(Business 2.0) – THINK GLOBALLY, HIRE LOCALLY

Fewer skilled workers are coming to the United States from overseas. During the height of the 1990s boom, 60 percent of H-1B visas--those awarded by the Immigration and Naturalization Service to highly educated workers, mostly from India and China--went to high-tech workers. But as tech layoffs continue, industry demand for foreign workers has plummeted. In Silicon Valley, unemployment has risen from just 2.2 percent in late 1999 to almost 8 percent today.

NUMBER OF H-1B PETITIONS FILED AND APPROVED

10/99-6/00 [FILED] 221,000 [APPROVED] 192,000

10/00-6/01 [FILED] 270,000 [APPROVED] 255,000

10/01-6/02 [FILED] 159,000 [APPROVED] 148,000

STARTUP SHUTDOWN

Remember when an Internet business plan was the ticket to entrepreneurial riches? Defunct companies that were first funded in 1999 and 2000 blew through more than $15 billion, and 20 percent of the startups that received initial financing during the boom have closed their doors. Even when companies survive, their VC backers now find it difficult to cash out through an acquisition or IPO. Of startups funded in 1999, only one in six has returned cash to investors.

FATE OF STARTUPS, BY YEAR FUNDED*

Reached liquidity Still private Out of business

'92 227 63 48 '93 212 78 68 '94 231 106 70 '95 293 168 85 '96 411 254 104 '97 349 374 113 '98 315 528 137 '99 331 1114 397 '00 259 1918 480 '01 19 907 30 '02 2 358 0

*As of August 2002. SOURCE: VentureOne

PATENTS PENDING

Most patent applications submitted to the U.S. Patent and Trademark Office are approved. That's not a tribute to the creativity of American inventors, but a reflection of the PTO's indiscriminate approval process--a system that often generates overlapping patents (and expensive litigation). After loosening up during the 1990s, patent offices in Japan and Europe have again become more rigorous.

KINGS OF E-COMMERCE

Catalog retailers are still the masters of selling online. Nearly three-quarters of them report that their Web operations are profitable. With their established warehouse, shipping, and call-center facilities, catalog companies are extremely well-suited to the rigors of e-commerce. But many of the surviving Web-based players also are making significant gains. In 2000, barely 27 percent of pure-play e-commerce companies were profitable. This year, twice as many are in the black.

AVERAGE 2002 PROFIT MARGIN FOR ONLINE OPERATIONS

Catalog-based companies 6% Store-based companies -5% Web-based companies -13%

RETAILERS TURNING A PROFIT ONLINE

[Catalog-based companies] 73% [Store-based companies] 51% [Web-based companies] 55%

SOURCES: Shop.org; Boston Consulting Group