to the doctor for four years. He paid his dentist and optometrist cash out of pocket.
But his career prospects have gradually improved. In May, he landed a contract position through a temp agency. He’s testing new programming tools for Microsoft.
“Assuming I do well at this contract,” he says, “I think things will work out.”
The recession took its toll on salaries. For the last four years, annual wage growth among tech workers stayed well below 2 percent until it inched up to 2.64 percent this past spring, according to Applied HR Strategies, a Kirkland firm that tracks compensation trends for about 70 of the state’s largest technology companies.
Five years ago, those same salaries were increasing by more than 10 percent a year.
The sluggish pay growth indicates that starting salaries have dropped for some jobs, says Doug Sayed, owner of HR Strategies.
“The surveys don’t measure people who get laid off and have to take a pay cut to get employed.”
Only the pay for the industry’s elite — those with lots of experience and in-demand skills — has continued to rise significantly. A principal software engineer, for instance, earns about $118,000 a year compared with $94,000 three years go.
Merit raises are smaller or given less often than in past years, according to various surveys, the result of explosive health-insurance costs and a tender economy that still favors employers.
The stock-option gold rush is over, thanks to new accounting rules requiring companies to list employee options as expenses.
Microsoft, which minted millionaires by the thousands in the 1990s, stopped granting employee stock options altogether, replacing them with outright stock grants given more sparingly.
“The vast majority of tech firms still provide options, but the numbers they’re giving have dropped roughly 30 percent,” Sayed says. “I know of at least four public technology companies that have stopped giving options to new hires. That would have been unheard of a few years ago.”
If the economy is recovering, so are the people who fueled it.
On average, tech workers are putting in fewer hours than they were five years ago — about six hours less per week for software workers, according to the U.S. Bureau of Labor Statistics.
Labor economists don’t know if this is because technology has improved productivity or if attitudes have simply changed.
To be sure, some techies still work insane hours, but there is a growing backlash against the overwork ethic of the late 1990s. Back then 10-hour workdays were the minimum. In one storied company-wide e-mail, a dot-com executive scolded his staff for leaving the office before 6 p.m.
People were willing to log 50- to 80-hour weeks, however, in exchange for future stock riches and the chance to build a product, or sometimes an entire company, from the ground up.
But the bust left legions of workers burned out, bitter and fighting back.
After three tech workers were laid off from Redmond’s Advanced Digital Information in 2003, they decided they should have been paid for the extra hours they’d put in during the busy years. They sued their former employer for violating overtime laws, and won a settlement for an undisclosed sum.
A larger wage case that could permanently alter the industry’s workaholism involves Electronic Arts in Silicon Valley. Game developers want to end or at least get paid for “crunches,” a final push before a game is released, which sometimes requires them to work around the clock.
California software engineer Evan Robinson explained how worker output declines after 40 hours a week, and that working 20 hours straight “is the equivalent of being legally drunk.” Crunch mode, he concluded, is “not just abusive, it’s stupid.”
Robinson posted his analysis last year in his blog, Engines of Mischief. It drew dozens of responses, including one from a developer who said he now insists on 40-hour work weeks in his employment contracts.
Other tech workers took more extreme measures: They left the industry altogether. By 2002, a quarter of the state’s 126,207 tech workers had scattered to other industries, according to a state report. Some were pushed out by the sector’s decline; but others went willingly.
Susan Boling, 29, once had dreams of rising to a top job in a technology company. But working 60-hour weeks as a tester for Microsoft soured that ambition. She quit in 2002 and became an artist and yoga instructor.
“I don’t shake, I don’t faint, I don’t ever cry anymore,” she says. “Career is important, but life outside of that is much more important.”
Back in the late ’90s, Lisa Morris-Wolff used to keep a notepad on her nightstand so she could jot down reminders about work, evidence of a job so consuming it intruded on her sleep.
She spent 12 or more hours a day as a business-development executive for Aptimus, an online direct-marketing company in Seattle. When she wasn’t working, she was hanging out with co-workers and talking about work.
But like a lot of people in the industry, Morris-Wolff got older, got married, bought a home, had a daughter.
And even though she joined another Internet company, the profitable and stable 9-year-old onlineshoes.com, her job is no longer her only focus.
Now when she wakes up, her first thought is, “I wonder if Kate’s awake.”
Such shifting priorities are reflected in surveys, which increasingly show that employees want more time off and more time with their families.
Last fall, a poll on salary.com found that 39 percent of workers would choose time off over a $5,000 raise — up 20 percent from a similar poll three years earlier.
Of all the changes occurring in the tech workplace, this one may be the most profound. Workers learned through gritty experience that no amount of money can compensate for not having a personal life.
The catharsis for the Electronic Arts revolt, in fact, came from a Web posting by a disgruntled spouse.
“When you keep our husbands and wives and children in the office for 90 hours a week sending them home exhausted and numb and frustrated with their lives,” she wrote, “it’s not just them you’re hurting, but everyone around them.”
For companies worried about retaining their workers once the economy improves, “work-life balance” has replaced “work hard, get rich” as the new mantra.
At F5 Networks, a Seattle computer networking company, employees can take time off to climb Mount Everest, sail boats, race cars, run marathons or get involved in the community.
“Balancing work and personal life is one of the top goals,” says Bryan Skene, a senior product development manager. “Having a good life means working hard but also playing hard.”
Such corporate spin may sound hollow coming from anyone else. But Skene, a seven-year veteran, knows what he’s talking about.
In 1998, he once worked an 18-hour shift, then headed straight to the hospital to help his wife deliver their second son.
That was before the bottom fell out of the tech economy and before F5’s growth slowed to a manageable pace.
Today, when employees end up having to work nights or weekends to get a project done, Skene says, “it’s a sign that their manager has done a poor job of organization.”
Frugality regains its charm
If there’s a model for the post-bust technology company it might be digital.forest: patient, measured and lean. Some might even say cheap.
The 11-year-old company hosts Web sites and handles traffic for companies such as Car Toys. In a good year, its 23 employees might get a $100 bonus. They’ve never had an onsite gym, pool table or in-house massages, but they did get to play Asteroids, a video game the company bought used on eBay.
When the company napping couch wore out, CEO Kris Bourne decided to upgrade — to a better couch.
And the table in its reception area? A metal box from Sun Microsystems.
“Server furniture,” says Chuck Goolsbee, who heads the company’s technical operations. “And it even matches.”
There were days during the startup frenzy that digital.forest worried it might be too small, too slow, that it might just get elbowed out of business. Unlike the venture-backed firms, digital.forest financed its growth mostly through revenues, and later a handful of private investors.
Its penny-pinching has brought the ultimate reward, of course: Five years after the bust, the company is still in business, while many of its competitors — would-be titans of telecom, networking and data storage — are gone.
In January, digital.forest moved into a state-of-the-art technology campus in Tukwila designed for those rivals, some of whom crashed so suddenly they left behind coffee cups, office papers and blueprints for growth that never happened.
“We’re living in their carcass right now,” Goolsbee says, “little mammals amongst the dinosaur bones.”
Goolsbee walks through digital.forest’s cavernous server warehouse, pointing out the relics scavenged from extinct competitors: rows of skeletal server racks, switches, $250,000 routers bought for under $20,000 each.
The concave stone slab that was supposed to hold the sign for anchor tenant Zama Networks still stands in the lobby, just to the left of a dramatic cast-glass wall. Outside sits a generator the size of a truck, a mother lode of emergency power. Above, a brook burbles in a feng-shui garden tucked between two parking lots.
Zama went bankrupt in 2001. Another tenant, a California-based Internet service provider, backed out of its lease. So tiny digital.forest gets the benefit of that ISP’s data warehouse. It also gets use of the garden, the giant generator and the river of fiber-optic cable running through the pavement below.
“We had what they didn’t,” Goolsbee says of the companies that disappeared. “We had customers and we had revenue.”
Shirleen Holt: 206-464-8316 or firstname.lastname@example.org