June 28, 2006 at 5:40 AM #6782Beach RatParticipant
There is a large Bio-Tech/Pharmaceutical industry in San Diego. The Union Tribune has a pretty good section that tracts major events in this community. The problem with Science related industries is that they tend to be volatile. This may add an interesting wild card to a Real Estate down turn especially if people become trapped with zero equity and are forced to relocate. It is hard to tell when one of the major companies will just layoff people off in droves because their latest blockbuster tanked. These two stories just caught my eye.June 28, 2006 at 6:20 AM #27495
Add the possible Nokia layoffs.June 28, 2006 at 8:53 AM #27500anParticipant
I think it’s more than a possibility now. Nokia is pulling out of CDMA completely and their division here in SD is 100% CDMA, so it probably mean they’re closing shop here.June 28, 2006 at 9:27 AM #27502carlislematthewParticipant
I searched on Google News for “San Diego Biotech” and came across this article:
It seems that there is still a flood of money coming in to San Diego for biotech. Of course, that may slow down or stop at some point in the future. However, I don’t think healthcare in general is a dying business. I believe this is why many towns (including my old town, Seattle) are desperate to set themselves up as a bio-tech area. San Diego has already done it, and *seems* to be doing well, in general.
The FDA is always going to “get in the way” and not approve some life-saving (but stroke inducing) pill, but I think it’s more important to look at the longer-term view.
Exactly what that is, I’m not qualified to say. Anyone reading this forum work in biotech? Care to comment on the employment situation right now and how it compares to 12 months ago?June 28, 2006 at 4:13 PM #27522nin_sisParticipant
I work at a large biotech company with a fairly stable future. However, Merck has left town, Pfizer has been laying off the last 3 quarters (about 200-300 per round), Neurocrine’s drug won’t be approved as Pfizer has just let them go and small biotechs don’t last for more than 3 years. It is a very volatile industry and sometimes hard to keep a good job. I’m at the mid management level with some graduate education, but the higher you get in education the tougher it is to find good stable positions. I know of several people who have been affected by recent layoffs and have been unemployed for several months. However, lab bench workers are able to find positions immediately. Not really sure about the effect on housing as of yet. The lower paid workers (non-PhD) are usually renters and in their mid to late 20’s while the higher educated/ salaried ones own homes, yet are older so they probably bought before the boom and may be unaffected by losing their job (or can take the time to find something comparable). That’s my view.June 28, 2006 at 5:41 PM #27525
I spoke with a Nokia engineer this week, and he told me the decision about CDMA will be made on August 2. Then, they will either drop CDMA and close down the SD division in increments until final shut-down on April 1, or go forward with the other (non-CDMA, I forgot the name) technology and lay off half the people (needing only half the staff to work on the other system). So they will lay off at least half the staff, perhaps all.June 28, 2006 at 10:08 PM #27535anParticipant
I think the other technology you’re refering to is WCDMA or aka UMTS. They had around 1500 employees before the initial layoff. I think they have around 1000-1200 employees now. So even if they only layoff 1/2, best case, that’s still 500-600 employees needing a job. There’s not enough demand to absorb that many people. I’m in the wireless industry, working for Motorola. Used to work at Nokia 2 years ago. The wireless industry in San Diego cannot absorb 500-600 people. Which mean either they’ll have to change industry, which is not easy, especially for high paying sr. software engineer, or be out of a job, or move to a different city such as Dalas.June 28, 2006 at 10:43 PM #27536rankandfileParticipant
You present an interesting dynamic, nin_sis. You have the older upper managers directing all of the worker ants who are doing their best to make a living and can’t afford to own a home on their average (if not low) wages. How long will they be content with long hours and long commutes, and not have any home or equity to show for it? A similar dynamic can be seen in other industries as well. I think one thing that ends up happening is that some (if not many) of these young, educated, hard-working folks try the SoCal thing for about 1-3 years or more and then just give up. Many end up moving to places like Arizona, Nevada, etc. or back to where they came from, so that they can start/raise a family and not go broke doing so.
I think that this further adds to the loss of the middle class in SoCal. There are mostly the haves and the have nots…and the have nots are in much greater numbers considering illegal immigration. No wonder why healthcare still thrives. People will always get sick or injured, no matter what demographic they are a part of. Who pays for their healthcare services, well, that’s another thread altogether.June 29, 2006 at 1:09 AM #27540BugsParticipant
Of course, if the market does return to trend those worker ants may well get their chance at owning a home.June 29, 2006 at 3:20 AM #27542rankandfileParticipant
What you mention is very nonchalant and simple, yet profound. There are many educated, hardworking people in SoCal who just can’t enjoy the American dream of owning a home. Sure, renting provides a roof, electricity, and running water, but it’s not the same. Many of us are content on renting for now because we know the housing market is out of whack and it’s a staring contest at this point.
What’s profound is that there seems to be a strange feeling that there’s something fundamentally wrong with the economy here in SoCal. I don’t have the economic mind or motivation to break it all down. It just feels that, in general, the inflationary price pressures and relatively stagnant wage growth are bound to crash together at some point unless things change. It’s like driving a car whose engine malfunction sensors are broken. We have been driving with our pedal to the metal for way too long and don’t know that something very bad is about to happen. –Enter worsening economic and housing stats — We have a feeling that something bad could happen, yet we keep on driving.June 29, 2006 at 5:26 AM #27543
Yes, the laid off people will surely leave San Diego.
I just spoke with another friend in biotech, and asked her how she sees the SD biotech industry. “Poorly”, she said. Most of the companies here are very small, and her jobs exists only at the big companies. She said the best biotech cities are San Francisco, Boston, and some places in North Carolina. SD comes in 3rd or 4th place.
All this makes me wonder if SD is really such an up and coming city in wireless or biotech. It appears we are scraping by and getting smaller in these areas.June 29, 2006 at 10:53 AM #27568nin_sisParticipant
Indeed a lot of biotech/pharma positions in San Diego are filled by out-of-staters. It is also true that a lot of 20 something, Bachelor degreed, fresh out of college kids are taking the lower paid positions to live the So. Cal lifestyle for awhile. In fact in my company we’ve had several move back to their midwest home states in the past year to pursue grad school or other pharma positions. Again, they don’t have any ties to this city in the form of a mortgage and were all single. In my opinion, biotech doesn’t have a promising future in San Diego if the cost of living continues to rise as it has been. It is very hard to recruit upper management PhD’s with families and so the pool of talent is slightly diminished. I think we are scraping by as well and if this housing crisis continues, more and more people are going to realize that owning a home in SD won’t ever be possible and they’ll pick up and move.June 29, 2006 at 2:42 PM #27575speakerParticipant
I don’t have the time now to offer up a more detailed response (I have to return to the bench for a timepoint) but what I can briefly say is that San Francisco is NOT a good place to live and work as a member of the rank and file for the Biotech/Pharm sector.
I relocated from there to here for that very reason. The industry as a whole is much stronger in SF compared to San Diego but that doesn’t mean it is any better working there.
“End of line.”June 29, 2006 at 8:29 PM #27585Beach RatParticipant
It was not my intension to say that Bio-Tech is failing. The industry is has a lot opportunities. Bio-Tech/Pharm is, however quite volatile meaning that there can be a high turnover of jobs. Personally I have averaged over one round of layoffs or merger per year I’ve been in the industry, maybe it is just bad luck. The upper level people should not represent a problem. They may be forced to relocate for a new position, but should be financially sound. What worries me are the people that have worked in the industry for about 2-4 years starting entry level that have purchased condos. If they were to leverage themselves out they could get into a home albeit a small one. Couple that with a volatile job market and you have a situation that could add fuel to a fire of a housing down turn. The thing I love about Bio-Tech/Parm is the excitement. You never know when what you are working on is going to explode, good or bad. Elan for example.June 29, 2006 at 9:01 PM #27592AnonymousGuest
I worked in biotech for years in the Bay Area before switching to clinical research. Many people I know have recently left CA to take jobs in RTP, Philadelphia, Boston and New Jersey. If you can stand living in the south, it’s like doubling your salary by moving to a place like Raleigh. One of our friends bought a house there with the money he made selling a house he had bought here 5 years ago. He still had lots and lots of money left over to sock away……
What I can’t figure out is how researchers working for UCSD manage to survive here. Staff research associates make between 22 and 36 K a year. These are people with college loans to pay off. Usually, they realize they’re not getting anywhere and just get another loan and go to graduate school, putting off the inevitable for another 5 years…………
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