The Covid-19 pandemic has put the entire world in an extraordinary situation, causing 197,698 deaths worldwide as of April 25, 2020. In this terrifying situation, fears about an oncoming recession followed by a substantial drop in hiring are being raised by the experts. Tech companies have already started pulling back on hiring to survive the negative economic shocks triggered by the outbreak. Before delving deeper into the impact on the tech job market, let’s take a look at how the pandemic has affected global employment.
By the end of 2020, growth in worldwide IT spending is projected to lower by 3-4% due to the pandemic, as per the IDC Worldwide Black Book Live Edition for the month of February 2020. An assessment by the ILO (International Labour Organization) revealed that global unemployment could increase by almost 25 million because of the reduction in GDP growth by almost 8 percent. It’s important to remember that the global financial crisis that occurred during 2008-9 has increased worldwide unemployment by 22 million.
Impact of the pandemic on the tech job market
The below screenshot shows the present impact of Covid-19 on the U.S. tech job market. It’s clear that despite the surge in demand for some specific online services and the shift to remote work, the tech section isn’t able to be immune to the pullback.
It’s true that between the increased necessities of cloud computing, remarkable growth in online grocery shopping, and extreme demand for videoconferencing equipment, some tech organizations have significantly benefitted as more and more people opt for their services as stay-at-home orders remain in effect across the country. However, those are rare opportunities in a job scenario largely frozen.
Job postings have been cut between 30 and 60% by well-established companies like Intel, Dell Technologies, Micron, etc between January 1 and April 15 this year. Over that same period last year, these companies either held listings reasonably steady or increased them.
Opportunities are still there
Despite the negative impacts, some companies are striving to ease the strain on jobseekers and present employees.
Amazon announced last month that it’d hire 100,000 more workers to cope up with the surge in online orders and increase the hourly pay of these workers through April.
Facebook announced that it’d provide its almost 45,000 employees with a $1,000 bonus per head in the near term to offer additional financial assistance.
During the downturn, the tech job market is demonstrating more resilience compared to other industries because here, organizations are staffing up to maintain the infrastructure needed for the massive remote workforces. Companies that provide near-essential or essential tech services are doing relatively better as well and these are the areas where we can expect organizations will continue to recruit.