Tech workers have long gotten what they wanted. It’s over.

Tech workers used to asking for the moon are starting to hear an unfamiliar word as startups and giants such as Google and Microsoft MSFT 0.54%

be more careful: No.

For much of the pandemic, tech companies big and small conducted hires where potential employees could name their price and expect rich perks from working from anywhere. Now, as fears of a recession loom, more employers are cutting or freezing hiring, rethinking how many of their positions should be away and, in some cases, even rescinding job offers.

Microsoft Corp. announced this week that it would be laying off a small percentage of its staff, following earlier layoffs at Netflix,

Coinbase Global Inc.

PIECE OF MONEY 0.60%

and Twitter Inc. Alphabet Inc.-owned Google CEO Sundar Pichai also told employees this week that the company would slow the pace of hiring for the rest of the year. And the head of engineering at Meta Platforms Inc., Facebook’s parent company, told his managers to identify and report underperforming employees to manage them.

Technology worker Lindsey Collins Guest, 40, said she had experienced these changing expectations firsthand. In May, she was laid off from Bolt Financial Inc., a payments-focused fintech company, and during her search, potential employers offered base salaries that were an average of 30% lower than she was. won. She eventually took a job at a live shopping startup that met her minimum salary requirements.

“It was obvious to me that the good old days were kind of over,” says Ms. Guest.

Lindsey Collins Guest said potential employers were offering base salaries that were an average of 30% lower than what she earned in her last job.

Photo:
Guest Lindsey Collins

One of the reasons for this change in bargaining power in startups: capital does not circulate as freely. As venture capitalists tighten conditions and investors offer survival advice to portfolio companies bracing for a downturn, startups are more focused on cutting costs than growing fast. That means spending exorbitant sums on salaries to attract new recruits is coming to an end, say those who help recruit for venture capitalists’ portfolio companies.

Not all employees are disadvantaged. After all, there are still more open positions in the industry than there are people to fill them. Job postings for tech roles reached 505,663 in June, a 62% increase from the same period a year ago, indicating that employers cutting back on hiring are more than compensated by those who continue to swell their ranks, according to CompTIA, an IT trade group. Microsoft, for example, will further increase its workforce in the coming year despite layoffs.

Highly skilled workers in fields such as machine learning and artificial intelligence can still name their price, recruiters say. According to CompTIA, almost a third of all tech job postings in June were for software developers and engineers. The number of software development job postings mentioning remote work had also increased to nearly 38% at the end of June, from around 32% in the same period a year ago, according to Indeed.com.

share your thoughts

What is the hiring status for tech jobs at your company? Join the conversation below.

The current gap between salary expectations and reality is, in part, due to the high level of compensation achieved in 2021, says Saydeah Howard, director of talent for IVP, the venture capital firm that invested in Dropbox.,

GitHub Inc. and Snap Inc.

The 2021 increase “was outrageous” and “unprecedented before”, says Ms Howard.

Candidates looking to enter an office may have an advantage over those seeking remote arrangements, venture capitalists and recruiters say. Ms Howard said executives now tell her they prefer to hire candidates who are enthusiastic about being in the office. “Now not everyone will say it out loud,” she said.

Some venture capitalists have been less timid in showing their preference for companies that call workers back: Keith Rabois, a partner at Founders Fund, tweeted in May how he was looking to fund “IRL” or “real life” startups. Josh Wolfe with Lux Capital last month tweeted his support of Elon Musk’s office tenure for Tesla employees.

“Remote work works in isolated cases,” Mr. Wolfe wrote, adding that “in difficult times + the coming recession, people will need fast face-to-face body language communication, camaraderie and of a signal engagement”.

Tech workers have long gotten what they wanted Its over

Photographic illustrations:


Josh Wolfe/Lux Capital

Bill Gurley, partner at Benchmark Capital and primary funder of Uber Technologies Inc. and Grubhub Inc., tweeted that the era of ultra low interest rates created a competition for workers that led to a set of “Disney-like” experiences and expectations.

“For employees who have only known this world, the idea of ​​layoffs or cost cutting (or being asked into the office) is pure heresy,” he tweeted. “It’s not their fault. Excess capital has led to an excessive shower of benefits and heightened expectations.

A recruiting manager, Curtis Britt with Korn Ferry,

said around 50 per cent of the open jobs Mr Britt tried to fill this time last year were entirely remote, and today that number is closer to 25 per cent. Earlier in the pandemic, Mr Britt said he helped fill 30 software engineering positions for a financial services firm which was then open to remote arrangements; now that same company is more demanding about where workers can live, who it is willing to hire and how much it will pay, according to Mr. Britt.

“Their taste has become much more refined,” says Mr. Britt, who is Vice President of Projects at Korn Ferry.

As markets react to inflation and high interest rates, tech stocks are off to their worst start to the year on record. Hardika Singh du – explains why the sector – from tech giants to small startups – is being hit so hard. Illustration: Jacob Reynolds

Erik Duhaime, who runs Centaur Labs, a medical artificial intelligence startup in Boston, made similar adjustments during a recent search for a role in product marketing. First Centaur Labs lowered the upper limit of the salary and experience levels it would consider. Then he gave up the search altogether.

“For one candidate, we said, ‘Hey, actually, we’re sorry, but we don’t want to make an offer because we’re re-evaluating our priorities and we don’t want to be the company making an offer and the ‘Cancel,’ he said.

Centaur Labs is still hiring for critical positions, including a security engineer, Duhaime said. But “we don’t have the same sense of urgency. We want to make sure we find the right person. he says. “We want to make sure that we are very picky. »

Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Leave a Comment