The tech industry is going through some challenging changes — but the workforce that makes it through the hardships to the other side may be a stronger, more diverse one.
As of July, more than 32,000 tech sector workers in the U.S. have been laid off in mass job cuts this year, according to recent data from Crunchbase. Companies that have considerably trimmed their headcounts include Netflix, Glossier and Robinhood.
"As we saw in the spring of 2020, some sectors and companies are pausing to take stock of the current market trends," says Jeffrey Spector, co-founder and president at interviewing company Karat. "At the time, the hardest-hit industries were in-person retail and travel. Today, it's the industries that are sensitive to market prices, trading volumes and interest rates that are taking a hit."
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Despite the market turbulence affecting the lives of thousands of individuals, there is a potential silver lining to layoffs, should companies choose to reach for it, Spector says. A slow-down in hiring, he explains, creates an opportunity to revamp hiring processes for the future, and double down on diversity and inclusion efforts.
"Traditionally, the interview and hiring process for tech workers has not been inclusive, leading to an industry that does not accurately represent the world outside of tech," Spector says. "But more problematic is that it has set up a system that is structurally biased against certain populations."
A recent survey conducted by Karat and the Harris Poll revealed that only 48% of engineering leaders strongly agree with the statement that diversity, equity and inclusion is a strategic priority for their company. The need to accelerate the goal of delivering fair, unbiased interviews that will generate more opportunities for candidates from underrepresented backgrounds is significant, according to Spector.
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"For companies, this is the time to build your systems correctly, more inclusively and establish long-term relationships with your candidates," he says. "Improving your own internal systems now will enable you to be ready to hit the ground running when the market inevitably shifts again."
A strong and consistent focus on DEI has typically been the first thing to get scrapped at many companies when the market experiences turbulence, Spector says, especially at tech companies, where the number of Black software engineers in the U.S has hovered at 5% for years, according to the Karat and Harris Poll data.
"These are the times when hiring inclusively matters the most to underrepresented talent — what is good for DEI is also good for overall hiring efficiency," he says. "Right now, the organizations that are able to invest in building a more intentional and inclusive hiring process are going to have a huge competitive advantage as we emerge from the current market disruption."
