Laid-off techies struggle to find work with highest layoffs since 2001

Alison Croisan, a data scientist with about a decade of experience in technology, was fired from PayPal earlier this year, joining the masses unemployed in his industry. Croisant has one word to describe the job search process right now: “Crazy.”

“Everybody else is getting laid off, too,” said Croisan, who lives in Omaha, Neb., where she worked remotely for PayPal.

Her feeling is reflected in the numbers. Since the beginning of the year, more than 50,000 workers have been laid off by more than 200 tech companies, according to the tracking website Abbreviations.fyi. This is a continuation of the prevailing theme from 2023, when more than 260,000 workers at nearly 1,200 technology companies lost their jobs.

Alphabet, Amazon, Meta and Microsoft have all been involved in the cut this year, along with eBay, Unity software, SAP and Cisco. Wall Street has largely welcomed the spending cuts, sending many tech stocks to record highs on optimism that cost discipline combined with efficiency gains from artificial intelligence will lead to rising profits. PayPal announced in January that it was eliminating 9% of its workforce, or about 2,500 jobs.

For the tens of thousands of people in Croisant’s position, the road to re-employment is daunting. Overall, 2023 was the second-biggest year of layoffs on record in the tech sector, trailing only the 2001 dotcom crash, according to outplacement firm Challenger, Gray & Christmas. Not since the spectacular Pets.com, eToys, and Webvan fires have so many tech workers lost their jobs in such a short period of time.

The number of job cuts last month was the highest of any February since 2009, when the financial crisis forced companies into cash-saving mode.

CNBC spoke with a dozen people who have been laid off from tech jobs in the past year or so about their experiences navigating the job market. Some spoke on the condition that CNBC not use their names or detail their situation. Taken together, they paint a picture of an increasingly competitive market with job postings that include strict qualification requirements and come with lower pay than their previous gigs.

This is a particularly perplexing situation for software developers and data scientists, who just a few years ago had some of the most marketable and highly valued skills on the planet and are now considering whether to leave the industry to find work.

“The market is not what it used to be,” said Roger Lee, creator of Layoffs.fyi, in an email. “To secure a new position, many marketers and recruiters are leaving technology entirely. Even engineers make trade-offs – accepting roles with less stability, a tougher work environment, or lower pay and benefits.”

Lee said tech workers’ wages have “largely stagnated” over the past two years, citing data from Comprehensive.ioa reward tracking tool he recently helped launch.

Croisant’s job search involved applying for some positions that garnered hundreds of applicants. She could see this data using LinkedIn’s Talent Insights platform, which shows how many people are vying for an open role.

In addition, some postings required applicants to have advanced degrees or work experience in machine learning and artificial intelligence, a new development in Croisant’s experience in the job market.

During a five-week job search, Croisant said she applied to 48 jobs and received two interviews. In the end, she chose to accept a lower-level data analyst role and a roughly $3,000 cut in her base pay to take a contract role starting next month at a financial technology company.

“It was an absolutely terrifying experience for me and I’m not sure if I’ll ever feel really safe at work again,” Croissant said. “But at the end of the day, I’m still one of the lucky ones. I have friends who have been looking for months and still haven’t found anything.”

“It’s humbling”

Kristen Powers was fired in January from travel tech startup Flyr after two years in marketing at the company. She said navigating the current job market is like a full-time job, “sometimes even harder.”

“You put out resumes and you get almost instant rejections,” said Powers, who has worked in marketing for a decade. “It really affects your confidence and you get this kind of impostor syndrome.”

Powers lives with her husband and two children in the small town of Natchez, Mississippi. A month before she lost her job, her family bought a new house. Powers said relocating is not an option and she is only considering remote roles in marketing. However, she is willing to take a pay cut.

“It’s humbling for sure,” she said.

The same dynamic plays out across the industry, even for former employees of Googlewhich was long considered the home of Silicon Valley’s elite talent.

Christopher Fong, who worked at Google from 2006 to 2015, is the founder of a group called Xoogler.co, which seeks to provide help to people laid off by the Internet company. The 9-year-old organization, comprised of thousands of Google alumni and current employees, offers peer support and hundreds of in-person events.

In January, Google eliminated several hundred positions in its hardware, core engineering and Google Assistant teams. A year earlier, the company cut 12,000 jobs, or roughly 6 percent of its full-time workforce.

Fong said the “biggest challenge” today for many ex-Googlers is finding work that maintains their previous pay level.

Michael Kasczak, who was laid off from Google last March, took a different approach to his job search.

Kascsak said he welcomed the pay cut to start as head of talent acquisition for veterinary business CityVet in January after applying for hundreds of jobs. He acknowledged that his previous employer had set extremely high compensation expectations.

“I went into this knowing that I was fortunate enough to work at a top percentile paying company, and I’m realistic. I prepared myself to be flexible,” said Kasczak, who lives in Austin, Texas and previously worked in talent scouting for Google. “I’m fine with the pay now because I’m in an environment where I want to be with great people.”

Technology has been a notable departure in a job market that has been largely stable over the past two years. Nationally, the unemployment rate rose to 3.9% in February from 3.7% each of the previous three months. It has been mostly in that range since early 2022. The U.S. economy added 275,000 jobs in February, topping 200,000 for the third month in a row.

Sentiment indices are mixed. Job review website Glassdoor’s Employee Confidence Index, which measures how employees feel about their employer’s six-month business outlook, sunk to its lowest level in February since sentiment data first began in 2016. Among tech workers, layoff discussions on Glassdoor have more than quadrupled in the past two years and were up 12% last month from a year earlier .

However, ZipRecruiter’s job seeker confidence index has been rising since mid-2023 and rose to its highest level in fourth quarter from the second quarter of 2022

Even in technology, there is a huge divide in the current market. Layoffs.fyi’s Lee said AI is driving “a return to rapid hiring and growth” even as layoffs continue elsewhere. Salaries for AI engineers rose 12% from the third to fourth quarter of last year, and the average salary for a senior AI engineer nationally is more than $190,000, according to Comprehensive.io.

Amit Mittal has been on both sides of the job market—previously as a hiring manager and now as a job seeker.

In November, Mittal was fired from the AI ​​lending company Upstart, where he worked as a software engineering manager, often overseeing interviews. Mittal said he has seen the hiring process become “much more demanding” as layoffs have grown.

“There was a lot more pressure on us to raise the bar higher and higher,” he said. “Someone with four years of experience in the past would have a pretty good chance of getting a good job. But now they’re competing against people who have six, seven, eight years of experience in the same position.”

Mittal, who is from India and has lived in the Chicago area since 2007, has been under a very different kind of pressure lately. According to his H-1B visa, Mittal had only 60 days from officially ending his job to find a new job in the tech industry to stay in the country.

“If for four months I have to pay my bills by driving Uber or working at McDonald’s flipping burgers, that’s fine,” he said. “But that mechanism doesn’t exist for me.”

Mittal has now successfully petitioned for a separate B-2 tourist visa, giving him an additional six months to find a new job. It was not a cheap effort, however. He estimated he spent about $8,000 in legal and administrative costs related to his filing.

In all, Mittal said he applied for about 110 jobs to no avail. He attributed the lack of success to the unwillingness or inability of employers to sponsor visa holders.

“It seems the opportunities are pretty slim right now, even though I’m seeing hundreds of posts every day,” Mittal said.

Bill Vesey was laid off by eBay in January after a 13-year career as a software engineer at the online retailer. He said he was learning the rules of the “new game” and they were much different than he remembered.

“Achievability is not just a numbers game,” said Vesey, 64, who lives in Santa Cruz, California. “It’s a combination of how well you brand yourself, about your networking access to any given position — to the hidden job market.”

Vezey said he hopes to be rehired by his longtime employer and wants to stay in the tech field.

“I’m kind of an incurable optimist, despite what 60 years of life has brought,” he said.

Like many of those who spoke to CNBC, Powers said he spends his days building his resume. for vacancies, scan online job postings and apply for newly posted positions. She networks by contacting a recruiter or hiring manager related to each role, though she said some recruiters ghosted her as quickly as they expressed interest.

She had several interviews and turned down one job offer. This position would have required her to go into an office while taking more than a 50% pay cut from her previous job. And she had to find a babysitter.

“There’s a sense of impending doom,” Powers said. “There’s a point where the money runs out and the options get really bleak.”

Still, Powers said he’s trying to stay optimistic “because giving up isn’t going to get me a job.”

— CNBC’s Jennifer Elias contributed to this report.

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