Signs of recovery emerging in Silicon Valley

image
Author: Alan Markow
Published: 07 Jul, 2010
Updated: 13 Oct, 2022
3 min read

Two important signs of economic recovery turned up in the San Jose Mercury News this week.  First is an apparent boom in the chip industry, and second is an uptick in business at Buck’s Woodside Café. 

The Semiconductor Industry Association (SIA) announced that May sales had surged to a record $24.7 billion dollars.  Because of the ubiquity of chips in products ranging from refrigerators to airliners, semiconductor production can be viewed as a leading indicator of a market recovery, and the SIA is predicting a near 30 percent increase in sales for the year. 

Of course, the industry was hedging its bets a bit in its announcement.  SIA president George Scalise noted “the semiconductor industry's growing sensitivity to macroeconomic conditions," including declining consumer confidence and pressure to reduce government spending.  But, it is the positive side of macroeconomics such as growing worldwide markets, pent up demand by businesses to replace outmoded equipment, and a rebound in traditional industries such as automotive that are driving the chip market barometer into positive territory, though some of these indicators have been dipping as of late. 

Semiconductors enable technology developments such as longer battery life in cell phones, safer automatic landing systems on airplanes, and more secure anti-lock brakes on automobiles.  They also provide the touch-screen controls that we all demand of everything from iPads to sewing machines. 

So, you might argue that what’s good for the chip industry is good for General Motors and America.  But, a robust chip industry will not bring back large numbers of jobs in the United States.  While American companies such as Intel dominate the chip market, more and more of their manufacturing has already moved overseas.  And even the U.S. based wafer fabrication facilities (known as wafer fabs) have little effect on employment numbers because they are so heavily automated. 

In fact, the chip industry has been outsourcing its most labor-intensive work (known as packaging and testing) for decades to countries such as Malaysia and Singapore. 

So, that brings us to better news about the future over at Buck’s.  This Silicon Valley landmark is rightly known as the deal-making capital of the region, and these days, it’s a full house for breakfast.  Venture capitalists, angel investors and entrepreneurs are spinning out new ideas while they consume their yogurt and granola or Buck’s famous pancakes. 
Not too many months ago, according to owner Jamis MacNiven, “it was as bleak as it has been.”  But the business cards are flying once again at Buck’s, and new ideas, such as the Tesla electric vehicle, are in serious discussion by the elite of high-tech. 

MacNiven and his wife (who co-owns the café) have seen the high and the mighty at this unconventional watering hole:  Warren Buffett, Nicolas Sarkozy, and Michelle Pfeiffer are among the names the couple can rightfully drop.  Buck’s was one of my haunts when I worked in high-tech, and I recall a time when secret service types came in, followed by the arrival of a long, black limousine and a guy we all thought was the Prime Minister of Israel. 

IVP Donate

What’s important about Buck’s is that it’s another sign that the Valley is humming with business development, and real money is changing hands.  Let’s hope the SIA is right and the chip market continues its boom, and that there’s a line outside of Buck’s for many months to come.

Latest articles

CA capitol building dome with flags.
Why is CA Senator Mike McGuire Trying to Kill the Legal Cannabis Industry?
California’s legal cannabis industry is under mounting pressure, and in early June, state lawmakers and the governor appeared poised to help. A bill to freeze the state’s cannabis excise tax at 15% sailed through the State Assembly with a unanimous 74-0 vote. The governor’s office backed the plan. And legal cannabis businesses, still struggling to compete with unregulated sellers and mounting operating costs, saw a glimmer of hope....
03 Jul, 2025
-
7 min read
I voted buttons
After First RCV Election, Charlottesville Voters Back the Reform: 'They Get It, They Like It, They Want to Do It Again'
A new survey out of Charlottesville, Virginia, shows overwhelming support for ranked choice voting (RCV) following the city’s first use of the system in its June Democratic primary for City Council. Conducted one week after the election, the results found that nearly 90% of respondents support continued use of RCV....
03 Jul, 2025
-
3 min read
Crowd in Time Square.
NYC Exit Survey: 96% of Voters Understood Their Ranked Choice Ballots
An exit poll conducted by SurveyUSA on behalf of the nonprofit better elections group FairVote finds that ranked choice voting (RCV) continues to be supported by a vast majority of voters who find it simple, fair, and easy to use. The findings come in the wake of the city’s third use of RCV in its June 2025 primary elections....
01 Jul, 2025
-
6 min read