The tech industry has seen major changes in the past few years, new technologies like Blockchain, IoT, 5G, Generative AI, and Virtual Reality. In short, blockchain is for the finance sector, IoT (Internet of Things) to interconnect devices, 5G will increase download and upload speeds, Generative AI is for streamlining mundane tasks in businesses, and virtual reality has had massive use in the tech and gaming industries.
With these new technologies taking root in everyday life, they looked like high-prospect investments entering the industry. Industry experts, like Deloitte and McKinsey, had a positive outlook on what 2024 would bring. Deloitte claims “that the tech sector could return to modest growth in 2024.” This was amazing news to hear considering the major layoffs from companies like Spotify, Paypal, Microsoft, and Amazon mixed with the low global tech spending that happened in 2023. However, the high expectations for the Industry fell short of how the market worked out this year.
With the past two years of mass job cuts 2024 looks to be taking the same route. Tech companies continue to announce layoffs, amid this advancement of technology. In January of this year over 34,000 people were laid off from over 40 different companies.
In total this year 457 tech companies have laid off 143,136 employees, for some companies these layoffs are a way of restructuring while others had to close down whole departments due to slow revenue growth.
The front page of the Discord app, courtesy of Discord.
One such Company claiming that layoffs are a part of restructuring is Discord. In an internal memo from CEO Jason Citron layoffs are necessary for Discord to become more efficient after a hiring boom in 2020. Discord laid off 17% of its workforce in January which amounted to 170 people. They are currently looking to hire people in engineering, branding, marketing, data, finance, global partnerships, IT, Policy, Product Design, etc with over 45 different job openings.
Though companies are looking forward to restructuring and changes internally, externally the market looks to be in a near crisis state. With so many young people being told to enter into the computer science and tech industry for good jobs and money, there is a massive influx of people who have the skills for the jobs listed. The number of students graduating with a computer science degree has increased by 40% over the past five years. With some job openings having over 5000 applicants though this oversatuation of the market seems evident.
Other factors can explain the view of the tech industry such as low barriers to entry, the issue of remote work & outsourcing, and AI being used for jobs that can be automated.
However, the oversaturation is only seen in entry-level and low-barrier entry positions, such as web and front-end developers. More specialized roles like Cloud engineers and DevOps don’t fill up with applications as quickly because of the advanced skills and experience required for the position. Those who want to work in the tech industry with a stable job in the future are going to have to adopt new strategies such as specializing skill sets, exploring maintenance roles, learning lesser-known languages, and enhancing their soft skills for a chance at getting the positions they want.
Featured image: 457 tech companies have laid off 143,136 employees in 2024, courtesy of Freepik.
