With all the economic mess from the past two weeks, it looks like Sillicon Valley may be the next victim to feel the wrath of a crumbling market. With Lehman Bros. collapsing and an $85 billion government loan to A.I.G., computer giant Hewlett Packard has begun laying off employees, while eBay has been rumored to start whacking 10% of its 15,000 person workforce.
According to the NYTimes.com article “Silicon Valley Layoff Watch: Is eBay Next?”, Brad Stone writes that many internet companies have measured their employment rates on a projected 50% yearly increase due to rapid, historical grow. Now, with the economy’s eventual slowdown, eBay and similar internet companies are finding themselves facing a reality of being under-production and overstaffed.
EBay’s situation is unique due to the past year’s outrage by its buyers and sellers. Increased seller fees and other various policy changes have forced many sellers to venture to competitor auction websites to conduct business, leaving eBay a shell of its former self. With a tumbling market and possible eBay reconstruction on the horizon, the former online auction house giant may find itself in very unfamiliar waters.
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