After the dotcom crash, the number of jobs in Silicon Valley dropped about 25% from their peak. This affected most people's ability to negotiate better compensa

After the dotcom crash, the number of jobs in Silicon Valley dropped about 25% from their peak. This affected most people's ability to negotiate better compensation because demand dried up. Depending upon the severity of this contraction many different disciplines and professions may experience the same thing. Sequoia folks understand that engineering is a key driver for innovation, the fact that they are telling portfolio CEO's to consider cutting engineering indicates their concern as to the severity and longevity of a contraction.