Originally coined as a riff on Silicon Valley, the name Silicon Alley was given to the large concentration of Internet and new media companies in New York City in the late 1990s.
Yet the term, along with the citys reputation as a tech hot spot, scattered after the dot-com bust, and companies that managed to stay afloat were all but obliterated by the economic slow down following the 9/11 attacks.
For most of the period between 2000 and 2005, IT-related employment in New York City was in a slump. According to the New York State Labor Department, IT employment in New York City plummeted from around 50,000 in 2000 to 35,000 at the end of 2005.
Yet, the need for solid IT processes never left the city. Fuelled by changing business information processes and communication requirements, employment in computer services in New York City increased by 5.3 percent in the first half of 2005, according to a report released that year by the Fiscal Policy Institute, based in Albany, N.Y.
Much of the improvement was led by computer professionals working in finance. Nevertheless, new technologies, cost cutting at firms which led to outsourcing, and an increased integration of IT functions within the business sides of firms have all served to alter the occupational outlook for IT professionals in New York City since 2001.
New York States Labor Department projected that computer-related jobs in New York City were likely to increase by over 22 percent between 2002 and 2012, an increase of over 20,000 jobs, with 3,500 job openings annually.
Recent data from Dice.com, a job site for technology professionals, suggests that although New Yorks metropolitan IT job market has improved since 9/11, it still has a ways to go before returning to its earlier vibrancy. Postings for job openings on the site grew 22 percent between December 2006 and April 2007, but tumbled in June. It made some recovery in August, with 11,046 job openings, but had yet to return to its March peak of 12,377.
“New York Citys tech sector has not fully recovered from 9/11,” Franklin Madison, technology program director for ITAC (the Industrial and Technology Assistance Corporation), a nonprofit economic development organization, told eWEEK.
“But I think its recovering at the same pace that the city and industry are. The best technology is that which you do not see. The city is experiencing a level of growth and fiscal health, and as the city comes back to life, technology will be driving it.”
Madison argues that much of the reason the citys tech sector has yet to make a full recovery is that, like most of the nations tech sector, New Yorks is taking more careful steps this time.
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“People want to be more careful. Part of the 9/11, dot-com bust was because a lot of crap was coming out. 9/11 was just the final nail in the coffin, the day the music stopped and people began to reassess,” said Madison.
“While New York isnt fully back yet, people are doing technology work with a lot more merit and weight; it takes time, resources and partnerships. Businesses are being more careful.”
One example of hope for a recovered NYC tech sector is the monthly New York Tech Meetup, which has come a long way from its initial gathering of just four attendees in 2004. Now 4,518 members strong with 35 meetups under its belt, the group meets on the first Tuesday of each month and allows six people to have five minutes each to demo “something cool” to New Yorks tech community, including “geeks, investors, entrepreneurs, hackers, etc.”
An event slated for Sept. 29 already has 96 RSVPs, according to Meetup.com.
“Great group,” gushed a commenter on the N.Y. Tech Meetup site named Nate Westheimer on July 10. “Silicon Alley 2.0 wouldnt be what it is without it.”
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