As Big Tech cuts workers, other industries are desperate to hire them

Workers who jumped from one high-paying job to another as Big Tech companies staffed up at a dizzying pace in recent years are now considering leaving the sector entirely as those same large employers lay off tens of thousands of workers. MarketWatch spoke with several recently laid-off tech workers who are looking for jobs at companies that dont focus solely on technology many of which say they are still hiring.

Anna Naumova was laid off in January after nearly four years as a contract worker at Apple Inc. AAPL, -0.75%, where she was a product manager of internal sales tools for Apples marketing team. Now shes looking into a nontech job at grocery chain H-E-B, where she would be able to use the same skills.

Its a really hard situation, said Naumova, who also recently started a consulting business to help immigrants land jobs in the U.S.

Todd Erickson, meanwhile, has spent nearly two decades in tech, working for the last six years at Phase Change Software. Now hes exploring marketing and communications openings at nontech companies in sectors like healthcare, government and financial services.

Longtime tech workers like Naumova and Erickson are considering making these kinds of career changes as tech giants like Apple, Meta Platforms Inc. META, +0.26%, Amazon.com Inc. AMZN, -0.97%, Alphabet Inc.s GOOGL, -1.21% GOOG, -1.24% Google, Microsoft Corp. MSFT, -1.56%, Cisco Systems Inc. CSCO, -0.43%, HP Inc. HPQ, -0.36% and Intel Corp. INTC, -2.09% pink-slip thousands of employees in an effort to cut costs. The shift would help explain why the U.S. continues to exceed forecasts for job growth, as Januarys jobs report showed, despite massive tech layoffs.

Silicon Valley added 88,000 jobs in the year ending in June 2022, according to the recently published Silicon Valley Index. More than 16,000 of those jobs were in the tech industry, leaving the regions unemployment rate at about 2%, compared with the national rate of 3.4%.

On Friday, during the annual State of the Valley conference, Joint Venture Silicon Valley CEO Russell Hancock said most local jobs are in infrastructure, and parts of that sector including healthcare, social services and banking and financial services are rebounding and adding jobs. The 11,000 tech layoffs through February amounted to about 0.7% of the total Silicon Valley workforce and 2% of tech workers, he said, noting that 22,000 jobs were added to the region in the second half of 2022.

Another employment wrinkle is placing non-tech workers at pure-tech companies. Ed-tech platform Careerist has helped place 1,000 people in jobs as office workers, drivers, and sales reps at Apple, Amazon, Google, Samsung Electronics 005930, -1.73%, and Intel Corp. INTC, -2.09% over the three years, company CEO Ivan Tsybaev told MarketWatch.

For more: Heres why the jobs report was so good despite Big Tech layoffs

The sudden influx of laid-off workers has not only intensified competition for jobs but has added to harsh feelings among some tech workers toward their employers and the tech industry in general.

The honeymoon period with tech ended five years ago with the tech backlash, 2016 elections, data breaches, federal legislation and antitrust lawsuits, Spencer Greene, a general partner at venture-capital firm TSVC, told MarketWatch. There is a sense of disillusionment.

Stephen Deasy, chief technology officer at Benchling, a biotech-research platform, predicts that many jobless tech workers will land at more traditional businesses, which he says is an invaluable opportunity to transfer their skills.

Industries outside of tech have undergone massive digital transformations and are in need of workers with skills in artificial intelligence, cloud computing and data services, and companies in sectors such as banking, pharmaceuticals, biotech, healthcare and the defense industry are now hiring from a huge pool of newly available talent.

Former Cisco Systems Inc. CSCO, -0.43% CEO John Chambers has repeatedly said Fortune 500 companies have no choice but to adapt or perish. Have of these companies wont exist in 10 years, he famously said in 2020.

For years, those industries struggled to recruit against Big Tech, which offered legendary perks and lofty compensation. But now, industries such finance and insurance are hoping to hire while tech companies are on pause.

Wells Fargo & Co. WFC, +0.57%, for example, is in the midst of a tech-hiring binge. After filling more than 1,000 tech-related job openings in 2022, the financial-services company plans to hire 1,500 additional software engineers, systems architects and people skilled in user-experience design, operations and AI and machine learning. Wells Fargo already employs 40,000 technology workers globally.

It remains hard to recruit and get through to top talent. They are never looking for a job. We have to reach out to them, Jason Strle, chief information officer and head of enterprise-functions technology at Wells Fargo, told MarketWatch.

At the same time, early-stage tech startups are finding it easier to hire from the growing pool of qualified workers who have been let go recently by the industrys biggest names.

Seed-stage startups had difficulty hiring in 2021, but that is freeing up now, TSVCs Greene said. In 2021, there was so much competition for talent. Now it is a question of how much of more than 100,000 [laid-off tech workers] can you absorb now? I dont know, but startup people are really excited about [the available talent pool].

Somesh Dash, a general partner at Silicon Valley VC firm IVP, said 90% of people laid off at his portfolio companies, which include Uber Technologies Inc. UBER, -4.00% and Netflix Inc. NFLX, -0.78%, found jobs within a year.

If there is any consolation for recently unemployed tech workers, its that they are in high demand, as companies like Wells Fargo and State Farm Insurance build out their IT operations and need workers with AI, software and cloud skills.

This has happened before, said Muddu Sudhakar, CEO of Aisera, a service-desk platform. After the dot-com implosion in 2001, nontech employers ramped up hiring of tech talent. Now, we are having it happen again 20 years later.

This time around, there is a twist. Some tech workers are reluctant to take a job at another Big Tech company because of misgivings over companies damaged reputations as well as a general feeling that the industry is more interested in profits and market value than innovation.

Nick Hirsch started out as a software engineer intern at Google and later worked at Amazon and Microsoft before leaving Big Tech in 2015 to start his own venture. He also does freelance work for nontech companies such as McGraw Hill through A.Team, a marketplace for people with tech skills.

He says that his career path reinforces the idea that highly skilled tech workers dont have to be full-time employees at Big Tech firms. Like Hirsch, many have made the choice to do meaningful work at other kinds of companies.

Every company is a tech company to a certain degree, Deasy said. As banks, healthcare and customer service move into the application of AI, [machine learning] and cloud computing, there are more job opportunities than ever. So if you lost a job at a Big Tech company, dont despair. You have options.

Jeremy Owens contributed to this report.

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As Big Tech cuts workers, other industries are desperate to hire them