{"id":50838,"date":"2023-11-07T13:48:23","date_gmt":"2023-11-07T21:48:23","guid":{"rendered":"https:\/\/www.springboard.com\/blog\/?p=50838"},"modified":"2023-12-12T11:01:45","modified_gmt":"2023-12-12T19:01:45","slug":"tech-layoffs-industry-jobs-after-layoffs-2023","status":"publish","type":"post","link":"https:\/\/www.springboard.com\/blog\/news\/tech-layoffs-industry-jobs-after-layoffs-2023\/","title":{"rendered":"How the Job Market Recovered After the Tech Layoffs\u2014An Inside Look at Tech Hiring, Generative AI, and More"},"content":{"rendered":"\n

After shedding nearly 250,000 workers<\/a>, the tech industry appears to be recovering from the mass tech layoffs in 2022 and 2023, albeit slowly. Job cuts peaked in January, with over 108,000<\/a> tech employees receiving pink slips. By contrast, less than 15,000 tech professionals were laid off in September. <\/p>\n\n\n\n

For now, at least, the smoke is clearing as Big Tech finishes course-correcting in the aftermath of the pandemic, when companies overhired from overestimating demand for online services like streaming, food delivery, and video conferencing tools.<\/p>\n\n\n\n

Post-pandemic hiring slowdowns and rising interest rates<\/a> designed to curb record inflation meant tech giants saw their valuations shrivel, creating pressure from investors to abort non-business-critical endeavors like R&D projects and drop headcount. For example, Meta reduced support<\/a> for NFTs on Instagram and Facebook, while Amazon shuttered<\/a> its primary care service, Amazon Care, due to a lack of customers. <\/p>\n\n\n\n

Revenue per employee, one of the basic measures of company efficiency and productivity, fell <\/a>at Amazon, Meta, and Twitter from 2018-2022 by 6.9%, 14%, and 18.2%, respectively. <\/p>\n\n\n\n

\"Revenue
Source: INSIDER<\/a><\/figcaption><\/figure>\n\n\n\n

\u201cThis is happening even as people claim that generative AI tools are causing huge productivity gains,\u201d says Nathan Brunner, founder, and CEO of Salarship<\/a>. \u201cWhat\u2019s causing it is an overall loss in revenue.\u201d<\/p>\n\n\n\n

As a tumultuous year in tech comes to a close, we wanted to give current and prospective Springboarders insight into where the tech job market is headed next, especially given recent developments in generative AI. <\/p>\n\n\n\n

Tech Layoffs: A Brief History<\/h2>\n\n\n\n

Big Tech took a major beating throughout the year. Meta laid off 11,000 employees<\/a> in November 2022, and another 10,000 <\/a>in March, effectively shedding a quarter of its workforce<\/a>. Dropbox discharged 16%<\/a> of its staff, and Microsoft shrunk its workforce by 10,000<\/a> workers. Amazon offloaded 27,000 workers<\/a> in the past year. <\/p>\n\n\n\n

Nevertheless, the lion\u2019s share of job cuts affected recruiters, marketers, middle managers, and support staff more than actual techies (i.e., programmers, data scientists, UX designers, etc.). Of all tech-industry workers affected by layoffs, only 22%<\/a> were software engineers. Most job cuts (28%) hit professionals working in HR and talent sourcing. Marketing employees followed (7.1%), then customer service (4.6%), PR, communications, and strategy (4.4%). At Microsoft and Meta, UX design represented 3.5% and 4.3% of job cuts, respectively.<\/p>\n\n\n\n

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Unfortunately, mass layoffs have been normal<\/a> for a very long time. Excessive inflation in 2022 (9.1%<\/a> compared to a typical annual rate of 2%) softened consumer spending, forcing businesses to make cutbacks. Employee payroll represents the biggest expense for most businesses; hence, employees tend to become immediate casualties at the first sign of a downturn. <\/p>\n\n\n\n

\u201cThe idea that you would have job security is sort of a 20th-century invention,\u201d Louis Hyman, a historian at Cornell University, told Vox<\/a> in an interview. <\/p>\n\n\n\n

One 2019 study by HR tech platform CareerArc found that 40%<\/a> of respondents said they had been laid off at least once. <\/p>\n\n\n\n

\u201cThere is no such thing as job security unless you have your own company, and even then, the company can get so big that the board votes you out\u2014like what happened to Steve Jobs,\u201d says Maria Tomaino, a career coach at Springboard. \u201cA smart choice is for Springboard students to have their own LLC for contract work. Always aim to diversify your income with projects, freelancing, and other opportunities.\u201d<\/p>\n\n\n\n

Growth In Tech Occupations Remains Strong, Despite Layoffs<\/h2>\n\n\n\n

While layoffs at FAANG companies (Facebook; Apple; Amazon; Netflix; and Google) courted the most publicity, given their sheer market dominance, the tech job market remains strong. However, the most in-demand positions may have migrated outside Silicon Valley. In a recent BCG survey, 40% of laid-off tech workers had found new startup jobs. Many former Big Tech staffers find greater satisfaction in less corporate roles with reduced red tape and the ability to work remotely. Small companies are twice as likely to hire full-time remote workers, according to a State of Remote Work report<\/a> by Owl Labs, to save money on office space. <\/p>\n\n\n\n

Former techies are being scooped up by firms in other sectors, keeping the job market strong. CompTIA predicted<\/a> net tech employment would reach 9.4 million in 2023, representing a 3.4% increase from the prior year. Over the next 10 years, the number of job postings will continue to outweigh layoffs. The replacement rate for tech occupations during 2023-2033 is expected to average 7% annually. <\/p>\n\n\n\n

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According to CompTIA\u2019s State of the Tech Workforce Report<\/a>, these are the top projected growth occupations for the next 10 years:<\/p>\n\n\n\n