Did 2023 Layoffs Create a Talent Explosion?: Navigating 2024 Tech Talent
The year 2023 has been the perfect storm for many industries, with the global economy in flux, inflation’s impact on rising costs impacting business operations, and greater demand for organizations to continue to invest in and adopt current technological advancements, particularly AI.
As a result, 2023 was marked by uncertainties and changes in the technology sector driven by significant events such as company layoffs (Amazon, Alphabet, Microsoft, Meta) and bankruptcies (WeWork, Silicon Valley Bank). According to Crunchbase, as of December 2023, more than 191,000 workers at U.S.-based tech companies have been laid off in 2023. Everyone knows someone who was let go or has LinkedIn connections with the infamous green “Open To Work” banner. But have these massive 2023 tech layoffs resulted in a tech talent explosion in 2024?
First, let’s set some things straight. Even though we hear about these massive layoffs at technology companies, not all “technology” jobs are being impacted. Tech layoffs have hit many different departments with a heavy focus on talent and recruiting, advertising and marketing, and sales, not just engineering, analytics, and software development. In addition, 79% of IT professionals started a new position within three months of being laid off. Despite these industry-wide layoffs, there are still more tech-related jobs that need to be filled in the US than there were layoffs in 2023. So, the answer is that there will be no tech talent explosion in 2024.
With the continuing shortage of tech talent, how can employers and tech talent best approach 2024?
Employers
Competition for talent still outweighs any setbacks of 2023, with HR leaders saying their tech hiring is due to both growth and the need to backfill open positions.
Things to Consider When Competing for Talent:
Compensation is the top priority for technology talent, with job security and benefits vying for number two. Ensure your compensation plan aligns with the market and highlight all associated company benefits.
Flexible remote work is the preference for most tech talent. As companies push for a return to the office, focus on maintaining work/life balance and flexibility.
Hire to upskill. Consider hiring junior candidates and upskilling them with the newest tools, allowing for competitive but lower overall costs.
Make investments in AI. AI has not replaced higher-level tech jobs but has made them easier and more productive. Adopting AI should be a top initiative for 2024.
Access a larger talent pool using supplementary resources within a broader workforce ecosystem. Rely on contributors beyond traditional employees, recognizing the changing boundaries of the workforce encompassing long- and short-term contractors, gig workers, partners, and technologies.
Tech Talent
Good news for you: tech jobs still outnumber tech talent. Even with many layoffs, tech employment remains a steady market; how do you make it work best for you in 2024?
In general, tech talent wants everything listed above, so ensure you run through this list and advocate for yourself and your teams if there are any gaps in your organization. If the gaps continue to exist or you want to pursue your passion and purpose, consider starting your own business.
More tech workers than ever started their own businesses after being laid off in 2023. The gig economy, characterized by short-term, project-based engagements, has reshaped the traditional employer-employee relationship. The gig economy offers workers flexibility and autonomy, allowing them to choose when, where, and how they work. This flexibility is particularly appealing in a fast-paced tech world, enabling individuals to balance work with personal commitments, their purpose, and diverse technical skill development.
Benefits of Businesses Engaging with Independent Tech Talent:
Cost Flexibility: businesses pay for specific projects, ensuring cost flexibility and efficiency.
Specialized Skills: contractors offer expertise for specific tasks, providing access to diverse talents.
Passion for their Craft: those who go out on their own typically have a deep knowledge base, next-level experience, and passion for their part of the tech stack.
Reduced Overhead: working off-site, contractors lessen the need for office space and equipment, minimizing overhead costs.
Short-Term Commitments: contractors allow businesses to bring in specialized help for short-term projects without a long-term commitment.
Flexibility in Work Arrangements: contractors often have flexible work arrangements for projects requiring unconventional hours or remote work.
In Summary
The tech talent shortage in 2024 continues to be a pressing concern for organizations worldwide, regardless of the massive layoffs experienced in the tech sector in 2023. As the demand for digital innovation escalates, businesses will continue to vie for skilled technical professionals, whether as direct hires or independent tech talent. Businesses can leverage contractors' flexibility and specialized skills, while individuals can find opportunities for diverse experiences and skill development.
