The Big Companies In The Tech Sector Are Experiencing Cuts, While The Demand For Tech Workers Is Still High

The year 2023 was open in a big shock for many tech employees, as in the US alone 60,000 employees were sent home from the major tech companies. The big companies fired around 1-6% of their workforce. While IBM for example, fired only 1.5% of its workforce, and Meta fired 13% of its workforce – some other companies such as Google, Pinterest, Spotify, PayPal, eBay, Microsoft, and Dell fired around 3-7%.

Why do These Wide Layoffs Take Place Now?

There are a few reasons that lead to the wide layoffs in the tech sector. According to TechTarget, one of the main reasons is the economic downturn and the post-pandemic times. During the pandemic, the use of online services grew significantly, and as a result, many tech companies hired new employees, to enlarge their workforce and take advantage of the new situation. Now, in the post-pandemic times, the demand for those extra employees has grown smaller. Many of those new employees from the pandemic times were below the entry-level, and now while the companies try to cut off their expenses, those below-entry-level employees are the first to be sent home.

The New York Times attributes the wide layoffs in the tech industry to the slowdown of the rapid expansion in the tech sector. On the other hand, CNBC mainly attributes the layoffs to the deterioration of the economy.

With a different idea of reasoning these layoffs, stands Professor Jeffrey Pfeffer, Stanford graduate school of business. Prof. Pfeffer claims that layoff is an imitative behavior and that the reason for the wide layoffs is the fact that everybody else is doing it.

Does It All Mean That There is No Demand for Skilled Tech Workers in 2023?

On the opposite of the giant companies’ layoffs, stand companies who presented tremendous growth over the past year, and perhaps will not experience any wide layoffs as take place in the giant tech companies. Looking at the fastest growing tech companies in Europe over 2022 that raised over €50m, according to Sifted we can see growth from over 270% to 910% of the number of employees.

In parallel to the deceleration of rapid expansion in the giant tech companies, mostly based in the US, there is still rapid growth of smaller tech companies, which still hire and look for new employees to enlarge their workforce. There are still many positions in the tech sector that experience demand for new employees in 2023 and offer high salaries as is customary in the tech industry.

When looking at the top 10 in-demand tech jobs in 2023, we can find the following jobs:

• Data scientist is supposedly the highest paying tech job, which leads with an annual salary of over $150,000.
• A software engineer who is in charge of creating the software for the need of the business. Usually will get paid around $70,000 – $100,000 per year for a new to this role, while experienced software engineers can earn around $120,000 – $150,000 annually.
• The Product Manager is the one who sets the product parameters and works is the technical team. The average annual salary is over $100,000
• The Front-end developer oversees everything involved in the application for the web and mobile. Front-end developer earns around $80,000-$120,000 annually.
• Cloud engineer deals with the implementation and development of cloud technologies, and earns around $100,000 annually for a beginner, and around $140,000 for a skilled employee.
• Database developer mainly deals with creating the most suitable databases for the requirements. The annual salary is very similar to the one of a cloud engineer.
• DevOps engineer is responsible for IT development and earns on average $120,000.
• A data security analyst is in charge of computer systems and network cyber defense and is paid annually around $70,000.
• The network and computer systems administrator is the one in charge of daily maintenance of the network and earns on average $80,000-$120,000.
• The systems security manager oversees company IT security and is paid on average $150,000.

When looking at the open vacancies for the top 10 in-demand tech jobs according to Expoint, we can see 5,000+ vacancies in the US, Canada, the UK, Ireland, and Australia, while the US is the leading country that offers the highest number of open vacancies.