For the past year dot.com companies have been crashing at the rate of one a day. Thousands of e-kids and even some wise old heads have lost their jobs as, one after another, e-tailers and other unstable e-businesses have gone bust.
And they are not the only ones to suffer. Some of the largest and most profitable companies in the country have been quietly dispensing with the staff they took on last year to match the efforts of the nimble start-ups.
BT announced in February that it intended to cut 20% of its staff from its internet division BT Openworld, after the division alone reported losses of £107m last year. What was to be a mega portal is now to be a slimmed down web service for businesses.
The cuts were swiftly followed in March by media group Emap, which slashed its internet spending for the second time in four months with the loss of up to 100 jobs. In April the Financial Times group announced plans to trim its online workforce by 10% by the end of the year.
Last week the ITV network said the huge fall-off in advertising from dot.com start-ups was responsible for a dive in profits and Granada Media, one of the two network operators, promptly said it would be chopping 100 managers as part of a scheme to save £20m.
Even worse, the shake-out from the highly publicised downturn in technology stocks has even begun to affect back-end companies who supply the hardware, ISPs, software and services, which means they too will suffer job losses in the coming months. Cisco and Intel, two barometers of the technology sector in the US, have performed badly leading to yet more falls on the world's stock markets. Both have signalled that lay-offs are to come.
Electronics companies Psion, Ericsson, Siemens, Philips and Motorola have also reacted to a slow down in the sales of mobile communications gizmos with job cuts. The failure of internet enabled Wap phones has hit these companies hard.
Feeling the domino effect, retailers have also been forced to scale down their investments in internet operations. M&S and Somerfield balked at the need for huge investment when the result was only small sales in the web divisions.
Budgens joined the dash back to bricks and mortar retailing. Chief executive Martin Hyson believes the jury is still out on whether online food shopping will succeed. "Customers just didn't want to shop online. They'd rather come into the shop. We believed it would be far bigger than it was," he said.
But even though dot.coms are still going to the wall and many traditional companies continue to cut back, industry watchers insist there is no need to panic and that the industry is still healthy.
A recent report from the Confederation of British Industry and management consultants KPMG found that while the rate of growth has not been spectacular there has been a steady increase in the number of businesses which are embracing new tech nologies and using them to streamline their business processes.
Pamela Taylor, an e-business policy advisor at the CBI said: "There was a belief that the internet was going to revolutionise everything but that has been replaced by the more realistic view that we are going to see a more natural pace of growth."
Ms Taylor thinks it is no surprise that out of the latest round of job cuts the companies involved have either been media or retail companies. She says that the fundamental problem with media websites is no one ever worked out how they were meant to make money.
"There was always an idea from the beginning that content should be free and that the consumer would be unwilling to pay for the information. The Nap ster case in the US has gone some way to dispelling that myth." The swelling number of media websites that rely on advertising also means there are more competing for the same amount of advertising.
A high profile faller was the new economy magazine, The Industry Standard, which recently closed its European publication just six months after its glitzy launch, with the loss of 60 jobs.
Bill Thompson, who set up one of the first internet recruitment websites in Britain, says the e-commerce jobs market is now experiencing the same sort of problems facing the wider economy. Although there are lots of jobs available the skills base in this country does not match the shortage.
The shift in emphasis towards business-to-business models means there has also been a change in the type of skills required by the industry. It's no longer enough to be able to create a flashy website, as the skills in demand now are found in the back end of the industry in strategy, design and knowledge of deep technologies that power the web.
The new economy is desperate for computer people - analyst programmers, software engineers, network specialists and other skilled workers. Recent research by analyst firm IDC indicates that by 2002, there will be a shortage of almost 81,000 qualified networking professionals in the industry across the UK. For wider IT skills, the shortfall is likely to grow to 1.7m vacancies by 2003 - 20% of the total number of IT jobs.
Bill Thompson says: "Times are harder, but people with good technical skills will always be able to find jobs. On the other hand people who have not got the right skills are finding that the industry has become more selective and that they can't rely on walking into a job any more."
A spokeswoman for Computer People, a recruitment consultant specialising in e-commerce, says that the downturn has led to a reduction in recruitment in permanent positions over recent months. Short-term or contract work is increasingly available: "This type of staffing is much easier to justify financially over the short term - for example, if projects are shelved, the contract staff can be released at a much lower cost than a similar permanent staff member."
And it's not just IT support or technology jobs that have suffered as a result of the recent cuts, either. Out of the 40 jobs lost at ft.com in April, at least a dozen were in editorial positions, with further cuts in the sales and marketing divisions.
Simon Appleton, chief executive and founder of internet recruitment consultant Planet Recruit, says this shouldn't worry people looking for positions in the online job market. He says that because e-commerce is becoming more mainstream there is no longer a need for sales or customer service e-commerce specialists, people with those skills should be able to move back and forth between "traditional" and e-commerce jobs with ease.
"I think it's apparent that almost any job these days is far more wired than, say, three years ago, so everyone is gaining a level of comfort, if not skill, with the technologies. It's not a big leap from 'level of comfort' to 'able to sell in that area' or 'able to do customer support' if you have the original skills," he says.
There is also a feeling that while many web-based offshoots are being slimmed down or closed, there are always other opportunities opening up both for people with web skills and the people who write, commission, co-ordinate and manage the content.
The BBC is advertising heavily for staff to provide content for its hugely popular sites. ITV, despite the fall in advertising, is also keen to build up the websites under its banner as opposed to the individual brands such as Granada and Carlton. Channel 4 - which has seen the pulling power of the internet with the phenomenal success of Big Brother - is also expanding its virtual presence.
In retailing, Tesco is taking more than £200m of sales over the web and John Lewis, the department store that is never knowingly undersold, announced last week it is to pump a further £35m into its shopping website service. All of which may just point the way to a more mainstream, and possibly secure, future for many e-commerce workers.
Bouncing back after redundancy
Siobhan Mulholland was made redundant from a teen community and lifestyle website late last year when it collapsed just four months after being launched. Despite receiving £6m initial investment, the site suffered technical problems and the company was unable to raise further funding to continue trading.
Ms Mulholland, now aged 24, says: "We were all called to a meeting one Monday morning and told that the site couldn't pay its way, and it folded there and then. I had my suspicions that something was wrong because I was working in the revenue department at the time and I knew there were no new partnerships or investment coming in.
"It was a huge sock in the mouth to be made redundant at 23. It was really scary, I had only moved down to London six months before that and I didn't know what to do. I knew I had to get another job quickly or I would have had to go back home to Hull to live with my parents.
"I updated my CV and signed up with a specialised recruitment agency and started applying for jobs. All in all I must have applied for around 40 jobs."
It took Ms Mulholland just two weeks to find another job, which she still has, and she says the experience did not deter her from applying for jobs in e-commerce.
"I knew I still wanted to work in the dot.com industry. I had already worked for two websites before that, one of them was in my home town, and I really enjoyed it. I like being part of a cutting edge industry and there's still a lot of room for creativity that you don't get anywhere else."
Jerry Wilson, 29, was working for a computer games company when he was made redundant about eight months ago for the second time. He joined the company as a programmer about a year after it launched its internet site.
He says the site was beset by problems from the beginning mostly due to poor management and a lack of funding. "The company went bust after trying to get further funding. It happened at a time when the market was starting to change and things started going wrong."
He had only been in the job about six months when he was made redundant two months before Christmas. "The management kept saying everything would be okay and that the company would be able to keep going but I had been made redundant before, so I knew what to expect."
Mr Wilson says he was lucky enough to find another job almost straight away at a publishing company. "The first thing I wanted to do was find a big company. The one I was made redundant from only employed about six people on the website and I wanted the security of working for a big firm."
He says the experience hasn't put him off working for a website in the future. "If it was a big company, like HMV, which had a secure off-line business making lots of money, then I might consider working in an online division again. But if it was an internet-only set-up I'd stay away from it."
