[Hpn] Silicon Valley high-tech workers ending up in California shelters
Mon, 18 Jun 2001 14:33:23 -0700
Saturday, June 16, 2001, 12:00 a.m. Pacific
The big fall: Silicon Valley high-tech workers ending up in California
By Karen A. Davis
The Associated Press
SAN JOSE -- Mike Schlenz, who recently installed computer networks for a
living, had been sleeping in his Honda Civic for three months before he went
to a homeless shelter.
John Sacrosante, who earned more than $100,000 a year as a free-lance
database engineer, spent his 39th birthday last week with the "brothers" he
met at the church shelter where he has been living.
Both are casualties of the dot-com bust in Silicon Valley, where a
surprising number of former high-tech workers are rubbing elbows with
society's castaways - the mentally ill, drug addicts and other hard-luck
cases - in homeless shelters.
"We're all equal here," Sacrosante said. "When you're used to making six
figures and working in a dynamic and exciting environment and all of a
sudden it goes away, you do have a nice little world of depression going
Nearly 30 unemployed tech workers are among the 100 men at the Montgomery
Street Inn and other shelters in San Jose run by InnVision, said Robbie
Reinhart, director of the organization.
"They're not what we used to call hobos on the street. Most have college
degrees," she said.
Dot-com failures sent San Francisco's unemployment rate up to 4.2 percent in
May from a rock-bottom 2.6 percent a year ago - with 18,000 people added,
according to a state report.
In Santa Clara County, the heart of Silicon Valley, layoffs in
electronic-equipment manufacturing and business services rose for the fifth
straight month, contributing to a 3.2 percent unemployment rate last month.
Reinhart said most of the tech workers she sees have had their contracts
canceled or been laid off from start-ups and other smaller technology
companies. Other shelter residents still have jobs but don't make enough to
afford the high price of living in the valley, she said.
High rents, no pay
Top consultants and contractors once named their salaries in the valley.
Now, even those who qualify for unemployment benefits soon discover the $40
to $230 weekly check will not cover an apartment here, where rent averages
around $1,800 a month.
Suicide and crisis hot-line operators in San Francisco and Santa Clara
counties report that job-related calls nearly doubled from October to April.
Many callers complained of lost jobs or feared they would soon be out of
"There have always been layoffs and economic downturns, but what makes this
unusual is that people in the valley have become appendages of their jobs
and their workplace. They've worked up to 110 hours per week and slept on
the conference room floor," said Ilene Philipson, a clinical psychologist at
the Center for Working Families at the University of California at Berkeley.
"People have given up all sorts of things to give to their job, and when
there's a layoff there's no other support for them."
Schlenz, 35, a Bay Area native with a degree in environmental chemistry,
made as much as $60,000 a year as a free-lance contractor, installing Unix
networks, configuring routers and working in desktop support for small
companies. Then his jobs disappeared.
"I'd been to all the job fairs. I'd followed up on all the résumés," he
said. "Some of the larger companies approached me several times, but then
kept leading me on for months. Departments were downsized and outsourced.
Recruiters just stopped returning messages."
Schlenz still has some stock, but the value has dropped.
"I cashed in half my stocks to eat. I couldn't even afford gas anymore," he
said. He gave up his apartment after running out of cash and "car-camped"
behind a bookstore.
Someone told him he could get a meal at the Montgomery Street Inn, where he
now stays. He volunteers in the shelter's computer lab, teaching residents
how to use computers.
The inn has the same policy for all its residents - stay free for a month,
then pay $45 a week, whether they have a job or not.
Sacrosante was laid off shortly after moving from San Jose to Phoenix to
work on what was supposed to be a six-month project. He came back to San
Jose three weeks ago with the promise of being hired by one of two Santa
Clara-based technical-training companies. The offers fell through.
Twist to the story
There's an only-in-Silicon-Valley twist to his story: Sacrosante and three
other former high-tech workers who met at the shelter are launching a
start-up business that will resell wearable mobile- computing systems.
Sacrosante said he will use some of the money he secured for the venture to
rent a house.
Schlenz is still waiting for his lucky break.
He has applied for an entry-level position, something for which he is
overqualified, at Oracle. But he said he now has more of what it takes to
make it when a top company hires him:
"After this experience, I feel I have more determination than other people."
Copyright © 2001 The Seattle Times Company
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