Tech layoffs have been dominating the headlines, but they are not only misleading but potentially harmful to those making decisions about the future of their career.
The U.S. economy added 223,000 jobs in the last month of the year alone. Yes, Microsoft is laying off 10,000 employees this month, but did you know that they’ve added almost 80,000 jobs to their workforce since 2019?
So, what’s really happening in tech, and how should you think about career prospects in the sector going into 2023.
Jobs that are being prioritized by employers
Job opportunities in the next 6-12 months will favor those that can help drive up the bottom line in a business. That means you’re in luck if you have direct sales or client facing experience, or the ability to drive brand awareness for a business that can result in more revenue.
While tech companies might continue to cut expensive engineering and operational roles, they’re shifting their budget to business related roles that focus on maintaining healthy cash flows for the company.
If you don’t have those skills, consider taking some free self-paced classes on platforms like Coursera to learn the basics, and live mentor-led guided courses at places like School16 that can help you rapidly develop tech business skills, while working on projects that you can show-case to employers.
Tech industries that are still growing
Yes, some tech-giants have recently had to cut their workforce after experiencing years of unprecedented growth and overhiring, but most people looking to break into the industry are actually not competing against this type of senior talent.
Furthermore, there are specialized industries within tech like healthcare (healthtech) and education (edtech) that are still continuing to grow.
Developing skills for the sector is still the best investment you can make in yourself, but if you’re new to tech remember that you should focus on specialized industries that others are ignoring to secure a role in a healthy business that can help you grow your skills during this economic downturn, to set yourself up for a major salary increase at a different company once the economy picks back up in the next 1-2 years.
How to identify companies that are still healthy
To find companies that are still doing well during an economic downturn it’s good to look at how investor behavior is changing.
Billions of dollars have poured into tech over the last decade, contributing to fast hiring and fast growth, but during an economic downturn investors are more likely to give money to a company that already has their revenue and expenses under control. In other words, they take less risks.
Today, investors are looking for resourceful early stage startups that are already generating revenue, instead of bigger companies with many expenses that might quickly burn through their capital.
When searching for companies to work for, avoid low cash flow businesses that raised money several years ago. There’s a good chance that they’re running out of capital, and might need to lay off employees soon.
Instead, find organizations that have a clear value proposition that you believe in, that are growing their customer base because of how valuable their product or service is to the end consumer.
You can also use resources like angel.co or crunchbase.com to see which companies recently raised a round of financing. These businesses raise money to be able to quickly hire employees, so if your skills match their needs there’s a good chance they’ll want to talk to you.
While tech layoffs will likely continue into 2023, many companies in the tech sector will continue to hire. It’s easy to get discouraged by the news cycle, but remember that attention grabbing headlines are designed to drive clicks, and aren’t necessarily a reflection of what’s actually happening in the market.
Stay focused on improving yourself and narrow your efforts toward opportunities with growing companies. When the overall economy picks back up, you’ll be well ahead of others that stayed still because they were misinformed.