15 July 2022
The tide is turning for North American tech. After months of labor shortages, the job market may be starting to turn around. But recruiters should not forget the lessons of the past few years.
By Marc André Nataf, Managing Director of Cegid North America
North American recruiters, especially those in the tech sector, have just come through several tough years. Every day, they’ve wondered how to find new talents that can help their companies grow. This period of tightness in the job market seems to be coming to an end. Y Combinator, one of Silicon Valley’s most renowned seed funds, has just recommended to its investors to “prepare for the worst”. In the same breath, it asked start-ups to reduce their expenses and focus on their profitability, explaining that fundraising would be more difficult in the coming months. But fewer fundraisings also mean a hiring freeze, and even staff cuts for those who are not yet making money.
We won’t go back to the old world
The rise in US interest rates, deemed necessary to regain control of inflation, as well as the sharp drop in the valuations of technology companies on the stock market, are considerably changing the situation for this sector, after a euphoric year in 2021. Some companies are already on the defensive. At the beginning of May, Meta announced that it was reviewing its hiring pace downwards. The same goes for Microsoft’s office automation branch, Snapchat and Coinbase, the Nasdaq-listed cryptocurrency exchange platform. On the start-up side, the decisions are even more radical. In tech, since the beginning of the year, a hundred of them have fired employees.
One of the biggest consequences of this movement – of which we are only at the beginning – is an expected shift in the balance of power between employees and employers. While data scientists, developers and software architects have been in a position to dictate their terms everywhere, it could well be that the hand will return to the companies still able to hire. They will once again find themselves in a position to be seduced and to choose their applicants. Should their HR managers expect a return to the “back in the day world”? That would be an illusion. They will have to continue to fight to convince, for several reasons.
The years we have just gone through have put meaning back at the heart of priorities. It is what attracts and retains talent. Meaning for the company, of course. Today`s candidates expect a company to respond to their values and propose a goal that is not only commercial. A meaningful purpose, respect for the environment or diversity are no longer options and companies must be able to attest to the seriousness of their commitments in this respect.
“Where do you see me in five years?”
Candidates aspire to a balanced life. So we will not go back on a dose of telecommuting that has become indispensable – even if Elon Musk claims the opposite – or we will lose them. They also need perspective. To the famous question “Where do you see yourself in five years?”, they answer “What means do you give me to progress during five years? More than ever, internal mobility must therefore be managed and encouraged, thanks to forward-looking management of jobs and skills. Knowing your employees and listening to them is essential. But we must also be able to anticipate market needs.
Meeting this challenge requires the implementation of appropriate training programs, which also help to retain employees. According to a famous study conducted by Dell in 2017, 85% of jobs in 2030 will correspond to professions that did not exist five years ago… The development of an internal learning culture is therefore crucial for all organizations.
The ability to detect talent, to train them, to develop their skills and their careers… It is on the condition that they prove their maturity in this area that companies will benefit from a probable influx of candidates. And, in the future, they will be able to keep their new hires when the tech industry rebounds!