Tech hiring poised for recovery -- and open source leads the way

More hiring and better benefits are actually appearing in Silicon Valley as tech firms come out of the recession

After a grim 18 months of layoffs and cost-cutting, there are finally signs that the tech industry is beginning to recover. Companies are slowly starting to hire and restore employee benefits. Venture money is flowing, and severe price slashing -- always the hallmark of a recession -- has slowed.

Huge numbers of techies are still unemployed or underemployed, of course. But economists expect that Friday's jobs report will be the strongest in months, and that gives me confidence that the green shoots I've seen sprouting in Silicon Valley aren't a mirage, as does the report that IT employment grew by 0.37 percent, or 14,000 jobs, in February, one of the strongest month-to-month gains since 2008.

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"The capital markets are opening up a bit, and that allows us to step on the gas," says MuleSoft Vice President Mahau Ma, whose company just received a $12 million investment from SAP Ventures and several other venture capital firms. A year or so ago, a small company that got additional venture funding probably needed it to stay afloat, but MuleSoft sought the cash to expand its sales and engineering teams, says Ma.

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Along with MuleSoft, I've come across a few more open source companies that have "help wanted" signs on the door. And that's not surprising. Even at the height of the layoff epidemic that swept Silicon Valley last year, open source companies were hurt less and seem to be recovering faster than conventional software outfits.

More benefits, fewer discounts
A sure sign that a company wants to hold on to employees and attract new ones is a richer benefits package. "Contacts are telling me that companies have started to match 401(k) plans, giving occasional salary raises, and (on a selective basis) started to reimburse their employees for education and training expenses," says analyst Trip Chowdhry, of Global Equities Research.

Chowdhry adds that he's seeing "more and more Silicon Valley companies highlighting the fact that they are hiring, during the customer presentations." Indeed, MuleSoft has started posting a "we're hiring" line on every press release the company issues.

Much larger businesses, including Apple, Cisco Systems, and EMC VMware, are hiring engineers for various internal R&D groups, while Oracle is struggling to find chip designers to work on Sun hardware now that the Sun acquisition has been fully digested, says Chowdhry. And there are reports that  LinkedIn, Twitter, Facebook, and Accenture have plans to hire very aggressively in the coming months.

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