On today’s Business Beat, Jeff cites a cnbc.com report that tech hiring is cooling and how startups can benefit.
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Good morning, Paul!
The job market for tech workers remains hot, but is starting to show signs of cooling off. As we know, tech as a category in general is struggling these days as stocks slump and economic uncertainty takes its toll and in today’s world of startups and fast growth companies, tech workers are simply essential.
Now Susan Caminiti reports on cnbc.com that even red-hot companies like Spotify are cooling their hiring as CEO Daniel Ek sent an email to employees explaining that the company is slowing hiring by 25% and crypto exchange behemoth Coinbase announced it was cutting 18% of its workforce.
Caminiti goes on to report the following: “An increasing number of tech companies have announced hiring freezes, slowdowns or outright layoffs in just recent days and weeks. Even so, demand for tech talent remains generally strong with U.S. employers posting 1.1 million tech job openings in the first quarter of this year. That’s up roughly 50% over the same quarter last year.”
“Experts expect to see less cash and more equity in compensation packages in the offers companies make to prospective tech-oriented employees, especially from startups as these companies look to conserve cash in this difficult economy.”
So, Paul, this is an interesting moment for small tech companies here in our region, as they compete for that all-important tech talent. Now, one could argue that given the big companies aren’t offering the fat packages that they had been putting in front of top talent prospects leading up to the last couple of. This may be an opportunity for startups in smaller companies to compete more favorably. Of course, the big upside you need to sell these tech workers on if you’re a small business trying to attract that talent, you need to include in your offer equity participation in the startup. And that means that hires you make get to participate in any financial windfall the company may enjoy down the road.
I’m Jeff Sloan, founder and CEO of startupnation.com, and that’s today’s Business Beat on the Great Voice of the Great Lakes, WJR.