“They over hired Jake”.
“Standard case of last one in, first one out”.
These are just a couple of the phrases I have heard over the last few weeks whilst talking to candidates.
Unless you’ve been living under a rock, you’ll know that the likes of Google, Twitter, Meta and Microsoft have made considerable cuts to their workforce.
And they're not the only ones.
I have spoken with multiple candidates over the past few weeks who have had their tenure cut very short at series A-C funded businesses due to over hiring at the start of Q4.
It starts to make you wonder how so many companies have got it so wrong. Does it come down to investors getting itchy feet around the threat of the economic situation and now wanting return on investment? Or is it businesses thinking more staff means more sales?
There will continue to be endless speculation on why this is happening – every day I see new articles published and this one published by Ben Johnson is well worth a read if you have a spare few minutes.
However, despite the uncertainty of the sector and the number of people being made redundant, there is light at the end of the tunnel.
I would see it as a 're-calibration' or 'correction' of the industry which will give promising opportunities for talent.
Tech talent across the board will always be in demand and there still is a shortage of that. Now, more than ever, these businesses who over hired will be missing the talent they let go.
And with that, better run/funded businesses will be lapping up that talent.
Right now, I’m working with three businesses which are all at a huge stage of growth and have candidates in process with them who have come from this great over hiring correction.
They're the real winners in my eyes.
My advice for candidates in this market is ask the right questions. Such as....
- Have you had to make cuts anytime this year? If so, why?
- Are you driven by profit or growth?
- What does your funding runway look like?
- Would you have to have a restructure if you missed a funding target?
Just research, research, research.
And my advice to people hiring into their business?
Just be honest. Full transparency from the start means no hiccups through the interview process or a few months after onboarding. As if they do leave or you have to make cuts due to 'over hiring', that will reflect badly on your business and make future recruiting even harder.
Now, I know what you’re thinking. What do I know? You don't run a business Jake, you don't know what it’s like!
You’re right, I don't.
But I do talk all day long to candidates and keep my finger on the pulse of the tech talent market. And I also know that when your company’s hiring – or firing - process has left a sour taste with good talent in the market, it will come back to bite you.
Don't be the next Elon Musk...
The Four Horsemen of the Tech Recession – by @benthompson https://t.co/hbw0dA6Czg (via @jonerp) pic.twitter.com/X7xrDEJFKd— Jon Reed (@jonerpnewsfeed) February 13, 2023
The Four Horsemen of the Tech Recession https://t.co/2j85sLayvH— Jon Reed (@jonerp) February 13, 2023
-> one of the more important posts Ben Thompson has written. highly recommended longer read.
Tech is increasingly divorced from the real economy thanks to The Four Horsemen of the Tech Recession:— Bill Mew #Tech4Good #Privacy #Cybersecurity 🇺🇦 (@BillMew) February 12, 2023
3⃣End of 0% Interest Rates
4⃣@Apple's App Tracking Transparencyhttps://t.co/8WOR6FtrGw @stratechery @benthompson@dez_blanchfield @rwang0 pic.twitter.com/H0b9Qm5wV6
The tech disruption few people understand: Every company that relies on performance marketing, from YouTube to Meta to Shopify, has seen its revenue growth crash from the moment ATT (Apple’s App Tracking Transparency policy) came into force in 2021.https://t.co/2FHNIDYfXM— Gaurav Dalmia (@gdalmiathinks) February 12, 2023