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- As companies grow, technology workers have had a new advantage in the last couple of years.
- As economic change shakes even companies like Meta and Google, that power may be fading.
- Tech workers may face lower compensation packages if they change jobs, pay cuts, or even layoffs.
Technology workers have already become some of the most in-demand workers during the pandemic. Now they are losing their ability.
Employers from Facebook, Google, Microsoft, Amazon and Twitter have struggled to hire enough workers to keep up with demand for online products over the past two years as the pandemic forces people out of their homes. Web3 products like cryptocurrencies and imperishable tokens were exploding. Even entry-level tech workers can set their own terms, including high pay, flexible work schedules, and the freedom to work from home or anywhere for that matter.
That ended abruptly. Over the past three months, tech companies from Google to Twitter have dramatically slowed or halted hiring altogether. According to Insider, dozens of layoffs have taken place, and up to 30,000 tech workers have lost their jobs this year at companies like TikTok and Oracle. Foreign Tracking Layoffs.FYI puts the industry’s tech layoffs at more than 60,000 this year.
For the average tech worker, that means the good times of multiple discounts, big giveaways of restricted stock units, generous raises and retention bonuses are over. According to a new report by technology industry consulting firm Foote Partners, more than half of the common skills in the industry have seen a decrease in compensation in the past three months.
Even Facebook, which is now going meta, is expected to start cutting employees based on new job prospects after aggressively hiring and offering generous pay packages throughout the pandemic.
“The pendulum has definitely swung the other way,” said Alap Shah, a managing director at Pearl Meyer, which advises technology companies on compensation strategy. In addition, last year, companies had a high demand for employees and even hired those with less experience or knowledge than the role required, believing that the employees would grow into their jobs.
“There are austerity measures going around right now, and companies are looking to focus on high-quality talent,” Shah said.
Pay cuts may be forthcoming.
In some cases, there may be no prospect of equity grants in technology workers’ employment agreements. And boardrooms are beginning to cool with the idea of big discounts and bonuses to keep even top talent. They should not expect salary packages of the same size as they have been for the last two years, said Shah.
“A lot of companies are taking a hard look at their pay structure and their equity structure and how they can realign it,” Shah said.
Meanwhile, employees who kept their jobs saw their stock options and restricted stock units decrease in total compensation due to the sudden decline in technology stocks.
Some speculate that pay cuts may be coming. Media entrepreneur and tech investor Jason Calacanis, known for his early bets on Uber and Robin Hood, recently said on the “Odd Lots” podcast that he expects “100%” of wage cuts to come, as companies’ slowdowns or slowdowns are clearly visible. Hiring offers, revocation and dismissal of employees. Meta said the FAANGs, known as Amazon, Apple, Netflix and Alphabet, and other seemingly untouchable tech companies could also be affected.
To avoid traditional downsizing, such companies are doing something that requires employees to end remote work and return to the office. Calacanis said when employees fight, the company can say, “Okay, so you don’t want to work here.”
“What they do is lay off a lot of people. Then they lower their wages and hire people again,” Calacanis said on the podcast. “This is a pay cut.”
Are you a tech worker or have an insight to share? Contact Kali Hays at khays@insider.com on the secure messaging app Signal at 949-280-0267, or via Twitter DM at @hayskali.
Contact Diamond Naga Siu at dsiu@insider.com or diamondnagasiu@protonmail.com, on Signal at 310-986-1383, or on Twitter @diamondnagasiu. Access using a disabled device.
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