It’s an anxious time for the tens of thousands of newly laid-off workers now hitting the US job market amid inflation pressures and recession concerns. — Image by yanalya on Freepik
Every day, headlines blare stories of turmoil in the tech world as companies including Meta, Twitter, Stripe, Lyft and Salesforce slash their workforces.
It’s an anxious time for the tens of thousands of newly laid-off workers now hitting the US job market amid inflation pressures and recession concerns. As they seek new jobs, they contend with fewer openings, hiring freezes and competition from all the other suddenly unemployed people.
The change in atmosphere is palpable.
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Pleasanton resident Nilesh Bhandare, 39, was a data engineer at Twitter. He was shocked that his position was eliminated in new owner Elon Musk’s purge last week of half the staff, since Bhandare’s work was integral to the company’s business.
He’s seen a dramatic turnaround in what’s available in the job market. While lots of recruiters have approached him, only about 20% are focused on full-time positions. The rest are seeking contract workers – who can more easily be let go. The last time he job-hunted, the situation was reversed, with a preponderance of full-time positions.
“My take is, no one wants to commit now for full time, because companies are not sure about the economic situation,” Bhandare said.
Online job listings starkly depict the downturn. In January, there were 41,718 tech job listings in the San Francisco-Oakland-Fremont metro area, according to data that job-hunting site ZipRecruiter culled from thousands of websites. By Nov 1, that had plunged to 27,919 – down a third. The San Jose-Sunnyvale-Santa Clara metro likewise fell by a third, going from 28,421 tech job openings on Jan 1 to 18,748 on Nov 1.
“We have seen labour market conditions deteriorate very substantially in a slice of the labor market,” said Julia Pollak, ZipRecruiter chief economist. “The pain is concentrated in a narrow set of industries: tech, real estate and finance, mostly.”
Not surprisingly, ZipRecruiter’s surveys of job seekers showed their confidence falling. At the same time, more people than ever are seeking positions with more intensity. For instance, there’s an increase in those who search daily rather than logging in once in a blue moon, Pollak said.
Jake Schneider, 29, also experienced a before-and-after snapshot of the hiring market.
He was laid off in late October from a job as a technical recruiter at Santa Monica’s Recharge, which makes payment software for subscription services.
Earlier this year, while still employed, he’d sent out a flurry of resumes and had an 80% response rate of companies asking to schedule interviews. Now, even though he’s applying to about 10 openings a day, only about 20% want to set up a time to chat, he said.
Of course, recruiting jobs are often the first casualties during downturns.
“We’re the canary in the coal mine,” Schneider said. “Our main job is to fill roles and if there aren’t roles to fill, we aren’t needed.”
For other types of tech roles, many job hunters say there are still opportunities, but it remains to be seen whether they will come through.
Wren Turkal of San Jose was a staff site reliability engineer at Twitter, and is at a senior point in her career.
In the few days since being laid off, she’s found that there are still interesting positions but the job market definitely feels softer.
“We’ll see what happens: Are companies really hiring or will they pull the plug?” she said. “No one really knows until they have an offer.”
She’s heard from “a ton” of recruiters, both agency headhunters and corporate recruiters, “which tells me there is definitely some interest out there”.
But she found Twitter’s severance package woefully inadequate, and as the primary breadwinner, “I have to take care of my family,” she said. Her partner, Rachel Turkal, just started a small bakery business, Browned Butter Babe.
Their son, Aerik, 13, is in gymnastics, and she doesn’t want to compromise his ability to continue with it, as well as to stay in his Mandarin immersion programme in the Cupertino school district.
All the layoffs – and increased competition – “give me pause, for sure,” she said. “There’s always a supply/demand problem; if there’s more supply, it makes it worse. I’m definitely worried about that.”
Overall, she feels that she can’t get a bead on the economy.
“A lot of stuff is playing that makes it really hard to read how bad it will be,” she said. “There’s a lot of uncertainty.”
Despite tech’s downturn, Pollak and other experts said it’s merely correcting from a big run-up in recent years.
“Many of these technology-related companies have grown faster than almost anywhere else because the pandemic accelerated the digitisation of everything and unleashed extremely favourable conditions” for interest rates and financing, Pollak said.
Although the layoffs appear huge, they simply roll back the clock a few months for many companies that expanded rapidly. Meta, for instance, recently has averaged 15,000 a year additional employees, so the 11,000 jobs cut last week just take it back to its head count at the beginning of the year, Pollak said.
Boulder Creek resident Marc Weil, 35, was an engineering manager at San Francisco’s Stripe, a digital payments giant. This is his first time being laid off, “a rite of passage, I suppose,” he said. He was surprised that major companies such as Netflix (which had layoffs in May and June) posted only three open positions for engineering managers. “That was weird; you’d expect that they always need to hire new people because of attrition.”
Still he’s heard from early and mid-stage companies, as well as their VC firms, that they are still hiring.
“Tech has always been a cycle that goes up and down,” Weil said. “But the roller coaster is really stressful.”
Some people who were in earlier rounds of layoffs have already landed jobs, but even they are pessimistic about the market.
San Francisco resident Tyler Deng, 29, was on the product operations team at Tempo, a smart home/fitness company that grew rapidly during the pandemic and laid off employees in early October.
“Right now is not the best time to look for a job; going into Q4, no one knows what’s for certain,” he said. “Is it better to apply right now or should I just wait until January?”
The unsettling climate could last even once someone lands a job. “I’ve heard horror stories of companies that had to rescind offers, or got hit by layoffs a month after hiring.”
But in the end, he found a new job that starts this week, comparable to his role at Tempo.
Still, he worries about the economy.
“It’s a vicious cycle,” he said. “If people get laid off, they cut their spending. That leads to other companies suffering more, and becomes a domino effect.” – San Francisco Chronicle/Tribune News Service
