It is still very hot, despite some layoffs

A “We hire!” the sign is shown in Starbucks

Mario Tama | Getty Images News Getty Images

Last week, senior Coinbase product manager David Hong wrote on LinkedIn that he got up at 4 a.m. to prepare for a meeting when his MacBook company suddenly stopped. He later learned that he is part of almost 20% of the company, which is being fired due to what the CEO of the company called the impending recession.

“When I joined Coinbase, I agreed that working in this industry would be risky,” Hong wrote in a LinkedIn message. “But, on the other hand, I never gave the company any more, and only last week I was assured that I / my team was safe.”

When Coinbase announced the layoffs, it sent a wave of concern beyond the crypto industry into the wider world of technology.

But recruiters wasted no time commenting on the post of Hong and the like, with hiring opportunities in their companies.

While Coinbase has been one of several companies to announce layoffs in recent weeks, recruiters and others involved in hiring technology are telling CNBC that they are more non-standard than the rule. Even after months of falling stock prices and inflation in the U.S. economy as a whole, companies across the industry are still desperately looking for talent.

Layoffs, slowdowns are isolated

Microsoft, parent company Facebook Meta, Nvidia and Snap have in recent weeks announced plans to hire less actively as inflation, the war in Ukraine and the long-term effects of Covid-19 around the world have worsened prospects for the rest of the year. Venture capitalists are warning their portfolio companies to prepare for darker times, and some startups are laying off people or closing stores.

But experts say the cuts are still isolated.

“Layoffs seem to be typical of businesses that are in a more volatile financial situation, such as when they are unprofitable and funding has dried up, or when they simply don’t have a runway to continue to operate without additional funding,” Daniel Zhao said. a senior economist at Glassdoor, a job-seeking site used to evaluate potential employers.

Zhao added that several companies are “reading the economic brew and retreating into uncertainty,” as opposed to necessity.

As a result of high-profile Netflix layoffs, the company took action after reporting it the first loss of subscribers in ten years. Most of the roles affected were not technology-related and are based in Los Angeles. Most are managers or “coordinators,” according to California documents reviewed by CNBC. The company also continues to regularly publish vacancies each week.

But for most industry representatives, this is normal, experts say. They are still hiring and they still have a shortage.

“You can’t say there are extensive technology layoffs because it’s so isolated,” said Megan Slabinski, county, president of HR consultants Robert Half. “I don’t see that the demand for technology-related positions won’t affect the foreseeable future.”

“Cryptocurrency companies that seem to be run by middle school students who think they’re going to take over the world are the ones that are slowing down,” said Valerie Frederickson, founder of search firm Frederickson Partners, an insurance and risk division. Gallagher management company. “When venture companies send out letters that say, ‘Hey, boys and girls, it’s time to slow down the purchase of table football, it’s time to get serious’ – this is what happens to such a group.”

Experts also pointed to examples such as a Reuters report earlier this month, which said Elon Musk wanted to cut 10% of jobs at Tesla, citing a “super bad feeling” about the economy. Musk later said this, saying the announcement of Tesla’s layoffs would affect only about 3.5% of the total workforce, saying the actual amount was “not supermaterial.”

“You can lose a lot of confidence in the market if you make harsh reactions that can hurt your brand employer,” said Lauren Ilowski, a talent partner for Alphabet’s growing venture capital division, CapitalG.

Employees are still in the driving position

Slabinski says every tenth call she receives is related to economic problems, but most employers are hoping to find out if there will be more talent. Candidates receive several proposals at once, experts say.

“When the headline comes up, I get a call from the company and they say, ‘I see it’s layoffs, now is the time when I can get better access to talent or ask for more qualifications than a few months ago?’ Said Slabinsk. “And my answer is no.”

Slabinski says a recent company report shows that 52% of technicians are still looking to quit or look for new opportunities over the next six months.

“We are seeing a modest decline in demand for technicians, but the level is still much higher than it was before the pandemic, and companies are still in despair,” Zhao said.

The human resources departments of companies dealing with the technology ecosystem are also in high demand. “A lot of technology employers come to us and ask for four to six different staff searches at the same time because they have such a great need,” Frederickson said.

“Workers still have the leverage to demand better organization, but instead of office benefits such as a free lunch and ping pong table, technicians are looking for remote work and flexibility,” Zhao said.

“Now I’m talking a lot about compromises to go to public companies or a private company,” said Ilovsky of Capital G. “The most common topic is whether I should go to Facebook, Meta, Apple, Netflix, etc.” and take advantage of the lower stock price, knowing that it will hopefully rise again? Or if their capital is under water in a large technology company, they say, should they go to a private company? ”

They also use their levers to keep employers ’feet on fire, experts say.

“Candidates are asking very difficult questions, which the founders have not had to answer for the last few years,” Ilovsky said. “Things like ‘Are you planning to hold a round of downsizing?’ ‘Or on the way to carrying out our board’s plan?’ or “Are you ready to work with the headwind of the market?”


Some companies, however, pause or overestimate what they need.

Ilowski said she advises all concerned employees to “fight back” before taking steps. Companies, she said, are doing the same, though not on a large scale.

‘When it all started to go away, it wasn’t’ damn —! ‘ Because they are still on an upward trajectory, – said Ilovsky. – It was rather an overestimation of how the market could enjoy growth, which has deteriorated, for example, “maybe we are investing more in engineering than in marketing.” Or, the company says that “instead of investing all our energy in the product in 2026, we will focus on our core product”.

Generally speaking, they are afraid to take any serious steps, fearing that they will not be able to hire employees when they need them. “They think it’s going to be like Covid when some companies slow down hiring and then have to play catch-up, and that puts them behind the ball,” Frederickson said.

“Their memory is of recent history – they don’t want to return to the 2021 job market,” Zhao said of the company. “They played catch-up after Covid and kept up with the absolutely insane environment that ensued and the struggle to get back to work quickly,” Ilowski said.

Some experts said the additional pause was ultimately good for the industry, which has grown in recent years.

“I’d like to see a little slow to make it easier for my CEOs and boards to hire good HR executives without a lot of offers, but unfortunately I haven’t seen that at all,” Frederickson said.

It is still very hot, despite some layoffs

Source link It is still very hot, despite some layoffs

Back to top button