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2023 was a no-good, awful, terrible year for those in the tech sector.
Layoffs totalled nearly a quarter of a million across the industry as interest rates soared and companies corrected for post-pandemic overexuberance.
This year has scarcely started better, with worries about the impact generative AI will have on software developer roles only adding to the sense of foreboding many engineers were starting to feel. But there are signs of green shoots, and reasons to be cautiously optimistic that the bleeding has stopped.
Reasons to be happy
An August 2024 UBS analysis of job listings at Google, Amazon and Meta found that while listings for technical roles were down from mid-2022 peaks, job postings had increased year-on-year. Had we hit the bottom?
Listings at Alphabet have climbed above 2018 levels, when UBS started tracking its data. And while technical job postings at Amazon and Meta remained lower than 2018 levels – and are down from the same mid-2022 peaks – they are up from the low ebb of listings in the spring and summer of 2023. UBS analysts said it was “no surprise [there’s] an ongoing focus on engineering talent” when it came to hiring.
“Recruitment in the technology sector has been on a turbulent ride in recent years, with post-Covid hiring peaks followed by reports of layoffs all creating a level of uncertainty for job seekers,” admits Kris Harris, director of technology solutions at the recruiter Robert Half. “However, we are not only seeing a return to stability, but also a level of optimism for the future.”
Robert Half’s surveys of hiring managers in the IT and tech sector have started to tip from pessimism to optimism in the last year, according to Harris, with 46% of hiring managers in the UK are planning to add new permanent positions to their roster in the next six months, while a quarter expect to bring in more contract talent to plug gaps.
“Much of this demand is being driven by innovation in AI integrations, with more firms looking to capitalize on the potential that these tools bring to productivity and efficiency,” says Harris. That changes somewhat the skills those employers are looking for, and could spell a shift in how junior developers should be trained.
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Thousands of opportunities
While the narrative has been one of fallow opportunities for developers, the scale of job postings in the software engineering sector, as tracked by Barclays Research, using Lightcast data and shared with LeadDev, gives more support to a hopeful outlook ahead.
Following 11 successive months of month-on-month decreases in job listings throughout 2023, January 2024 saw a 27% month-on-month increase in postings, with 48,236 open positions. And throughout the year to July, listings have slowly ticked up, topping 51,000 in June.
While January 2024’s levels of 48,000 or so listings pales into comparison with the 83,780 listed a year earlier, the direction of travel is flat or slightly upwards, rather than precipitously sliding down. A significant proportion of that growth in hiring is also coming from outside the usual big tech names. Around 11,000 of the 49,000 listings in June were for positions in S&P 500 firms.
A dissenting view
Not everyone is buying the narrative. “I am not bullish on hiring going into the future,” says Nolan Church, cofounder and CEO of FairComp, and a hiring analyst. “I don’t think there’s going to be a thousand AI companies that have now filled the place of a lot of these companies that just went out of business for the last couple of years,” he says.
There is also the risk that some of the jobs posted online are so-called ‘ghost jobs’, listed to give off the impression their companies are growing in order to help attract investment. Four in 10 companies across all industries have admitted to posting ghost jobs this year, according to a Resume Builder survey in May.
Church points to AI-powered software development tools like Cursor, which FairComp’s development team uses for 40-60% of its code output, according to Church. “That’s going to translate down to less software engineering hiring,” he says.
