How Recent Layoffs Are Affecting The Tech Industry

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In case you somehow missed it: tens of thousands of tech workers have lost their jobs in sweeping layoffs, nationwide. According to Engadget, these tech layoffs are most likely due to “the combination of a rough economy, the COVID-19 pandemic, and some obvious business missteps.” Though it’s not completely clear how recent layoffs are affecting the tech industry, experts have a few solid theories.

If you’re on the job hunt yourself, you can check out our CompuForce job board for open positions.

What’s causing tech layoffs?

TechCrunch suggests that a “macroeconomic environment and a need to find discipline on a tumultuous path to profitability” contributed to the 2023 tech layoffs. What’s more, over hiring during the pandemic has put companies in a tricky spot in the present.

But in an interview with Jeffrey Pfeffer, a professor at the Stanford Graduate School of Business, Pfeffer suggests that companies are implementing layoffs in response to one another in a sort of chain reaction. “These companies are all making money,” he highlights, implying that they don’t actually need to layoff employees at the current rates. “They are doing it because other companies are doing it.” He warns that the layoffs could spread to other industries, too.

How are tech workers responding?

Whereas tech was seen as a booming yet reliable industry just last year, the landscape has shifted. As a response, “tech workers are increasingly looking for jobs in industries beyond tech that may provide more stability in an uncertain economy,” Forbes shares. Luckily, tech skillsets span disciplines, upping a candidate’s chances of switching industries. (Looking to brush up on your IT skills? Read our blog post covering the hottest IT trends.)

What should tech workers look for in their next job?

Naturally, a laid off tech worker will be wary of a new organization. “My advice,” Pfeffer says, “when they find a job in a company where they say people are their most important asset, they actually check to be sure that the company behaves consistently with that espoused value when times are tough.” On the other hand, this provides an opportunity for tech employees to start their own businesses, assuming more control of their work environment.

How should companies react?

In order to attract top tech talent, companies should “prioritize flexibility, remote work opportunities and a culture that promotes growth opportunities, rewards and recognition,” notes the Harvard Business Review. Then, to retain talent, companies can offer support that emphasizes connection, community, professional development, recognition and appreciation. “This is important, HBS says, “whether your team is in-office or remote.”

How to help tech workers find careers

Undoubtedly, tech workers are in a tough spot due to sweeping layoffs, the effects of which are not only financial, but mental as well. The intricacies of said layoffs are reshaping the tech landscape as we know it.

But if you’re adding to your team, CompuForce is ready to partner with you and keep tech workers working.

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