It might seem like the war for tech talent is over. After 12 months of brutal layoffs and hiring freezes from big names like Amazon, Facebook, and Microsoft, U.S.-based tech companies have laid off a collective 150,000 professionals over the past few months—a considerable reduction of the companies’ workforces. But don’t let these numbers fool you: In key ways, the market for talent has seldom been more competitive, and it’s only going to get worse from here.
We’ve heard this interpreted again and again as an obvious signal pointing to an upcoming recession. Look a little deeper, though, and you’ll see the beginning of something else: the next phase in the tech talent wars.
The New York Times’s Silicon Valley reporter Erin Griffith quoted tech moguls from Elon Musk to Mark Zuckerberg as saying that past over-hiring is the main reason for the current cost-cutting. Big companies flush with cash had stockpiled talent, sometimes just to keep workers away from competitors.
That’s over. What we’re likely to see, now that the tech hiring bubble has burst, is a return to more conservative hiring practices, which means that talented professionals are about to encounter a market that is more competitive, from the job-seeker’s perspective. Although painful, the long-term result could be a win for both parties and help define great talent.
Even before the setbacks of 2022, companies already faced widespread challenges in finding the right talent. Key sectors like cybersecurity experienced a shortfall of available talent with relevant and up-to-date expertise. What we’re seeing now is a reshuffling of the talent deck, as employers try to hold on to their most strategic cards. But more layoffs inevitably mean more work. And while AI and automation may replace certain workers in areas like HR or administration, finding and retaining talent with key experience, like software engineering, is going to be a top priority for business leaders in 2023.
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