Three months on from losing her job, Ana is still in shock. The partnerships manager had been at Meta for seven years when, in November, she discovered she was one of more than 11,000 workers being let go. “I grew up at the company,” says Ana, who asked for her name to be changed to avoid jeopardizing her future career. “I felt safe being there for so long—it was my home.”
Ana thought she was in her dream job for life. But she’s now setting up her own freelance consultancy business, based in Los Angeles. “I met some really cool people at Meta and I still feel a sense of loyalty to them, even now,” she says. “I know it’s nothing personal and just a business decision, but it sucks.”
For years, Big Tech jobs were thought of as being as secure as they were prestigious. But the stories of laid-off workers like Ana mean prospective recruits are thinking twice about a career at the industry’s leading companies. As tech sector layoffs cut deep, job offers have been rescinded, long-term employees have had to find out whether they still have a job based on whether their login credentials still work, and workers on employment visas have suddenly found themselves having to leave their adoptive countries.
This hesitancy is notable among workers at the beginning of their careers. For the past few decades, graduates of the world’s top universities have been aggressively courted by Big Tech, with Silicon Valley giants offering six-figure starting salaries straight out of school. But with layoffs and hiring freezes across the sector, this pipeline of talent is starting to buckle, as graduates think twice about entering an industry that’s already axed 100,000 jobs this year.
“Students right now are more worried about taking tech jobs,” says Nicholas Bloom, professor of economics at Stanford University. “These roles now come with a dose of fear that even if you get a job, it will be canceled before you begin, or worse, after three months.”
Amazon’s 18,000 staff cuts have included fresh recruits. In January, Meta withdrew offers to at least 20 recruits due to start in its London offices. In the US, discussions of rescinded job offers on professional social network Fishbowl were up 161 percent year-over-year in January 2023. The uncertainty over whether companies will honor signed contracts is deterring some graduates.
“A student of mine was lining up interviews with several tech firms,” says Bloom. “But when the hiring freezes started she pulled out of all of them—including the ones still hiring.”
Prospective tech recruits are now opting for seemingly safer career paths elsewhere. While Big Tech is undergoing a hiring freeze, there are still many other white-collar industries with talent shortages. “Current students are aware that many folks hired last year have been laid off,” adds Bloom. “Although tech is still seen as the leading employer, its star is definitely tarnished.”
Layoffs, which have occurred across Big Tech’s European offices as well as their US headquarters, could help smaller tech companies and businesses in other sectors—such as industrial, retail, and government—that have struggled to compete for tech talent over the past few years.
“With Big Tech no longer aggressively recruiting, we’re seeing a rebalancing toward small- and medium-size businesses who struggled to find talent in 2022,” says Craig Freedberg, a regional director of technology at recruitment firm Robert Half, based in London. “Last year, providing a [tech] client with two candidates meant you were doing well as a recruiter. Now, you might be able to have a few candidates in play—even though there are still plenty of unfilled tech vacancies in the UK.”
One startup boss who is already benefiting from the funneling of Big Tech workers to smaller companies is Laurent Descout, CEO and founder of Barcelona-based fintech company Neo. “What has been Big Tech’s loss has been startups’ gain,” he says. “Before these layoffs, Big Tech was able to hoover up all sorts of talent in the market, offering large salaries, huge benefits, security, and the opportunity to work for a household name. But workers are now doubting their stability—they’re looking to up-and-coming firms rather than the industry giants.”
With Big Tech no longer offering a job for life, Descout says tech workers are now rethinking what they want out of their careers. “There’s a growing realization that playing a bigger role in a small firm, and getting meaningful equity, can be a lot more fulfilling than just being a small cog in a big machine at a larger tech firm. We’ve had more applications from senior, experienced, skilled people than ever before.”
However, amid the tech slowdown, startups aren’t guaranteed to keep hiring. Venture capital flows into the tech industry have slowed and many startups are planning for more straightened times.
“When Big Tech announces it’s slowing down and needs to make layoffs, it sends shockwaves through the whole system,” says Freedberg. “Smaller companies then consider whether they should do the same.”
Candidates are also likely to have to temper their salary expectations.
“Those [companies] in a hyper growth phase have had to tone it down,” says Sorin Petrov, head of founder-hiring and talent at Merantix AG, an AI venture studio in Berlin. “In 2021, startups were planning between a 100 to 200 percent increase in headcount growth. They’ve had to reduce their hiring a lot, freeze entire new branches or expansions. Very few can afford to pay wages equivalent to Meta or Twitter.”
However, recruiters and experts say that the current malaise in the sector may be short-lived.
“Many of the current layoffs are affecting a group of young workers who came of age post-2008 financial crisis—they’ve never been through a wave of job cuts like these before,” says Charley Cooper, chief communications officer at enterprise technology provider and blockchain software company R3.
Once the shock wears off, and the market starts to recover, graduates are likely to want to be back at Big Tech.
“While 12,000 jobs sounds like a massive number, it really isn’t that many people for a company like Google,” says Cooper. “These are still great jobs: If you’re a technologist, it means you’re sitting in front of a computer creating something new every day. That type of talent will always be in demand.”
This article was originally published by WIRED UK
