Deepening Cycle of Job Loss Seen Lasting Into ’09

People were saying that at the beginning of the last crash, too.

Nevertheless, after a few months of sharply lower spending the investors began to get twitchy, and venture funding began to dry up. Startups imploded quickly, and the business that they were doing with the big boys went away almost overnight. Ultimately, the tech drought lasted well past the end of the official recession -- late to start, late to finish.

Some will say that it's different this time around; fewer tech companies depend on massive VC funding, and this effectively insulates them from the credit crisis. That's somewhat true, but if consumer spending continues to tank, it's going to hit discretionary purchases hard -- and how many software purchases are essential expenses in your household?

I don't know what's going to happen tomorrow, but I do know that most of our recent economic growth has been driven by a massive credit bubble, and that consumer credit is effectively gone right now. If people can barely afford to feed themselves and drive their cars to work, it's only a matter of time before they stop spending on technology.

That's why aggregate numbers like this aren't that useful. When a big industry like tech in '00 or housing/finance now have a bust, it throws averages off even if other sectors aren't very affected. Tech in Chicago is strong now and I've turned down great job offers.