Laid-Off IT Staff Shun Run-of-Mill Work --- Recruiters at firms not specializing in tech are at disadvantage over work culture, pay.

 

"Companies outside of the tech sector are facing an uphill battle in trying to recruit Big Tech's laid-off software developers, engineers and data scientists, recruiters say.

After contributing to leading-edge software capabilities at places like Microsoft, Google or Meta, suddenly available tech workers aren't eager to apply for day-to-day information-technology jobs, they say.

"If you're a young hotshot code developer, Honeywell may not be on your list of top five or 10 companies that you want to go work for," said Kevin Dehoff, president and chief executive officer at industrial giant Honeywell's Connected Enterprise software group.

The company currently needs software developers to drive growth; despite market turbulence, Honeywell has seen revenue gains over the past year, Dehoff said. Though tech-sector layoffs have flooded the market with talent, "we've had to kind of carve out a talent brand that would appeal to those developers," he said.

For Honeywell, that has meant offering sought-after candidates a chance to go beyond writing run-of-the-mill software code. Instead, Dehoff said, the company is offering roles with a greater sense of mission in designing innovative software apps to solve real-world business problems or broader sustainability issues.

Honeywell and other companies trying to snatch cast-off tech workers face long odds, said Lauren Illovsky, talent partner at CapitalG, Google's independent venture investing arm.

"One of the challenges these CIOs will have is that, yes, there is a lot of talent out there now, but these people might not be ready to make that move out of the tech sector," she said.

In general, it is rare for a Big Tech worker to uproot and move to the IT department of a retailer, insurance company or other non-tech business, she said. "If Fortune 500 companies really want to compete for this talent, they have to ask themselves, how do we make this the kind of company where these people are going to want to work?"

The current uneven economy will make that even more difficult, as companies cut IT budgets and put moonshot projects on hold.

So far this year, employers across the tech sector had laid off an estimated 194,659 workers as of Wednesday, already outpacing the roughly 165,000 for all of 2022, according to data tracker Layoffs.fyi. Though many of those who lost jobs were in sales, marketing or administration, the cuts have also included the tech workers long been prized by chief information officers and other recruiters at companies outside tech.

Last month, U.S. employers across all sectors posted more than 300,000 ads for open tech positions, a six-month high, according to IT trade group CompTIA. 

All told, U.S. employers added 253,000 jobs in April, the highest increase since January, pushing the jobless rate to a decades-low 3.4%, the Labor Department said earlier this month.

An estimated 90% of workers who have been laid off by large tech companies have already found new jobs, said Ruth Ebeling, managing director and partner at Boston Consulting Group, a management consulting firm.

Most have stayed in the tech sector -- U.S. tech-sector employers added 18,795 workers in April, CompTIA estimates -- with about 40% joining startups or other small tech firms, Ebeling said. "They are not waiting around to be scooped up by the IT functions of Fortune 500 companies," she said.

Indeed, in the wake of tech-sector layoffs many large employers are now competing for talent against early-stage startups, said Art Zeile, chief executive of tech-career marketplace Dice. Among other benefits, startups give these workers a better chance of experimenting with untested software tools, or playing a bigger role in decision-making, he said.

Software developers and engineers have also grown accustomed to working remotely, Zeile noted, an option that larger employers are less likely to provide.

The differences in workplace culture between tech and non-tech companies can also be stark, said Cenk Ozdemir, cloud and digital practice leader at PwC.

"The tech sector typically operates on an agile basis and it is fast-paced, leveraging the latest methods, tools and technologies," Ozdemir said. "Companies in other industries may take a slower, but stable approach."

Yet another issue is pay. For years, the tech world's biggest employers have snagged in-demand workers with lavish pay and benefits -- packages that most companies outside the sector can't match." [1]

1. Laid-Off IT Staff Shun Run-of-Mill Work --- Recruiters at firms not specializing in tech are at disadvantage over work culture, pay. Loten, Angus. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 18 May 2023: B.5.