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Has the bubble finally burst? Here are four hiring trends engineering managers should be aware of as we move into 2023.

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It’s hard to imagine now, but 2022 began with burgeoning salaries and bumper pay packets for individuals with the right IT skills. Then, as the year drew to a close, a distinct chill could start to be felt across the technology industry following a wave of layoffs.

The statistics make for grim reading. In November alone there were more than 60,000 layoffs across the sector, and things aren’t slowing down.

Take CircleCI, the CI/CD vendor, which announced a 17% cut to its workforce in early December. According to CEO Jim Rose, the company has been forced to “acclimate to this new economic reality.” That new reality involves a major shift from growth at all costs, to something somewhat more sustainable. Other tech companies, such as Microsoft, Netflix, Salesforce, and Twitter have made substantial layoffs or implemented hiring freezes of their own in recent months.

All of these factors could mark an abrupt change for many engineers who have become accustomed to operating within a high-growth industry and engaging in a fierce war for talent.

Now, engineering managers will need to think carefully about how they construct their teams as we move into a potential economic downturn. Here are four hiring trends we are seeing that you should be aware of.

A changing of the tide?

If recent events have turned the tide from a long-time candidate-driven market, this could provide an opportunity for managers without hiring freezes to access a newly expanded pool of talent at a discount; especially when hiring experienced engineers looking for instant job security in a choppy market. The days of robust salary negotiations at the offer stage could also come to an abrupt halt if the tide has indeed turned towards the employer.

However, while rates of pay for engineers will likely not record the double-digit increases seen in 2022, it’s also unlikely that they will decrease. Runar Reistrup, CEO of freelancer platform YunoJuno noted that day rates in the IT sector will likely “plateau” in 2023 compared to what he described as years of “phenomenal” growth in 2022 and 2021.

Some organizations may look to be more flexible during this period of uncertainty by leaning more heavily on contractors than making permanent hires. According to a report by recruitment firm Robert Half from October last year, 79% of tech managers are already turning to contract professionals to address skill gaps among permanent staff. Reistrup says many of the companies that he has worked with have already made this shift too.

When it comes to specific roles, Liam Reynolds, CEO at job fair organizer Silicon Milkroundabout, noted that “there's still a high demand for software engineering skills – frontend, backend, and full stack,” but there had been a distinct fall-off in calls for data scientists.

Reynolds also thinks junior engineers may struggle to find their first role in this market. “What companies tell us,” he said, “is that they have a lack of senior talent who can train and mentor juniors.”

That might not necessarily be a bad thing for junior engineers however. Sarah Polan, Field CTO at Hashicorp, says, “if you bring in a junior hire at this point, it’s actually a really great starting point, because they will get all this hands-on experience.”

The demands of the early part of 2022 has also made itself felt in how companies might recruit in 2023. Yannis Lagogiannis, managing director at Apple device management specialists DataJAR, was burned by recruiters putting forward unsuitable candidates during the hiring frenzy of previous years. This year he plans to advertise via LinkedIn and leverage local networks in order to fill positions.

Hot (or not) skills

When it comes to programming skills worth banking on, some things never change. According to 2022's Stack Overflow Developer Survey, JavaScript has retained its crown as the coding technology most popular with developers, even as ‘safer’ languages such as TypeScript continue to make inroads.

The Rust language looks set to rise in importance in 2023 thanks to developer and architect preference. Its architecture is inherently safer (certainly in terms of memory safety) than C and C++. Google has made Rust the default language for new code in the Android Open Source Project, and Linus Torvalds has indicated that the language is headed into version 6.1 of the Linux kernel. Sure, the implementation in the latter is only at an early stage, but is a strong indicator of the direction of travel.

There is also a warning here. While beloved languages like Rust continue to grow in popularity, engineers should think carefully about which languages to build their career and teams around in a tighter jobs market.

Polan also sees security skills as maintaining their importance as we move into 2023. “I think every vendor has their own spin on zero trust,” she said, adding that factors such as the geopolitical situation would continue to raise the importance of security engineers. “You can never go wrong with security and making sure that that's in place,” she said.

The rise of the robots

Another unavoidable trend for 2023 is the rise of generative AI, specifically coding assistants such as GitHub Copilot, which emerged from technical preview in 2022. It takes natural language requests and churns out coding suggestions. In use, it’s a bit like auto-complete for your code. Like them or loathe them, these coding assistants could start to augment engineering teams and increase productivity, without a significant increase in cost.

“I believe the conventional idea of ‘writing a program’ is headed for extinction, and indeed, for all but very specialized applications, most software, as we know it, will be replaced by AI systems that are trained rather than programmed,” wrote Matt Welsh, CEO and cofounder of Fixie.ai, in a provocative article titled The End of Programming. “I am not just talking about things like GitHub's Copilot replacing programmers. I am talking about replacing the entire concept of writing programs with training models.”

That being said, automation and AI tools are unlikely to result in fewer engineers being hired just yet. “It will probably just make [the technology] more accessible to even more companies, who will invest even more into it,” said YunoJuno’s Reistrup. “The whole sector … benefits from the fact that slowly or quickly, willingly or kicking and screaming, every industry in the world is being digitized.”

Skilling up for the cloud

The pandemic may have caused a great cloud adoption surge, but implementations have not always been as well thought through as they might have been given more time and care. Engineering managers must now contend with a different set of resilience, security and cost concerns, as well as how to effectively run multicloud environments in response to these challenges.

While building skills around a single cloud provider may have seemed a safe bet in recent years, the trend towards a multicloud approach is changing the game for engineering managers. Contending with complex security and regulatory concerns should also be at the front of your mind as we round into 2023.

Reflections

The hiring landscape has undoubtedly changed as we move into 2023. Engineers and their managers are facing new uncertainties after several years of seemingly unstoppable market growth.

While the tech giants tighten their belts, others are having to make tough decisions in the face of changing economic conditions. The tech industry will continue to change and evolve, as must its practitioners.