The once bubbly and booming big tech industry is now coming to face a harsh reality, as profits shrink against the backdrop of wider economic problems as inflation remains stubbornly high, interest rates keep climbing and venture capital funds start to dry up.
After seeing more than a decade of stratospheric expansion, where household names in Silicon Valley scooped up some of the industry’s top talent - thousands of techies are now finding themselves without a job as companies around the world are slashing jobs to keep up with rising costs and slowing economic activity.
So far this year, the U.S. tech industry has seen more than 95,508 tech layoffs, following more than 160,000 layoffs last year.. The destruction of the tech industry has been long-standing, after enjoying massive growth spurts and hiring thousands of new employees during the pandemic when business was booming.
Now, with consumers pulling their purse strings tighter, and the cost of living spiraling, heavy-weight names are finding themselves having to reduce headcount to sustain themselves on the possibility of a recession looming ahead.
Back in early January, eCommerce giant Amazon announced that it will be cutting more than 18,000 jobs. Meta laid off 11,000 techies, with Stripe, Microsoft, and Snapp all axing around 1,000 or more employees. Even the likes of Salesforce, PayPal, Microsoft, SoundHound, and Shopify have already made cutbacks and scaled back their hiring.
Amidst the bloodshed, iPhone maker Apple has yet to announce any potential layoffs, making them one of the last remaining household tech names that have been untouched by the mass tech job extermination.
Since the industry’s inception more than two decades ago, a lot has changed and tech workers that have recently found themselves without work are now entering a bizarre job market that can’t offer them the perks and benefits they once enjoyed.
Techies Turn To Public Service
In the wake of mass layoffs, some tech workers have left their castle on a hill in Silicon Valley to pursue what some may argue as something more “meaningful” and “resourceful.”
Changing jobs and industries is one thing, but jumping from the private sector to working in public services is a completely different ball game that tech workers are now embracing as layoffs continue and economic slowdown looks more and more imminent.
In a bid to score some of the top tech talents out there, some public entities such as The U.S. Department of Veteran Affairs have posted around 1,000 job openings to attract the best possible candidates. While the work might not seem as interesting, techies could be working to solve modern software problems, and helping to revamp medical appointment scheduling systems.
Governments around the world have been investing billions in tech innovation, providing capital funding for private companies and nonprofits to develop new tools and resources. The development has seen a slew of tech-related jobs being posted, but have remained vacant as soaring Silicon Valley paychecks and other office perks attracted top talent.
Different sectors within the public service ecosystem, including green tech, cybersecurity infrastructure, healthcare, data analysis, statistics, logistics, and supply chain are all now seeking to take advantage of the wave of recently unemployed tech workers.
So these jobs may not offer the excitement that the tech industry did, or come with a paycheck to make up for it, but in times where economic uncertainty is high, and markets are slowing, tech workers are taking back control and looking for new opportunities that can provide them with the tools and resources they need temporarily.
While it’s not to say that top tech talent will remain in the public service industry for decades, or even several years for that matter, the competitive job market has left many with limited options to choose from.
Although a few hundred or thousand job openings at several government agencies can’t make up for the more than 200,000 tech layoffs over the last year, techies could find themselves embracing new opportunities and challenges outside of the industry as they start to shift their perspective.
The Tech Job Market Has Changed
When the economy boomed, big tech enjoyed the ride along, seeing profits soar and experiencing spurts of mega growth. At the same time, these companies offered techies hefty paychecks, travel perks, and other attractive office benefits to outpace rivals.
Scooping up the best talent meant paying techies more, or giving them better workplace benefits including access to virtual events, outside of their regular compensation packages.
Yet, now as the economy starts to slow down, and companies are seeing profits shrink, many are reconsidering these perks, and as we’ve seen, many are giving their employees the boot to help cut costs.
During the height of it all, tech workers could easily jump from one company to another, as long as the competitor offered them more money and better benefits. At one point, tech workers enjoyed a plethora of job opportunities, as the industry boomed on bullish investor sentiment and consumer demand.
But the market has since changed and more laid-off tech workers are seeing companies offering them smaller pay, minimum benefits, and limited job security. A number of new job postings have also been for temporary or contract roles, limiting the options for some tech workers who are seeking a more permanent and full-time position.
Instead of companies hiring tech workers to innovate and develop new products or services, many are rather looking for professionals that can do what some may consider mundane jobs such as software engineering, information technology, logistics, and supply chain.
The days of tech workers being able to jump ship once they were offered a better opportunity have come to an end - for now at least. The luxuries of the once glimmering tech industry that offered employees bountiful benefits unmatched by public service jobs and startups have made it hard for techies to find suitable work that can abide by their lifestyle and work-life prerequisites.
When things start going south, it seems as if the once-glimmering tech industry has lost all of its allure in a short while, spitting out thousands of employees, and leaving them with a sour taste in their mouths.
The Not-So-End Of Tech
So the tech industry is perhaps experiencing a slump in performance as market and macroeconomic problems continue. This however isn’t the dire end of the once bubbly tech industry. There is a slight chance that once circumstances start to improve again, those companies will look to hire or take back some of their previous employees.
It’s not the end of tech, just yet, and we could still see more layoffs in the coming months, but this could put the industry in a predicament it hasn’t yet prepared itself for - bringing back employees that have found more profound and meaningful opportunities outside of the industry.
As the situation continues to unfold, and techies either start working in public service, for startups, or even look to embrace entrepreneurial opportunities, many tech companies could find it harder to attract top talent.
Even with big paychecks and office benefits, the scene has been set, and many techies will use this as a learning curve that jobs are temporary, and the real difference they have to offer is still out there.