MOUNTAIN VIEW, California--At Netscape's campus-like headquarters, workers taking their lunch breaks today were upbeat about the company's prospects despite news of wider-than-expected losses and job cuts.
Those staying on with the company said management was taking the right steps to bolster profitability, while those on their way out said they received generous severance payments. For its part, Netscape emphasized that it will continue to expand its business.
"I'm optimistic about the future," said one engineer who works on Netscape's Web site.
"I think it will become positive," added another who works in Netscape's sales department. "Some of the people who have been burned out during the past few years probably needed to move on."
One marketing employee likened the job cuts to ripping off a Band-Aid quickly--extremely painful at first, though the pain is over with quickly.
Going forward, corporate headhunters warned that the Internet software company now must work hard to build up morale and keep its "best and brightest."
Netscape is not alone in this struggle, and its job cuts are less drastic than recent layoffs at its neighbors, Apple and Seagate Technologies. Attracting and keeping a highly skilled, motivated workforce is a top priority for all of these ailing companies.
"This is the first time that Netscape has ever cut employees," said Jim Zuehlke, a recruiter at Cardinal Mark in Minneapolis, Minnesota. "This hurts the overall employee morale. They look around and say, 'Am I vulnerable, too?'"
"Netscape has to convince its remaining employees that this is not the first of a whole series of layoffs and that the company is essentially healthy," added Jon Holman, president of the Holman Group, a San Francisco-based recruiting firm.
Recruiters also pointed out that the job market for high-tech workers is red hot at the moment, which should ease the blow for many Netscape employees who lost their jobs.
"People are crying for help in tech companies," Holman said. "If one is going to get laid off, this is a wonderful time."
However the flip side of this situation, recruiters pointed out, is that Netscape could find it tougher to hold on to those workers who didn't receive pink slips.
Microsoft is one possible suitor for these workers. But experts doubt that the software giant will resort to the sort of poaching that many industry observers have said is its modus operandi. Workers who leave Netscape "are probably not inclined to go to Microsoft because they have been patterned against it," said Scott Knowles, a Santa Cruz-based recruiter. "I'd say they're more likely to go and join a hot start-up."