At 02:38 PM 07/08/2002 -0700, Steve Diamond wrote: >The market will likely not recover fast enough to put most outstanding >options "in the money" tho companies will attempt to reprice options >downward and issue new options at lower strike prices. As Joanna says in >a bear market all bets are off - the interesting question is whether >employees will now step up wage demands (for cash) with declining values >in their stock based compensations plans (both options and pension plans). > It's hard to say. The epicenter of the crisis is now in hi tech and this is new. Although layoffs were always pervasive in the industry (while working for Apple for a decade, I experienced one to two layoffs a year), there were more jobs than applicants, and being laid off used to mean a fat severance package + substantial pay hike in the new job. All that has changed.
The economic picture for hi tech workers has actually been worsening gradually for a while: lower health care benefits, disappearance of profit sharing, the introduction of more competition through immigrant labor, ...and now, the disappearance of jobs and the unlikely prospect of new jobs. Of course, there were never any pensions, but for those who opted for 401K in stocks, that has declined too. Those who didn't wait for the Dow to hit 36,000 made some money off their stock options; those who waited lost everything. While hi tech wages remain high (relative to other wages), they are not high relative to the cost of living and to the absence of an adequate public education system in California. Housing continues to climb (the last bubble?) and generally, two high tech incomes are required to maintain a family that wishes to own a house and to educate their children. I have already mentioned the loss of all compensation other than wages. We are only now beginning to see layoffs in the industry (beyond the dot com stuff). What the general population of hi tech workers will do in the face of diminishing compensation and impending/actual layoffs is anybody's guess. These are folks that tend toward libertarianism and that have journeyed through life so far as privileged "individuals." On the other hand, they are also very intelligent and able people...a number of which are quite accomplished hackers. Unions? I doubt it. It should be interesting. At any rate, to answer your question, no one is agitating for higher wages. Joanna
