Silicon Valley's monopoly on workers may be challenged after big tech layoffs.

• This year, technology companies such as Google, Amazon, and Discord have announced layoffs.
• In 2023, tech companies such as Google, Meta, Microsoft, Amazon, and Salesforce cut their workforce by 6% to 13%, prompting more technology workers to choose stability over high-growth equity and renowned employment.
• Jeff Spector, president and co-founder of engineering hiring firm Karat, stated that candidates have had the same flight to safety as investors.

In the wake of a year marked by significant layoffs among major tech companies, tech workers are increasingly opting for job security over high-growth equity and renowned employment.

In 2023, Karat's data shows that non-tech enterprises hire 9 out of 10 candidates they offer jobs to, while growth-focused big tech companies (such as those in the FAANG ecosystem) hire only 2 out of 3 candidates they offer jobs to.

In recent years, the gap has widened between hypergrowth tech and other industries. While hypergrowth tech secured more candidates in 2020, economic volatility and the prevalence of tech endeavors in various industries have reversed the trend.

"Candidates are prioritizing safety over potential gains, similar to how investors did during a flight to safety," said Jeff Spector, president and co-founder of Karat.

Given the prolonged high interest rates, dramatic increases in overall cost of living, and layoffs, it makes sense for people to prioritize safety in their career choices. This shift in perspective has caused the tech hubs like Silicon Valley and Seattle to lose their invincibility as a place where tech talent can thrive long-term without job hopping.

In the first quarter of 2023, 584 tech companies laid off people, with the number decreasing throughout the year. Despite this, it was still higher than in 2022. Tech giants such as Google, Meta, Microsoft, Amazon, and Salesforce laid off between 6% and 13% of their workforce. In some cases, like X (formerly Twitter), half of the company lost employment.

Google, Amazon, and Discord all announced layoffs this week, affecting engineering and hardware teams, Twitch, Prime Video and MGM Studios, and 17% of staff respectively.

Looking for the money

The sentiment of disillusionment goes beyond just numbers. A FAANG employee expressed on a Reddit thread that their primary concern is money and career advancement rather than the work they are currently doing. They feel that switching companies may be a more effective way to achieve their goals than striving for a promotion that may or may not materialize.

In 2024, 60% of tech workers are considering leaving their jobs, an increase from 52% the previous year. This presents a significant competitive advantage for non-tech companies looking to attract tech talent.

Non-tech companies are offering stable employment with a focus on cash compensation, which may not hold its value in the short term. Additionally, they are not confined to tech hubs, allowing employees to reside in more affordable cities and decrease their commute times.

According to a 2023 report from CBRE, non-tech companies have secured approximately 60% of tech talent, and they have not experienced any major layoffs since 2022. In contrast, tech companies account for nearly a third of the 700,000 global workforce layoffs by U.S. employers.

Tech workers are most in demand in the aerospace, consulting, health care, financial services, and education industries, according to Art Zeile, CEO of tech careers marketplace Dice. Zeile believes that tech workers can find better work-life balance and more stability in non-tech enterprises with major tech branches than in the tech leaders.

Although there is a trend away from big tech, high-growth companies often provide remote work flexibility and a culture of innovation that non-tech enterprises have historically lacked. While stability is beneficial in the current economic climate, non-tech companies must adapt to retain long-term interest from top tech talent.

Spector argues that less innovation-focused side quests can benefit tech workers by allowing them to witness more projects come to fruition. He notes that big tech companies often have a lot of moonshot and experimental projects, while corporate America outside of big tech tends to prioritize fulfilling projects.

Tech job growth geographically

As a result of recent layoffs, the idea of stability is now a major topic of discussion in big tech, according to Zeile.

Spector has observed that big tech companies are increasingly fulfilling international contracts in countries like India, with enterprises shifting towards domestic full-time talent. This, he notes, is a reversal of the historical trend in these two worlds. "Everybody's starting to move into everybody else's space," Spector said, adding that the tech talent market will become increasingly competitive as geographical wage gaps begin to close.

As technology continues to play a crucial role in various job sectors, candidates are becoming more focused on acquiring the necessary skills to remain competitive in current and future job markets. According to GitHub's 2023 Octoverse report, 92% of all developers on the platform are utilizing or experimenting with AI coding tools, demonstrating the technology's growing influence among tech professionals.

Tech workers are redefining success in the tech industry, moving beyond the traditional notion of working for a top tech company as the only path to success.

Many tech workers currently have the chance to achieve greater stability while continuing with their work, as Spector noted, "Memories are short." However, it's uncertain whether this trend will persist in the future.