🌏 #8 | Is the tech jobs boom over?

The mood in tech labour market has changed rapidly over the last few years. The job market optimism stemming from the accelerated expansion of the tech industry during the Covid years has waned. Underlying this has been rapid rate rises and a post-Covid return to the physical world.

The realities of the tech labour market have been felt most acutely by job seekers.

🔚 The layoffs story

The layoffs story has been well reported in newspapers. In 2023, according to layoffs.fyi, a global database which pulls together layoff numbers from industry coverage, tech layoffs impacted some 263K workers, up close to 60% from 2022.

🔍 The hiring story

As for the hiring story, if a company has just laid off workers, then it’s expected that there would be a freeze on hiring to critical roles in the short-to-medium term. Such hiring freezes may begin prior to layoffs and are sometimes announced by the biggest companies.

But as for when hiring freezes begin to thaw or to get a pulse check on hiring, this can be harder to know. Job seekers often find themselves turning to word of mouth and the anonymous water coolers of the Internet such as Reddit and Blind. Anecdotally, the vibe isn’t great.

📊 What hiring data tells us

Jobs data can help us confirm the vibe of the current job market.

🌏 According to jobs data from trueup.io, which tracks job openings at top tech and tech-ish companies globally, total job openings peaked at 478K in April, 2022 and are now down some 59% to 196K this month.

🇦🇺 Turning to Australia and software engineers in particular, according to online job ads data, monthly new software engineer job openings peaked at 8.8K in March, 2022. By December, 2023, this number had decreased by 54% to 4K. In comparison, four years earlier pre-Covid, there was 5.3K job openings in December, 2019.

These datapoints support the prevailing narrative of the last few years: A tech jobs boom during Covid as central banks cut interest rates to support the economy and technology adoption was slated to accelerate followed by a lurching reversal of these trends post-pandemic through to today.

🌱 Reasons for optimism

Some have lamented that the best days of working in tech are behind us as an era of historically low interest rates end and given the growing automation capabilities of generative AI.

But from the dot-com bust to the threat of offshoring, the demise of the tech worker has long been forecast — and those forecasts haven’t materialised.

The story of the tech industry from its modern-day origins in 1950s California has been a series of booms and busts, where new technologies ultimately expand the sector and grow the demand for skilled workers. There aren’t compelling reasons to expect this time will be drastically different.

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