Tech hiring has fallen close to pre-pandemic levels

Amid an industrywide shake-up and widespread layoffs, there’s no crystal ball for what tech talent should expect in 2023—but aggregate data on job openings may be the next best thing.

When you look at data from job platforms like Indeed, LinkedIn, and ZipRecruiter, many of the takeaways line up: Tech hiring peaked in mid-2021 but has fallen substantially, approaching pre-pandemic levels in some categories. Postings for software developers and related jobs are on the decline. These trends come as tech giants from Alphabet to Amazon—companies that once seemed impervious to large-scale layoffs—have laid off tens of thousands of workers, slowed hiring, and announced plans to “do more with less.”

“It’s clearly a period of reckoning…There’s a painful recalibration going on right now,” Nick Bunker, Indeed’s director of North American economic research, told us. Later, he added, “What is notable about the really strong pullback we’re seeing in 2022 and now into 2023 is that these were sectors that did particularly well in 2021 and late 2020. There was this really big rise in hiring appetite for the tech sector…and now things are swinging the other way.”

Compared to February 2020, active online job postings in the US tech sector are up only about 2% through late January, according to ZipRecruiter data shared with Emerging Tech Brew.

“Job openings often give you a good sense of what’s going to happen in hiring in the coming months,” Julia Pollak, chief economist at ZipRecruiter, told us. She added, “It’s not looking so great in tech right now. But, that said, many companies had an amazing opportunity with these once-in-a-lifetime conditions during the pandemic to grow very rapidly, to expand their headcount, and to make huge bets…What we see happening in company after company is that they’re not shutting down hiring across the board—they are rebalancing and shifting.”

Trending down and up

When it comes to tech sector jobs, “there’s been a really steep drop-off in pretty much everything,” Pollak said.

ZipRecruiter data shows that compared to February 2020, data job listings are up just 5%—down 11 percentage points from last month, a “pretty big decline between December and January despite the normal seasonal expectation,” Pollak said. Web administration jobs were down nearly 37%, desktop support jobs were down more than 10%, and many other role categories, although slightly up since February 2020, were down significantly from tech’s 2021 hiring peak.

Data from Indeed suggests a similar trend for software developer roles, a category that includes software engineers and related titles. Although those job postings were still above pre-pandemic levels, at the beginning of January, they had declined by nearly 39% year over year—a “tremendous pullback,” according to Bunker. “Overall postings are down closer to, say, 10%, and there are some sectors [that have] held up better than that.”

But there are still a couple of tech sectors with encouraging hiring rates, Pollak told us, like hiring in the gaming sector, which is still up more than 81% compared to February 2020, according to ZipRecruiter data.

“One area where [tech companies] plan to do a lot of hiring, still, is when it comes to AI and machine learning,” Pollak said, adding, “You can expect tech hiring to be pretty slow when it comes to people like tech recruiters and marketing folks in tech, but still very active when it comes to more technical, AI-focused roles.”

Looking ahead

Pollak predicted we may see increased hiring for tech roles in other industries that can better compete to hire key candidates in the tech space now that offers from tech giants may not be as common—or as competitive.

“Tech jobs outside the tech industry—the demand for tech talent in government agencies, school districts, retail companies, etc.—will partly offset the decline, and so will international demand,” Pollak said.

Even if the overall tech hiring downturn continues, we’ll still likely see a prioritization of hiring in certain areas—and at certain companies beyond the Big Tech bubble.

“For the year ahead, it’s hard for me to see something that causes some big reversal of fortune for hiring,” Bunker said, noting that year over year, ”job postings for these sectors are down quite a bit, but they’re actually still higher than what they were back in February of 2020. There are still some opportunities out there…They just might not be at the sort of firms that did a lot of hiring the past couple of years.”