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  Issue No 83 Official Organ of LaborNet 09 February 2001  




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After the Gold Rush

By Phil Morgans

Recent mass sackings at high-profile e-businesses are beginning to expose the flimsiness of the 'jobs for all' predictions made on behalf of the sector.


While it would be churlish to dismiss out of hand the employment opportunities e-business will provide in the future, the gathering pace of retrenchments and what they reveal about many e-businesses serve to remind us that 'new economy' workers are indeed of the same species as 'old economy' workers.

Job losses at US and Australian dotcoms are running into the thousands. Companies that have shed jobs in the last few weeks alone include LookSmart (170 jobs), AltaVista (200 worldwide), NBC Internet (150) and content management software developer, Vignette (350). CNN announced last week it would be cutting 400 jobs. CNN's announcement came less than a week after CNN parent company Time Warner completed its merger with AOL. CNN group head Jim Walton said, "the interactive and television network functions have to be more closely aligned and placed under a single management structure". This probably means interactive and television network content will become almost indistinguishable.

While downsized dotcommers of the world are yet to unite, they have created an outlet through which they are venting their anger and frustration at their sudden change of fortune. In the process they are also providing some interesting insights into the world of e-business. describes itself as "a game based on the classic deadpool, but instead of betting for (or against) people, you're betting on companies." rates different levels of a tech company's demise and awards points on the level of severity based on criteria including the number of jobs lost. Apart from giving disgruntled former dotcommers somewhere to air their grievances, is a source of news and gossip about dotcom businesses.'s main focus is on breaking and aggregating news and stories about dotcoms, although it isn't easy to find much good news. As Dotcomscoop says, "If a lot of the news is negative, that's the unfortunate truth of the state of the business at this time."

Among the inevitable dross that appears on the sites' online forums (proving that the proportion of dotcommers requiring detention in a psychiatric institution is roughly the same as that of the general population), there are some gems such as this one posted on Dotcomscoop last week:

"I work for a dotcom. Our CEO has been caught forging purchase orders to the tune of $5 million dollars a pop in order to bring our revenue up to a level so our share price didn't fall.

"Since then, we have been de-listed by NASDAQ, our CFO is gone, we have had to lay off 25% of our staff (nice christmas pressie eh) and a spending and hiring freeze has been implemented. I won't be getting a raise or a bonus, despite exceeding my targets through many late nights and hard work (some of which jeopardised my relationship with my wife).

"I am pissed off. We all own stock and this lying crook has fucked us all. Myself personally, I have gone from retiring in 2 years a rich man to having to start all over again. I don't know that my marriage is going to survive that. Fucker! We might pull up out of this nosedive, but even if we do, it's going to be a long time before we are going be back in the game."

While this might suggest some latent desire among dotcom workers for a counter to the power of dotcom companies to fire them at will, employers are already making plans to thwart any attempts by unions to organise on the back of the hard times befalling their employees.

According to the e-business web site,, Australian e-businesses need to be on their guard against union incursions into their workforce. Citing increasingly insecure US dotcom workers loaded up with worthless stock options turning to unions for help, Australian companies are being advised to start developing their union-busting strategies now.

Late last year, a worldwide union organising campaign was launched among workers at online retailer The campaign, backed by the Washington D.C. based Prewitt Organising Fund, involves Amazon workers throughout the US, France and Germany. The CWA affiliated Washington Alliance of Technology Workers has launched a similar campaign at the company's Seattle headquarters.

Amazon's response was predictably cool. Amazon CEO Jeff Bezos believes that unions are unnecessary at the company because everyone has stock options. Amazon workers hold share options exercisable at US$67. Amazon's share price was about US$24 in the week leading up to the announcement of the union campaign. Amazon has also started holding manadatory meetings with employees to address union questions, and has instructed managers on how to respond to organising efforts.

Even before the union organising campaign was launched, Amazon announced that it would outsource some of its customer service operations to India, where labour costs are far less than those in the US. Amazon is believed to be planning to have up to 80% of its customer service work done in India. WashTech estimates the monthly wages of a customer service employee in India at a maximum of about US$175, while the same worker in Seattle would earn about US$1,900.

Just days after employees submitted a petition to hold an election for union representation, consumer electronics content provider laid off nearly a quarter of its workforce, claiming the layoffs were paradoxically "part of a move to move away from the business-to-consumer market and toward profitability." The company also confirmed the workers would not receive a severance package.

As with all organising efforts, timing is crucial. The sharp increase in layoffs has made everyone aware that the labour shortage in web-related occupations is over. It's crunch-time for a whole generation of workers occupying places in the labour market that barely existed a decade ago, who are used to earning serious money and haven't experienced a recession in their adult lives.


*   Have you been screwed by a dotcom? Let us help you vent your spleen!

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*   Issue 83 contents

In this issue
*  Interview: Dispatch from Davos
ACTU President Shahran Burrow reports back on the trade union movement’s presence at last week’s meeting of the heavyweights of global capital.
*  Unions: After the Gold Rush
Recent mass sackings at high-profile e-businesses are beginning to expose the flimsiness of the ‘jobs for all’ predictions made on behalf of the sector.
*  Economics: The Other Davos
While the world’s business leaders met in Davos, a very different gathering was taking place in Porto Alegre, Brazil. Pat Ranald was there.
*  Politics: While We Were Snoozing
As we lay in our banana chair through summer the political world kept turning with a new man in the White House. Here’s what we missed while we were off the air.
*  History: Federation Day, 1901
One hundred years after Australia became a nation, Ralph Sawyer relives the original Federation Day through the eyes of Billy Hughes.
*  International: Burma: The Struggle Continues
As the internatinal community moves to bring Burma to account, APHEDA - Union Aid Abroad is working on the ground.
*  Review: Inside the Journopolis
In his new book, Rob Johnson brings the infamous Cash for Comment Affair to life.
*  Satire: Families Demand Longer Work Hours
A new report confirms the long held suspicion that employees who reduce their workload to spend more time with their spouse and children just end up annoying their families even more.

»  Union Busters Target Call Centres
»  Workers Take Message to World Bank
»  Korean Worker Bashed for Questioning Wages
»  Steelworkers Draw The Line
»  Sartor Thanks Workers for Games by Outsourcing Jobs
»  Outworkers Still Waiting for Action of Sweatshops
»  Workers Casualties in Wentworth Fire Sale
»  Fantastic Win for Furniture Workers
»  Billions Spent on Mine Takeovers
»  No Guarantees on Orange Jobs
»  M5 Project- Worker Pays the Price
»  Forum: Organising Youth in a Hostile Workplace
»  Western Sahara Marks 25 Years of Waiting
»  Action as Australia Considers WTO Ties

»  The Soapbox
»  Sport
»  Trades Hall
»  Tool Shed

Letters to the editor
»  Cavalier Attitude to Cricketers
»  Unions and the WEF: How should unions bridge the divide?
»  Botsman's Ivory Tower
»  Volunteering a Modest Proposal
»  Well Done, Workers Online

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