The competition for tech talent remains fierce.
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Just when some were starting to think that the economy is running out of steam and that the tight job market would soon ease, the Bureau of Labor Statistics weighed in with its April jobs report, showing 253,000 net new hires and the unemployment rate falling to a 54-year low, 3.4%. In short, the war for talent continues and talent is winning.
Workers and those seeking work continue to have the upper hand in today’s U.S. economy, which still has far fewer people looking for work, 5.7 million, than the number of job openings, 9.6 million.
This remains true despite the rash of layoffs leading tech companies have announced recently, more bankruptcy filings by once-popular national retailers, and apparent troubles in the banking industry.
If you’re confused by all of the conflicting signals, it’s understandable. And you’re not alone. The economy does appear to be slowing down, but it’s also still growing. Many companies are reducing their workforces—in some cases giving pink slips to thousands of employees—but many others are still struggling to fill openings. Some employers may in the not-too-distant future find themselves in the driver’s seat again, but others still need to woo employees like they do customers.
Based on all the headlines about tech giants laying off large numbers of workers, one would think that the U.S. labor force is suddenly being flooded with computer coders, digital security experts and other assorted “techies.” In fact, says tech talent guru Ruth Ebeling, that “flood” is just a trickle.
Ebeling specializes in helping organizations needing tech talent— coders, designers, machine learning experts, artificial intelligence (AI) masterminds, and the like—find and build the expert teams they need. She suggests that we forget the “tech layoff” headlines and focus on what’s really going on in Silicon Valley and other technology centers as companies strategically reevaluate their needs after the technology boom buildup.
These are the facts that business leaders need to know, she says:
1) The vast majority of those being laid off by the big-name tech companies are non-tech workers; less than a quarter are actual techies. Most, she says, are recruiters, marketers, middle managers, and support staff. The U.S. labor market is not suddenly awash in tech talent.
2) The techies who have been laid off are quickly being gobbled up. Demand is still high and many are starting new jobs almost immediately. Some are realizing a financial windfall, in fact—with severance pay from their old employers overlapping with the pay checks they’re getting from their new employers.
3) Virtually all of the laid off techies (more than 90%, according to some estimates) are staying in the technology industry—with more than 40% of them heading to smaller companies and start-ups where there is more flexibility and greater expectation that the work will be challenging, innovative, interesting and purposeful. The others are going back to big tech.
If companies needing technology talent thought “tech layoffs” meant talent would be available at bargain basement prices they were wrong. The competition remains fierce.
So how do you get prospective candidates onboard—get them to say yes? Ebeling tells us her research shows the top three things tech workers are looking for in a job are financial compensation, job security, and work-life balance (not unlike workers in most other occupations)—with flexibility in work location and schedules also among the top ten.
This means employers need to keep their pedal to the metal on hybrid and flex work; it can be a critical factor in who gets the talent. For example, a large employer recently told me that they had similar tech jobs posted in two different divisions. One was posted as on-site, the other remote-first. Guess what? The remote-first opening received 19 times more applications than the on-site one.
The layoffs haven’t changed things very much. You still need to create a workplace where the talent you need wants to work. If you do so, you’ll do okay. If you don’t, you’ll struggle.
