In the full 12 months of 2022, a great year overall for the job market, 1,054 companies in the tech sector registered 164,411 layoffs (Source: layoffs.com, which monitors tech companies).
By mid-April of this year, that number already was blown out of the water, with 586 tech companies reporting 170,549 layoffs (as of April 15). So not only have we seen an explosion in tech sector layoffs, the average number of layoffs per company went from 156 to 2,951—and that’s not yet including Meta CEO Mark Zuckerberg’s announcement of two upcoming rounds of layoffs to the tune of 21,000 workers—plus a withdrawal of 5,000 open jobs (Source: New York Times, April 12). Total damages, Meta alone: 26,000. And we’ve also seen what Elon Musk is capable of. There’s more to come, for sure.
In my first column of this year, “11 Things I’ll Be Watching Closely This Year,” No. 3 was tech layoffs. I simply said, “Watch out. The big boys are cranking up.”
That didn’t take long, did it?
As if this weren’t dramatic enough, in the first three months of 2023, the overall economy created 1.216 million jobs, sustaining its 27-month run of 12.5 million jobs in the most stupendous post-recession comeback in history. Not only has that never been done before, it’s never even been dreamed of before. But the tech sector is down—and not by a little bit. Why?
In a Zoom interview with me in February, Cherena Walker, executive director of the career center at Stevens Institute of Technology in Hoboken, explained, “During COVID-19, tech had a hiring boom with significant demand, and crypto was a part of it. It appears there was overhiring, and now there’s an adjusting to the new demand.”
I’ll say! That could be the understatement of the year. And, from my vantage point, we’re nowhere near done. So, with these dismal prospects, that brings up the most basic of questions: Why did you go into tech? Why did you major in or get certified in information technology or computer science to begin with?
What I’ve found in my independent career coaching practice is that the two most prevalent answers are: 1) It’s well paid, and 2) It’s cool. If you’ll forgive me, now you can add formerly well paid and not as cool as you thought. There are many reasons to go into a field, including IT, but those two shouldn’t top your list. First ask the question: What matters to me?
Six months ago, I started a program called “Coach on Call” whereby clients have access to my coaching whenever they need it, employed or not. (https://eliamdur.com/coach-on-call/) It’s been very effective on many fronts, but one more than the rest. When we get into the career planning aspect—namely, the “What do you really want to do with your life?” question—every single client currently in IT came to a realization that what mattered to them was something in addition to IT, for example, health care or public service or management consulting or urban planning. In short, they realized they were interested in things that were more customer-facing (not necessarily back office) but that their formidable IT skills could help get them there. In other words and in simple terms, doing IT in a field that’s not primarily IT. Existential. And we got to that point through open exploration, going back to the question “Why, exactly, did you go into computer science?” That’s quite a moment and is not limited to this one field; in fact, it stretches to us all. But it is particularly apt in light of the tidal wave of tech sector layoffs that is not going to end soon.
Being in tech just for the sake of being in tech can be highly lucrative, for sure, but the data show the risk. Tech’s loss of 170,000 jobs represents 14% of the jobs created in the same period of time. Stop and think about that for a minute. For every seven jobs created elsewhere, one tech job went up in smoke. Or, shall we say, deleted. Otherwise stated, nearly 1.4 million jobs have been created this year; it’s just that 170,000 of them were canceled out as if, on a macro basis, they didn’t happen at all.
Will there be an end to this? Of course, but not soon, so I’d advise one and all to eschew career choices based solely on income.
Excess obfuscates purpose.
Eli Amdur has been providing individualized career and executive coaching, as well as corporate leadership advice since 1997. For 15 years he taught graduate leadership courses at FDU. He has been a regular writer for this and other publications since 2003. You can reach him at [email protected] or 201-357-5844.