Jobless workers in Silicon Valley are giving up on the region’s dominant technology industry and trying to switch to other fields, as the area’s unemployment rate spikes above the national and state average.

Job centers and community colleges across the region are reporting a surge in enrollment of out-of-work techies, with many looking to move into other industries. While data on the shift are scarce, the trend is evident at ProMatch, a government-funded organization in Sunnyvale, Calif., that helps unemployed professionals network, retrain and land new jobs.

Since the start of the year, ProMatch has seen its ranks swell from 180 attendees to its maximum capacity of 225, says Connie Brock, who helps run the group.

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The Huffington Post has launched a new monthly feature it’s calling the “Real Misery Index,” which it says offers a more accurate snapshot of the economic struggles Americans face today than the original one.

Developed in the 1970s by Arthur Okun, a Yale and Brookings Institution economist, the Misery Index is calculated by adding the unemployment rate and inflation rate.

“Unfortunately, it’s not a very useful statistic,” HuffPo’s Marcus Baram writes, since its unemployment figure excludes part-timers and people who have stopped looking for work.

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In a world of double-digit unemployment and old-line industries in mid-collapse, here’s a sales pitch tailor-made for the times: “Get Paid by Google” (GOOG).

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I don’t often look to movies about beer for poignant macroeconomic commentary, but as February ended with an 8.1 percent unemployment rate (and rising), a line from “Strange Brew” struck me as particularly relevant. As they’re introduced to their new jobs as the only two workers on the bottling line, the Mackenzie brothers are told: “Welcome to 1984, the age of automation and unemployment. The rise of the machine and the fall of man. The end of the human era.”

Will cloud computing, as some predict, be to information technology today what automation was to the assembly line in the ’80s? If so, what happens to those jobs? To the people who used to do them?

The impact on the bottom line is impossible to deny. Cutting IT costs while maintaining, or even improving, performance levels saves jobs in other departments and might even help keep the company afloat. When done right, the savings realized from server consolidation are well documented, and they only improve when cloud-like levels of virtualization, automation and outsourcing come into play. The cold, hard truth is virtualization and cloud computing let IT departments do a lot more with a lot less.

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It’s not just kids who are Googling “unemployment.” Grandma and Grandpa are looking for jobs online too.

Nearly 3.6 million people age 65 and older visited career-development Web sites in January, according to a Nielsen Online report released Thursday.

The majority of job site visitors–18.7 million–are still between the ages of 35 and 49. But people 65 and older were the fastest growing group by far, up 41 percent from the same time a year prior.

Chuck Schilling, research director at Nielsen Online, says the figures represent a “desire to stay employed longer” in order to “sock away more retirement savings.”

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Even as economic losses and unemployment levels mount, America’s most effective engine for wealth and job creation is being dangerously–perhaps fatally–compromised.

For more than 30 years the entrepreneurship-venture capital-IPO cycle centered in Silicon Valley has generated new wealth, commercialized innovation, and created new companies and industries. It’s also spun off millions of new jobs. The great companies created by this process–Intel (INTC), Apple (AAPL), Google (GOOG), eBay (EBAY), Microsoft (MSFT), Cisco (CSCO), to name just a few–have propelled most of the growth in the U.S. economy in the last two decades. And what began as a process almost exclusively available to scientists and engineering Ph.D.s became open to just about anyone with a good business plan and a healthy dose of entrepreneurial drive.

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Bernstein Research analyst Jeffrey Lindsay this morning cut his ratings on both Amazon.com (AMZN) and eBay (EBAY) to Market Perform from Outperform, noting that the stocks have rallied off their November lows toward his target prices of $50 for Amazon and $16 for eBay. Given the current macro environment, he writes, there is little upside to current 2009 estimates, with increased risk of reduced guidance or under-performance.

For Amazon, he has three major concerns:

Reduced discretionary spending as unemployment and home foreclosures further erode U.S. consumer confidence. He notes that “the vast majority of goods sold by Amazon are discretionary purchases.” He says consumers have “pulled out all of the stops for the holiday season”–have they?–he expects “much more cautious and restrained spending as redundancies and home foreclosures continue as expected through 2009.”

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Corning (GLW) plans to cut the production capacity of its wholly owned glass business by 30-40 percent in response to a slowdown in the LCD television market, CFO Jim Flaws said this morning in an interview with Tech Trader Daily on the company’s disappointing fourth-quarter outlook.

Flaws noted that the company has been operating with a “conundrum in the LCD business” for most of the year: While there have been constant fears about the economy, LCD demand through most of the summer remained strong. But he notes that after Labor Day, weekly data have shown a decline in LCD TV sales at retail. Flaws says the combination of rising unemployment, low consumer confidence and weak financial markets has lead people to “retreat” on LCD television spending. He says unit growth is still positive, but nowhere near the 37 percent level seen in the first eight months of the year.

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