‘Silicon Gulch’ in Dallas to Suffers From Slump

With the loss of almost 8,000 high-technology jobs in the Dallas area last year, the North Texas region that has been dubbed the “Silicon Prairie” is suffering--on a much smaller scale--the kind of drought that the oil slump has brought to Houston.

However, the growth in defense-related electronics work has helped offset some of the slump in the commercial sector, economists say.

The heaviest recent casualties came from Mostek, the semiconductor company being sold by its parent, United Technologies, to CSF Thomson of France.

Mostek accounted for more than 4,000 jobs of the roughly 8,000 jobs believed lost in the Dallas area’s high-tech segment during the year.

In addition, Xerox cut 1,200 jobs from its units here. Dallas-based electronics giant Texas Instruments slashed its payroll worldwide by 7,000 workers and, while it will not say how many Dallas area jobs that includes, estimates put the number at more than 500.

Apple Computer shut down a personal-computer manufacturing plant, cutting about 380 jobs; American Telephone & Telegraph is reducing its ranks in Dallas by more than 700 people, some through a voluntary plan that includes incentives; Northern Telecom cut 380 jobs when it moved a unit to North Carolina; Harris dropped 200 jobs from its computer plant here; DSC Communications, which makes telephone switching systems, dropped 250, and Intecom, a telecommunications company, laid off 200.

“I think Dallas is no more or less resilient than any other place in the country,” said Bill Moore, head of a high-tech company in suburban Irving and chairman of the American Electronics Assn.

“What we’ve seen is more dramatic decisions (such as the Mostek and Texas Instruments announcements) so that gives it more notoriety . . . The whole industry has really been in the ditch in the last 12 months,” he said, pointing specifically to the slump in sales of personal computers and semiconductors.

California Slump

That slump has hit even harder at California’s “Silicon Valley,” the region that gave birth to much of the nation’s high-tech development.

The layoffs by Mostek and Texas Instruments are blamed largely on the slump in the semiconductor market, which goes through cycles.

Texas Instruments executives note that they employ 80,000 people, the same as in 1983 before the work force jumped to 86,500 during a boom.

Mostek suffered sharp employment cuts for months and finally announced in October that most of the 2,500 remaining employees would be out of work as the parent company considered shutting down Mostek.

Thomson, the French defense electronics firm that will be Mostek’s new owner, plans to keep 1,000 employees.

Dallas unemployment figures for October, which would include the 1,500 Mostek layoffs and some at Texas Instruments, are not yet available. But figures for September show the area’s unemployment jumping to 5.1% from 3.7% a year earlier.

“We are obviously very definitely following the state trend of moving into a slow growth period in Dallas,” said Nic Santangello, chief economic analyst for the southwest region in the U.S. Bureau of Labor Statistics.

The statewide jobless rate of 8.1% is now a full percentage point ahead of the national rate, with the oil regions of west Texas and the Houston area among the hardest hit. Until oil prices began slumping in 1982, Texas’ jobless rate had been well below the national figure.

Since high-tech jobs make up an estimated 6% to 9% of the Dallas area labor force, the 8,000 layoffs have not affected the area as severely as the oil slump hit Houston, economists say.

Moore of the electronics association said he believes Dallas is somewhat protected because of its high-tech companies that cater to the defense and aerospace segments--such as Rockwell International and E-Systems.

Ed McClelland, vice president and economist for RepublicBank Dallas, says growth in the defense electronics sector helps offset the layoffs.

While Mostek produced a “significant layoff,” McClelland said, “I would be surprised if it had a significant impact on employment.”

Easier to Find Jobs

The diversity of the area also makes the job-hunting task an easier one, he said. Mid-level management workers who are laid off have a large service industry market to explore, and engineers and skilled technicians usually in demand, he said.