“My offer was rescinded.”
These four words now seem to fill the homepages of LinkedIn, overshadowing the once positive announcements of exciting new professional opportunities. Reports of rescinded offers, layoffs, and hiring freezes all seem to be concentrated within the tech industry, calling into question what the future will look like for many job seekers looking to break into this field. Is this sudden slowdown just a phase caused by spiked fears and panicked decisions? Or is this a larger, more permanent trend? Let’s explore together what might be in store for the tech sector as we move into the second half of 2022 and beyond…
1. The Slowing of A Boom?
Bad news first. According to Layoffs.fyi, 60 tech companies have laid off workers in the month or so between April to May 2022, accumulating to over 16,000 workers now without a job. Notable among these companies is Netflix, who laid off 150 workers presumably as part of their efforts to “get costs under control” (said by Netflix CFO, Spencer Neumann, after the company lost 200,000 subscribers in Quarter 1 of this year). Other major tech companies, such as Meta, Uber, and Salesforce have announced hiring freezes while companies like Coinbase and Twitter have gone the route of rescinding offers. This collective sucker punch for employees and job seekers comes at a time in which high interest rates and global discrepancies have led to alarmed talks of a recession. This uncertain future of the economy combined with an observed downturn of tech stocks in the beginning of 2022 is more than enough to lead companies to continue to cut down on costs.
Now the good news. Many job listing sites have stated that the number of openings in the tech sector remains strong, with postings for software developers in the US still up 120% from early 2020 levels (Financial Times). Overall, employees are still leading with the upper hand as “There are way more jobs than people who are chasing these jobs,” (Sinem Buber, lead economist at ZipRecruiter). It seems as if the companies experiencing the most alarming trends in layoffs and hiring freezes are the ones who experienced the greatest boom during the pandemic. This boom is not infinite, however, and, according to PitchBook analyst Kyle Stanford, “Realistic growth, sustainable growth is probably what companies are going to be looking for.” So while this cutback might seem alarming when compared to the massive expansion that has defined the past two years, there’s no need to panic (just yet) as more efficient growth seems to be on the horizon.
2. The Rise of Freelance and Freedom
In December 2021, around 4.3 million workers either quit or switched jobs (Washington Post). Just a month prior, the “quit rate” was the highest it has ever been in 20 years (Pew Research Center). Known as The Great Resignation, this movement was spurred by the onset of the pandemic but is the result of numerous deep-rooted issues within America’s working culture. According to a survey from the Pew Research Center, “low pay, a lack of opportunities for advancement and feeling disrespected at work are the top reasons why Americans quit.” As a result, values of freedom and flexibility have grown among workers — especially after experiencing the pandemic’s work from home policies — which has led and will lead many in the tech sector to turn their eye to freelancing.
In an interview by Forbes with Pat Petitti, co-founder of Catalant (a freelance marketplace platform), the CEO states that many of the highly-skilled tech individuals the company works with are those who “left the corporate world for opportunities that offer more freedom.” He also projects the amount of freelancers to continue to grow over the next decade as new technologies continue to open opportunities for generating money through one’s own work.
3. Transparency For the Win
The conversation about salary transparency has been a hot topic for months now. Especially in the extremely male-dominated tech industry, where only 17% of major technology jobs are held by women (World Economic Forum), being open about employee salaries could be a major tool in tackling the gender wage gap. Previously, this movement towards increased transparency has mainly been led by the workers themselves. On social media, many tech creators share how much they make in their roles as well as their salary progression throughout their career. In informing job seekers how much they should be earning, it empowers the workers to know their worth and not undersell their efforts. It seems as if bigger tech companies are beginning to reflect this sentiment and are now aiding in improving the transparency in their work culture. On June 8, 2022, Microsoft announced that they will be publicly disclosing the salary ranges in all of their job postings no later than 2023. With a tech giant taking this step towards pay transparency, it’ll be interesting to observe how other companies in the industry will follow in the upcoming months and years.
The tech industry is ever evolving, whether it be for better or worse. Knowing how it will change is important for determining how you will choose to push forward. At Sedna, we help individuals adapt to this changing environment, making it easier to accomplish the next step in their career journey. So, no matter where you are in the job seeking process, how can Sedna help you?