The State Of The Tech Industry In 2023
**The State of the Tech Industry in 2023: Layoffs and Hiring**
**Introduction**
What’s up everybody, how’s it going? I know I’ve been away from YouTube for far too long. Now, it’s been almost three months since my last video. Life got in the way, but I am back with a vengeance. I’ve got some banger videos already filmed and coming very soon, including this one.
What better way to come back to YouTube than by diving into the state of the tech industry in 2023? In this article, we will explore two key aspects: layoffs and hiring. While I have covered the tech industry extensively in my previous videos, a lot has happened since then. So, let’s jump right into it.
**Layoffs: A Widespread Phenomenon**
It’s no secret that we have been witnessing layoff announcement after layoff announcement from companies of all shapes, sizes, colors, and flavors. Layoffs have affected small companies, big companies, profitable companies, struggling companies, and everything in between. It seems like every single company is affected, and no company is immune to layoffs.
Let’s take a look at some recent examples. Clubhouse, which was super popular in early to mid-2021, recently laid off 50% of its staff. Lyft, a non-profitable company, laid off 26% of its staff and paused hiring or eliminated 250 open positions. Even big-name companies like Meta (formerly Facebook), Amazon, and LinkedIn have announced layoffs. Profitable companies like Dropbox and Shopify have also made the difficult decision to lay off employees.
So, what is happening? Is the tech industry imploding? It may seem like a death spiral of doom and gloom, but the truth is not quite as dire as it seems.
**The Real Reason Behind Layoffs**
The reality is that many companies, including the most successful ones like Google, Facebook, and Shopify, made significant mistakes over the past few years. They over-hired, even when they were not profitable or struggling. This over-hiring, which included hiring employees who were not actually needed for the business, has now come back to haunt them.
It’s important not to solely blame these companies for the layoffs. While we should feel empathy for the employees who lost their jobs, these companies had no choice but to make these difficult decisions. They had embarked on unnecessary “side quests” that had no business being pursued. Just like subscribing to multiple streaming services and realizing you don’t watch any of them, these companies had to cut back on unnecessary expenses.
The CEOs and leaders of these companies are not devoid of emotion and empathy. They don’t enjoy ruining families and people’s livelihoods. They also understand that multiple waves of layoffs are not a good look for their company’s reputation. Additionally, there is a limit to the number of employees certain companies can lay off before they can no longer function. Not every company can undergo a complete makeover like Twitter did with its 2.0 version.
Rest assured, these companies do not want to continue with layoffs. They have taken the necessary steps to address their over-hiring mistakes, and we are approaching the end of this cycle.
**The State of Hiring: A Promising Outlook**
Now, let’s shift our focus to the state of hiring in the tech industry. I have three data points that suggest we are reaching a promising moment in time for tech hiring in 2023 and beyond.
**Data Point 1: AlgoExpert.io**
As many of you know, I run algoexpert.io, a platform that helps software engineers prepare for technical interviews. Our product and company are directly tied to hiring trends. If there is a lot of hiring happening, there will be a high demand for our product, and we will thrive. Conversely, if hiring slows down, we will suffer along with it.
While we have seen some impact from the recent developments in the tech industry, we still have a significant demand for our product. We have new customers and tremendous usage on the platform. This indicates that hiring and interviewing are still happening. Otherwise, our platform would be inactive. Despite the challenges, there are still many companies out there that are hiring, and software engineers need to prepare for their interviews.
**Data Point 2: TrueUp.io**
TrueUp.io is a website that tracks the number of open tech jobs at any given moment. Since the beginning of 2022, the chart shows a decline in the number of open jobs. However, there is a glimmer of hope. Since late January or early February 2023, the number of open jobs seems to have plateaued. This suggests that the bulk of the damage has been done to hiring in the tech industry.
While some may argue that this plateau could be a consolidation before another decline, there are reasons to believe otherwise. Many big tech companies have already paused hiring or closed all their open positions. They have reached their limit in terms of layoffs. On the other hand, companies in other industries, such as banking, healthcare, and travel, are still hiring aggressively. They see this as an opportunity to catch up on their tech talent. This combination of factors leads me to believe that the chart will flatten out or stay flat for the next few months before starting to creep back up.
**Data Point 3: Anecdotal Evidence**
Anecdotal evidence also supports the notion that hiring is still happening in certain industries. In a previous video, I predicted three big trends for the 2020s: blockchain development, ML/AI, and IoT. These trends have proven to be accurate so far.
The blockchain industry is thriving, with significant investments and software development taking place. Companies like OpenAI and Chainlink Labs are actively hiring engineers, not just in their specialized fields but also in other areas of software development. These companies are not alone; many others in their respective spaces are also hiring. This indicates that there is still a decent amount of hiring activity happening in the tech industry.
**Conclusion**
In conclusion, while layoffs have been prevalent in the tech industry, it does not signify an industry-wide implosion. Companies made mistakes by over-hiring, and they had to make difficult decisions to rectify those mistakes. However, we are approaching the end of this cycle of layoffs.
On the hiring front, there are promising signs. Platforms like AlgoExpert.io continue to see demand, indicating that hiring and interviewing are still happening. The number of open tech jobs seems to have plateaued, suggesting that the worst may be behind us. Additionally, companies in industries like banking, healthcare, and travel are actively hiring, providing further evidence of a positive hiring outlook.
While challenges remain, the tech industry is resilient and will bounce back. The future holds opportunities for software engineers and tech professionals. Stay tuned for more updates on the state of the tech industry in 2023 and beyond.
**FAQs**
**Q1: Are all tech companies experiencing layoffs?**
A1: While layoffs have been widespread, not all tech companies are experiencing them. However, many companies, including big names in the industry, have had to make difficult decisions due to over-hiring or other factors.
**Q2: Will the tech industry recover from the layoffs?**
A2: Yes, the tech industry will recover from the layoffs. Companies have learned from their mistakes and are taking steps to rectify them. Additionally, other industries are actively hiring tech talent, providing opportunities for professionals in the tech industry.
**Q3: Should software engineers continue to prepare for technical interviews?**
A3: Absolutely. Despite the challenges, there is still a demand for software engineers in the tech industry. Companies are hiring, and it is crucial for software engineers to stay prepared for technical interviews to secure new opportunities.
**Q4: What industries are still hiring in the tech sector?**
A4: Industries such as banking, healthcare, and travel are actively hiring tech talent. These industries have recognized the importance of technology and are looking to catch up on their tech talent needs.
**Q5: Is the worst behind us in terms of layoffs in the tech industry?**
A5: While we cannot predict the future with certainty, the data suggests that the worst may be behind us. The number of open tech jobs has plateaued, and companies have reached their limits in terms of layoffs. This indicates a potential recovery in the hiring landscape.
Related videos
Watch LaterAdded
Watch LaterAdded
Watch LaterAdded
Watch LaterAdded
Watch LaterAdded
Watch LaterAdded
Just because more people are paying for AlgoExpert doesn't mean more people are getting jobs. People who got laid off may be desperately subscribing just in hopes that it'll help them land a job in the future.
Clement na Idan !!!!!
The future of software engineering:
Humans think of efficient solutions to solve problems in natural language.
Then the rest the computer do:
Translate all the thoughts made to computer code so that the solution can be executed, thanks to large language models like ChatGPT.
So in the near future, software engineers need not to code or go low level. Just think how to solve the problem efficiently at high level, natural language.
just some comment
The bubble is bursting 😅😢
love the vid wish i had more money to spare to buy the preb help after I'm done with my collage degree soon 🙂
Where da heck have you been?😊
they laid people off to make way for chatGPT
As a high school student , who don't like studies that much i find layoff a good excuse 😂
To say see these all people worked soo hard and lost all in matter of seconds.
Btw feel sad for those who lost jobs.
A significant piece to this puzzle is the incoming replacement of large percentages of the required labor force through AI application. I don't think anyone would argue that AI has the capacity to replace all jobs today however tedious and time consuming tasks are now being delegate to AI – reallocation of time and projects will result in a substantial reduction of available work. I do not foresee a sudden increase in hiring at any point in the future (at least within mainstream tech).
Your last point on non-traditional tech industries opening up to software engineers makes sense but from the perspective of, say, a big bank – profit margin is everything (very different from our future-oriented friends in traditional tech who couldn't care less about profits) and so I think they will be slow to adjusting.
Friend is the global elite dictatorship so dominant to you that you are afraid to say that this is all due to the rampaging evolution of Ai related tech? And it is gonna get much worse?
relax bro… why are to shaking and moving too much?
The state of the tech industry is that the job wants 5 years of experience in the exact stack, every time.
Long time fan of algo expert and your videos. I'd like to hear you talk about the problems with software engineering saturation.
Yes I hope you are right, we have hit bottom and companies will start to hire again, but I've also seen companies completely change their hiring models to only want senior level and above, and they know they can do so because the market is flooded with talented engineers who were laid off.
AlgoExpert is a product that focuses on interviewing, not hiring. Your data will lag behind what's actually going on in hiring quite a bit, especially because interviewing in tech takes longer than it does in other industries. For example:
If a bunch of layoffs happen, and suddenly 100,000 new people decide to give software engineering a try and they buy AlgoExpert, and 4+ months later, they don't have a job and go back to whatever non SWE work they were doing before, it still shows up in your data as "demand for a product" but the part where they don't get hired will not show up.
I still subscribed to more than 5 streaming services … although I mostly only watch YouTube 😅 … and I also subscribed to algoexpert although I haven’t been using it for the past year
Thanks for this video, Clement!
By context of overhiring, there’s also the retrospect of the amount of debt also pulled out with 0%/near-to-nothing interest during the pandemic, there were also hiring freezes with google and Microsoft during the pandemic
I don't agree with the "over hiring thing" because when you see they layoff 50%+ of their recruiting teams, that means they are not planning to hire because of recession !
Other pont why Amazon is firing, people still use Amazon !
Rather than hiring more, I'm sure many companies are going to make SWEs work more to speed up productivity. They tried to increase productivity by hiring more SWEs and then realized that it didn't work well. They might hire only a very significant role. The future of SWEs is going to be like CPAs. They used to be highly paid and there were so many demands for them in the past but now the majority of them make an average salary. The job market for them is also kinda moderate.
This person was barely in the industry. You should certainly be skeptical when hearing his viewpoints.
Could people seeking more interview prep imply hiring is slowing down, since people are having to do extra preparation for interviews? Like there are less openings so it's more competitive?
but i think that if you have enough guts you can create your own software company for little and medium enterprise
Clement, a CEO does not need to fire when they make Millions, they just choose to do layoffs and keep their salary the same.
As a plumber, this is interesting.
Apple => 0 Layoff.
It's crazy how many of my swe friends hate blockchain
I got laid off it sucked. Had to wade through the garbage and finally got picked up by a tech adjacent company due to all the competition out there rn
You made my day man. Love u ❤
SUMMARY: We're screwed all the way into end of 2025!
I call 🐂💩 I believe you're sincere, but your research is biased toward data that supports the success of your own ventures.
Other sources, notably not many on YouTube, say the layoffs are far more than a correction of over-hiring during the pandemic years. Sources which are not focused on tech are suggesting that the US and other economies are headed into a recession. Experienced recruiters (10+ years) have told me first-hand that they are seeing far fewer opportunities than at any other time during their careers.
I'm looking into becoming a full stack developer. What is your though on the job market for it in the next 6 months? Also, within tech what occupation would you stay is safe from being automatized by AI such as CHATGPT and outsourced? I'm thinking it cybersecurity?
I think many software developers are facing a bigger issue.
They don’t stand out.
They can do anything but at the same time they haven’t master one niche very well.
jesus, 3 months? no wonder your videos are not showing up in my feed.
I think this misses a lot of bigger things happening in the world. 1) No one is really sure how bad this coming recession will be. While I don't necessarily subscribe to the dooms day second great depression thoughts, I do think there's a fair chance this one could be painful. 2) No one is sure how much more interest rates are going to rise. Money is no longer cheap, so you better be damn sure you're getting the most return on the people you employ and if you're going to hire someone else, they better damn well be doing the same.
Why doesn't he get that many views anymore.
When people get selected in a firm after taking interview courses and not genuine experience they are bound to get fired.
I was in one of the companies that are mentioned here and I was in the core of the business and making very direct business impact.
So let's be more precise: They cut staff overall across the board and not directly the ones that did not have business impact.
Is this a hot take?
Where did you get the graph @7:00 ?
If you live in the US, good luck. That antichrist country gives a sh** about people
I would also say (regarding the layoffs in the states) – there alot of people working in "tech" but not actual doing coding or tech.. or even can do that! Alot of yoga chicks were layed off at Twitter – doing none to nothing the last couple years.. People who are really good in tech, will find a job!
I truly believe in 9-5 job, if you love your 9-5 be positive and just keep changing and growing yourself day by day..
If they had to do these layoffs due to overhiring, then why are they hiring again, right after layoffs? 🙂
Guess the narrator forgot to do a little deeper research on why these companies laid off – ITS BECAUSE THEY WERE TOLD TO BY ASSET MANAGERS. It happened right after Biden took office and slapped a lot of restrictions on US domestic oil production, which sent the speculators to gouge the energy sector.
Then the US happened to unrestrict the number of H1B candidates, so there is no employment restrictions that other countries have that prevent this. The US allows more freemarket to determine need for workers. Other countries limit this, and a company has to prove they could not find a national first in second round of attempts (documented or fined).
Layoffs will coincide with interest rates now. No company can fund any new project right now, as regional banks have been running scared as depositors remove their cash and throw it into Big Fund money markets (doubt me? check the stats on record amount of cash influx to those companies – Charles Schwab, Vanguard, etc.) So until the Fed reins back in the unprecedent rush to increase interest rates away from the QE days of covid. Only Japan (who arbitrage FX trades us as a baseline currency) has interest rates near 0.
So you really have Fiscal policy (Biden Admin) pushing $6 trillion into the economy to fund non-high tech companies.
Asset Managers still hold supreme. Just think of a company holding $10 billion of your stock? The threat of them selling off your shares? That will send a CEO's bonuses into nothing burger world. That is what is happening… we need to reign in Asset Managers and stop creating tax loopholes they use to gouge US citizens of jobs, real estate and the type of cars we can drive.
you should make a banger video for real, new venture
They fire bc they want to profit more…. That simple
Cap ass video