The tech boom has receded to little more than an echo of late. Falling stock prices, an abrupt downturn in digital advertising and fears of a recession have sparked waves of job cuts across the sector. Meta has laid off more than 11,000 employees, or 13 per cent of its workforce, in the latest example of the painful retrenchment.
Yet chief technology officers of businesses outside the Silicon Valley bubble are still struggling to hire enough tech workers. Staff shed by tech giants should be quickly absorbed elsewhere. The Great Rotation should be followed by a Great Redistribution of talent.
Tech groups have announced 106,000 job cuts so far in 2022, according to Layoffs.fyi, a crowdsourced site that tracks redundancies in the tech industry. Lyft, Stripe, Snap and Twitter are among companies that are culling staff. Even those that have been relatively resilient — such as Apple and Alphabet — have paused or slowed hiring.
From banks to bricks-and-mortar retailers, every other industry is investing in its digital transformation. At JPMorgan, boss Jamie Dimon has no plans to cut back on the firm’s $14bn IT spending budget this year, despite recently warning that the US is likely to go into a recession.
Overall, the number of people employed in the tech industry has increased by 194,000 so far this year, according to an analysis of US jobs data by IT trade group CompTIA. Job postings for tech workers stood at nearly 317,000 in October, an increase of more than 10,000 from September.
Some sectors are hiring heavily. Companies with the most tech job postings include defence contractors Boeing and Lockheed Martin and healthcare giants UnitedHealth and Humana.
The relative share price resilience of big Indian IT outsourcing companies like Infosys offers another proxy of demand for tech workers outside the FAANG grouping. Infosys’s revenues were up by nearly a quarter in the three months to September while pre-tax profit rose 12 per cent.
The payroll pain of Big Tech helps mature businesses doing nicely from rising rates and the Great Rotation. They include stuffy old banks and insurers. Better dust off those interview suits, tech bros.
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