Technology and Internet jobs are rebounding with a vengeance in Southern California following a four-year downturn.

The Bureau of Labor Statistics released preliminary data last week showing that Internet services employment in Los Angeles rose 5 percent in the first six months of the year and could rise as much as 9 percent by year-end. Technology employment is seeing a similar increase in the engineering and computer systems design sectors, both up 5 percent.

The dot.com economy that was left for dead in 2001 and caused a severe economic downturn in Silicon Valley appears to be migrating south. Los Angeles is becoming known as a digital media hub and may soon overtake Northern California in the number of tech-related jobs.

Southern California, which includes Orange County and San Diego, employs 418,000 technology workers just trailing the 439,000 technology jobs in Northern California, according to a recent report by the AeA, formerly known as the American Electronics Association, a technology industry trade group.

“Everything we’re seeing shows growth and an upward trend in hiring for the first time since the technology bubble of 2001,” said Matthew Kazmierczak, vice president for research and analysis at AeA.

Ten percent of technology jobs in Los Angeles and Silicon Valley disappeared from 2002 to 2003 after the dot.com bubble burst, the AeA estimates. In 2004, technology employment in California fell 1 percent and has been flat for the past year.

Daniel Gossels, a principal in the media and entertainment practice at Montgomery & Co., said a major sea change is underway because advertising dollars are shifting from TV networks, newspapers and magazines to the Internet, which is changing traditional patterns of media consumption. That, in turn, has prodded many large companies to snap up entrepreneurial firms rather than build their own Web properties from scratch.

“It’s a fundamentally different environment,” said Gossels, who worked as an advisor last year on the sale of teen online hangout MySpace.com to News Corp.’s Fox Interactive Media. “We’re still really early in the cycle.”

Broad range


Rafat Ali, publisher and editor of PaidContent.org, a Santa Monica-based Web site that covers digital media, said there’s a much broader range in the terms of the types of Internet jobs being created now compared with five years ago.

“Money is finally coming back into the industry after the first wave of the dot.com boom,” he said. “We’re seeing all of these business models morphing, and that means companies need people with expertise and are hiring from a wide range of industries.”

The current Internet economy is creating jobs with a creative list of new titles: podcast producer, search engine optimization analyst, digital media manager and email content producer, to name just a few. The jobs are being created by a plethora of companies, from search engine Yahoo! Inc. to phone giant AT & T; Corp., which are creating their own original content to attract advertisers and viewers to their Web sites.

Tracking Internet employment is particularly difficult because government data often lags the market by 18 months.

In an effort to determine if Internet and technology employment is really on the rise, Kazmierczak, the researcher with AeA, began trolling the Web sites of Microsoft Corp., Intel Corp. and others, tracking the number of job postings online. He said hundreds of technology and Internet companies are in hiring mode and not all of the jobs are being captured by government statistics. Many tech or Internet jobs a Web manager at an auto dealer, for example don’t show up in the figures, but are instead listed as part of the employer’s sector.

On the tech side, several sectors appear to be in high demand including consumer electronics testing and design, engineering services, defense electronics and electro-medical equipment manufacturing. Only telecommunications, once a hot industry in Los Angeles, continues to lag.

Double bubble?


Michael Leigh, founder of Technology MarketForce Inc., in Malibu, and a former chief operating officer of network switching company Tekelec, said he sees some signs of potential trouble ahead, however. Too many companies are once again chasing too few deals, he said, and paying exorbitant prices for firms that many not be tested in the marketplace.

“It’s still a bit patchy in certain segments because there are too many companies being funded in IDTV (integrated digital television) content and mobile entertainment content,” he said. “So the question being raised is whether we’re headed into another bubble economy.”

Dan Rohn, a former copy editor with the Washington Post who created the web site JournalismJobs.com, said in his segment of the industry only one out of every seven job postings online are for Internet-related jobs and that online content is still predominantly controlled by newspaper publishing. The general perception is that online media is slowly gaining on, and will someday overtake traditional media, but Rohn said it hasn’t happened yet.

“The numbers are not as huge as people think,” he said. “There are a lot of forces coming together and what’s happening is there’s a readjustment of these industries simply because more people are getting their news online and not paying for subscriptions.”