Was it all a dream?
2022 began with a bullish job market in tech and IT as the economy heated up in the aftermath of loosened pandemic restrictions and more positions than workers to fill them.
That tight market for IT talent led to increased wages and aggressive headhunting from firms seemingly desperate for staff, even more so than in other sectors of the economy that also saw high growth and low unemployment.
“Virtually every company today is a tech company in some way,” Scott Dobroski, a careers expert with employment site Indeed, told IT Brew. “All of them want to uplevel their tech presence.”
Chopped. Over 90,000 tech workers were laid off by December 2022, according to a Crunchbase study. The cuts have come from big name companies—Meta, Netflix, and Amazon are among the most well-known—and smaller firms alike, as the industry prepares for what is expected to be an economic downturn in the coming months.
Yet the job market remains strong. There’s a reason for that: Tech has been so fully integrated into nearly every facet of American companies that IT workers are needed to keep the lights on, Dobroski said. And adversary threats have increased to the point that cybersecurity workers are needed either at the company or at outsourced firms that are managing a growing number of organizations that need assistance.
Dobroski noted that the nature of the pandemic’s effects on the economy may have somewhat inured the tech industry from the worst of the temporary economic downturn.
“There were over 260,000 jobs added in November, which was more than what economists and other experts expected; there’s an unchanged unemployment rate of 3.7%, which, again, overall, is still relatively healthy,” Dobroski told IT Brew. “In our data, we can tell when people are applying to jobs and getting hired. And our data shows us that unemployed workers are still finding jobs at elevated rates.”
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Dan Ives, an analyst with Wedbush Securities, told IT Brew that his firm has seen a “significant slowdown” in tech spending but that the cuts and layoffs are likely only a “short term dynamic.” In Ives’s view, because the current economic downturn seems to be a Fed-induced recession to cool inflation, it may not have the same staying power that the 2009 recession did. By the end of 2023, he predicted, most job losses will have been erased.
Sunny side up. While larger companies may be shedding jobs, the cuts are not coming for the most part for IT positions, rather they are “around tangential areas of the tech ecosystem.” So while the headline numbers may be bad, Ives said, “there’s still a massive supply shortage of software developers and engineering talent,” among other tech workers. Cybersecurity, machine learning, AI, and traditional IT roles continue to provide workers with a strong market.
“There are a wide variety of technology roles that you can get into now, it doesn’t have to be purely coding or purely doing the infrastructure stuff, you can be doing cybersecurity, you can be working on policy, you can be working with data and working with business units more closely and solving strategic problems,” CompTIA research analyst Seth Robinson told IT Brew.
“A lot of companies are looking for those people, they want to bring in the person that's got five, 10 more years of experience, and there’s not as many of those out there as there are companies trying to fill them,” Robinson said. “So it’s good news for people that have those skills. They can write their own ticket.”—EH
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