Economic slump reaches tech industry

NEW YORK, Nov. 15 (UPI) -- The global economic downturn has suddenly hit the technology industry hard as U.S. consumers cut back on electronics spending, analysts say.

The tech industry had seemed fairly resilient in the face of the broader economic downturn, but that abruptly changed late last month as U.S. consumers stopped buying previously immune products such as laptop computers and iPhones, The New York Times reported Saturday.

Such industry leaders as Intel and Nokia have warned of slowing sales and tech stocks took a pounding on worldwide exchanges. Leading electronics retailer Best Buy Inc. declared this week that "rapid, seismic changes in consumer behavior" has made for the worst market in its 42-year history, while Nokia, the world's largest maker of cell phones, said global sales would fall in 2009, only the company's second-ever sales decline.

Computer maker Sun Microsystems announced Friday it would lay off as many as 6,000 employees, or 18 percent of its workforce, the Times said, adding that some executives are comparing the current situation with the "dot-com bust" of 2000, when hundreds of companies disappeared.

October "was like turning a switch," Robert Barbera, chief economist at Investment Technology Group, told the newspaper. "Everything pretty much shut down."