The tens of thousands of jobs cut recently at major tech companies may cloud long-term job trends. Tech work in general continues to grow and spread through the economy, although workplace tensions and conflicts in the tech sector may also be increasing.
First, the numbers. Bobby Allyn on NPR reports that the “tech industry is facing one of the worst contractions in history.” Google
The clumsy and often brutal way tech workers are fired dramatizes many stories. TO cabling report says Google workers found out they were fired when “the light on the card reader outside their office turned red, instead of green.” Twitter workers had their passwords “remotely changed” and company computers locked with a blank screen. Others, with little or no warning, were unable to log into their phones, computers, and accounts.
But the drama and big layoffs at some companies obscure the continued upward trend in tech jobs, both within the sector and increasingly across the economy. And the layoffs come after a time of very rapid job growth in tech.
Daniel Howley of Yahoo Finance compared Big Tech’s recent layoff announcements to its growth during the pandemic. Google has announced 12,000 layoffs, but has added 67,880 jobs during the pandemic. Microsoft has so far announced 10,000 layoffs, compared with pandemic job growth of 77,000. And Amazon’s 18,000 layoffs must be compared with its previous job growth of 746,000.
So while it’s upsetting that tech workers are being laid off (many for the first time) and in such petty and thoughtless ways, the layoffs are not a sign of impending economic disaster.
Many of these Big Tech companies have been on continuous growth paths for years and their stock prices sometimes seem to paralyze journalists and investors. Thus, the layoffs are generating an inordinate amount of media attention, despite the fact that the tech sector alone accounts for only about 3% of US jobs.
Tech workers have a relative advantage in the job market. They are better educated than most workers, with skills that are still in high demand. a 2022 ZipRecruiter Survey found that “among people who were recently laid off and previously worked in technology, 37% found a new job within a month and 79% found a new job within three months.”
And the jobs are still out there. Executive search specialist Atta Tarki writes for the Harvard Business Review (HBR) that it “remains a labor market for workers”, considering layoffs as “currently abnormally low compared to historical standards”. He sees “business America” in a “struggle” to hire suitable staff “in the coming months.”
Part of the advantage of tech workers lies in the expansion of tech jobs beyond companies in the tech sector. Other HBR article sees tech layoffs as “an incredible opportunity” for non-tech companies to hire qualified specialists. The authors agree that there was significant pandemic “overhiring” in tech, and the layoffs show that major companies are resizing their workforces.
They consider that technological specialties are increasingly necessary in all types of industries and functions: human resources, product and workflow management, electronic commerce and communications, cyber security, etc. more flexible” and can hire tech workers for their own business.
Laid-off tech workers will likely find new jobs quickly. Many of them have college degrees, and the overall unemployment rate for college graduates in December 2022 it was 1.9%. The skill sets and experience of tech workers mean that their unemployment rate is likely to be well below that – an educated, experienced tech worker still has an advantage over someone with a more general education and background.
But the tech layoffs highlight a larger structural concern: what happens to this growing, educated, and articulate workforce as it ages and gains more experience? Will they lower your expectations about work and careers? Will they get involved in “quiet quit?” Will they support public policies—and politicians—that offer them more support at work and at home? Could they even unionize? I will explore these topics in future blogs.
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