Despite a Pending Recession, Tech Talent Is Still in Demand

Surpassing discussions about a great retirement or resignation, finding the right talent will continue to be the biggest challenge this year. Organizations will still be struggling to find the necessary talent, which will be complicated by tech skills being sought after across multiple industries and countries.

Despite a pending recession, tech talent is still in demand.

Finding talent will continue to be the biggest challenge of 2022

One thing is clear: companies who continue to ignore the reality of the new recruiting landscape will quickly find themselves unable to compete for talent against those that have embraced change.

As a recession is looming, the technology labor market could go from being in a frenzied state of flux to being in a roaring flame, but this is no time to pull back on best practices firms have been building around creating a more adaptable organization to the demands of the business.

The tech sector draws the best-educated, best-skilled talent in the job market, and layoffs provide some respite from a hiring squeeze across the wider economy. Even companies that experienced high-profile layoffs, like Peloton, are still hiring developers and other technical roles.

In fact, listings for tech jobs were much higher in May and April than they were at the same time last year, notes Amit Bhatia, the founding partner of Swordfish Investments. At ZipRecruiter, a job listings site, active job listings for tech industries increased from January to April across all job types, including project management and software development, says ZipRecruiter chief economist, Sinem Boer.

A surge of layoffs

So far this year, listed tech firms, valued at a total of $3.4 trillion, announced hiring freezes or layoffs. Private startups, which are safe from the stock market, are feeling the pinch too, with 29 companies furloughing employees since early April, according to, which tracks layoffs across the tech sector.

When companies like Facebook and Netflix stopped hiring or laid off employees, some of those employees frequently found — or joined — startups that might seem risky in comparison with the safety of larger companies.

Another unique facet of the coming downturn will be the widespread availability of gig work — that is, temp jobs without benefits, like driving for Lyft or Uber. When the next recession hits, some jobs might disappear and never return (automation could accelerate this, but that is an article for another time).

With rising inflation and potential future recessions, we could see a starting point for declining turnover rates, as employees become less confident about the outside job market, thereby slowing down job-hopping and increasing job tenure.

As layoffs become more commonplace in the increasingly volatile tech startup landscape, another trend is emerging. A growing number of LinkedIn members are reporting that offers they have received to join a new employer are being rescinded. Coinbase, for instance, has begun pausing all new hires and is also “pulling some accepted job offers.”

The trend to take back job offers exemplifies the turmoil facing the tech sector’s market. Venture capital-backed firms are being hit especially hard as investors abandon risky bets and seek immediate returns.

Resources would still be allocated to technology-related departments, but the strategy would switch for many companies from hiring W2 employees to hiring independent contractors or working with firms that provide staff augmentation. Leading technology organizations will instead leverage high-skilled technical talent, with an emphasis on creating differentiated value for customers and shareholders.

Current list of layoffs

Here are some of the firms that have announced layoffs recently:

Impact on the greater economy

According to the May US job statistics, the US added the fewest jobs since the pandemic recovery began, as small businesses shed workers while larger firms added employees. May numbers had a unique insight: companies with fewer than 50 employees lost 91,000 jobs; those with fewer than 20 saw a fourth straight month of losses. The results suggest that the smallest businesses are struggling to compete with bigger ones in attracting and retaining workers amid a historically tight labor market.

The jobs report continues to break patterns and signal while the unemployed have finally decided to reenter the workforce, the troubling economic signs of a pending recession could mean the volatility in the job market is here to stay.

Amid a variety of corporate challenges, from volatile markets, rising inflation, falling revenues, and an elevated risk of a downturn, companies are slowing hiring, and in some cases, are laying off workers.

Startups and publicly traded companies are bracing themselves for waves of cost-cutting and job cuts in the face of challenging market conditions. Ugly layoffs could erupt across the board, warns one investor and industry observer – from publicly traded tech giants to scrambling startups.

As we saw with the trade war and will continue to see with the looming economic downturn, companies are becoming more and more risk-averse about hiring. Companies in all industries and niches are always hiring to fill roles that generate revenues and are digital, and that remains true during the downturn.

Learn more about HatchWorks Sprint Recruiting

Sprint Recruiting was born from the chaos of traditional recruiting. Our process has become more efficient with each iteration, and our engagement with both the business and candidates increased proportionally. Sprint Recruiting guides our journey to iterative growth as we continue to innovate, iterate, and accelerate from Sprint to Sprint.

Talk to HatchWorks today to see how we can help you build the team you need to deliver your next software development project.