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Hire Anxiety: Layoffs Jolt Burlington-Area Tech Sector

Thursday, November 7, 2019   (0 Comments)

When Miami-based e-commerce company Mi9 bought homegrown software firm MyWebGrocer in October 2018, Barry Clogan, the Winooski-based tech darling's president of retail solutions, hailed the sale as a win for local employees.

Clogan said none of the employees remaining in the company's historic Champlain Mill headquarters would lose their jobs.

What a difference 12 months makes.

According to two employees who spoke to Seven Days recent layoffs have left about 43 people at the Winooski office, down from 150 when the firm was sold.

October has been a cruel month for some of the Burlington area's most prominent tech firms, raising questions about the vibrancy of the much-vaunted tech hub that Burlington has worked so hard to foster., which creates and manages websites for car dealerships nationwide, said on October 23 it had cut fewer than 15 positions from its 1,100-strong workforce during two rounds of layoffs.

The following week, Social Sentinel, which alerts school districts to potentially threatening public social media posts, laid off 19 people, shrinking from 45 employees to 26. Officials characterized the 42 percent workforce reduction as a way to reposition the privately held firm to focus on unspecified markets beyond schools.

In many cases, Vermont tech companies' fortunes are tied to cycles of the broader industries they serve, and that may have been the case with some of the recent cutbacks, said Jeff Couture, executive director of the Vermont Technology Alliance, a business group that represents and advocates for 200 tech firms in the state.

Mi9 had been posting jobs on the alliance's website, but that has tapered off, and the company recently declined to renew its membership, Couture said.

The smaller scale of the state's tech industry means "layoffs can be felt here a little harder than elsewhere," Couture said. But like other tech leaders, Couture sees strong demand at smaller tech firms that are aggressively hiring.

"There are a lot of interesting, dynamic, small tech companies you may not have heard of that are growing, that are doing well, that you could be a part of, where you can get paid well and live in Vermont," Couture said.

David Bradbury, president of startup incubator Vermont Center for Emerging Technologies, said nothing he's read about recent layoffs tells him the companies' futures are anything but "bright and vibrant." He said the broader tech job market is hot right now.

"From our perspective, we are seeing really large net new hiring demand across sectors," he said.

Read the full Seven Days article by Kevin McCallum