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How Will Tech Jobs Change in 2023?

Engineers remain in high demand, remote work is here to stay, and the best jobs might not be at FAANG companies anymore. Other than that, this year promises uncertainty.
Jan 10th, 2023 6:00am by and
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After nearly three years of Covid-fueled disruption in the supply chain and the way we work, some new truths have emerged for tech workers and the people who employ them. Among those truths: Remote work is here to stay.

The past year brought a new kind of global threat: war in Europe. In addition to the humanitarian crisis, the Russian invasion of Ukraine disrupted a major source of developer talent and has helped push the global economy into a period of uncertainty.

Yet tech workers, despite recent high-profile layoffs at tech giants, still hold the upper hand overall. It’s still a knowledge economy, will be for the foreseeable future — and people who understand Python and Rust and cloud computing still hold the knowledge.

There are still far more open positions than people to fill them: in the U.S. alone, about 375,000 tech jobs remain open. And the year-end jobs report by Dice, an online career marketplace for technologists, found that job listings were up 25% from January through October, over the same period in 2021.

It’s just that, in 2023, the greatest opportunities may not lie exclusively in the FAANG companies anymore, but in more traditional industries that are upgrading their legacy stacks and embracing cloud native.

It will also likely come from startups, especially fledgling companies founded by former employees of Amazon, Meta, Salesforce, Twitter and other hoarders of tech talent. Some of the hot innovations of 2022, such as Open AI’s ChatGPT, are likely to inspire their own ecosystems full of related tools, and the companies that make them.

“There’s a lot of investment firms that are still bullish about the startup space, and where they can be investing,” said Lindsay Grenawalt, chief people officer at Cockroach Labs, which raised $278 million in Series F funding at the end of 2021. “That’s what I’m excited about, opportunities come up in new technology companies.”

She added, “And when that does happen, these businesses are going to continue to be looking for amazing talent.”

Here’s how 2023 is shaping up for tech workers and the people who want to hire and retain them.

Breaking FAANG’s Grip on Tech Talent

November saw at least 100,000 tech workers laid off from high-profile tech firms. While the rapid hiring and growth of the last 18 months had to end sometime, the scale and speed of the layoffs came as a blow to the industry, but that doesn’t mean it has to be negative for the tech-backed economy as a whole.

Glass half full, many of the companies that made these cuts still have net staff gains. For instance, Meta doubled its staff over the last three years, and has only pulled back 13%. It’s more about what it symbolizes for the seemingly invincible tech giants.

“It is not just layoffs. It is layoffs for a set of people and for a set of firms where I think people thought it couldn’t happen to them,” Mihir Desai, co-host of the After Hours podcast, said on a recent episode.

It will be interesting in 2023 to see what happens when tech talent won’t be so concentrated at Meta/Facebook, Amazon, Apple, Netflix and Alphabet/Google.

Charlotte Howard, executive editor for The Economist, predicts this could be an opportunity for more traditional, blue-chip companies that have always had to compete against these former FAANGs. Now companies like Caterpillar, Hilton, or Procter & Gamble can be more competitive in attracting IT talent.

This may also be because, while tech saw cutbacks over the past quarter, some industries — hospitality, health care, government, and construction — still saw job growth.

As a sample of what’s out there, here’s a list of the top 10 U.S. employers by tech job postings in November, from a new report by CompTIA:

Corporate giants like Caterpillar and John Deere, for instance, need software developers and engineers in part because their longtime IT staffs are retiring, according to Pramad Nallari, global director for systems and software practice at Actalent, which hires engineers to work as consultants at companies including the aeronautic, automotive, construction and fuel industries. (In fact, 2022 was a year when data showed that the accelerating pace of baby boomer retirements is a key reason for staffing shortages in a number of industries.)

But there’s another reason why demand for talent in traditional industries is high, he told The New Stack: More companies have adopted common technologies, rather than relying on the bespoke legacy stacks they once relied upon.

“Ten, 15 years ago, a lot of the automotive electronics, space, oil and gas and heavy equipment companies built electronics into their products that were based on C, for example, or native C, and then native C++ applications,” said Nallari. “And with the computational power that we have available today, we can migrate to much more efficient, higher powerful languages or platforms, like from Java, for example: easy to build, more descriptive, visual-type programming languages.

“A lot of our customers or clients that we work with in these traditional industries are asking for that. They're saying, ‘Hey, I want to be on the cutting edge of technology. I want to leverage what's out there. Can you help us migrate from our older platforms, to this newer technology?’”

As a result, he said, many hiring managers are looking for the same type of people, which drives up demand, and the talent pool is very small. The demand for talent is going to still continue to be high — which means, it's going to be a seller's market.”

Tech Workers Still Have Power — for Now

Though tech workers have had unprecedented influence over their employers in recent years, the power pendulum is showing signs of shifting back.

But not quickly.

The hiring frenzy of the pandemic period juiced salaries. Recruiters who spoke to The New Stack said they’re seeing signs of a correction in compensation. But technologists still expect to be paid generously: Hired’s 2022 tech salary report found nearly 90% of participants would start looking for a new job if denied a raise in the next six months.

During the past two years, scaleups and the Great Resignation fueled fast hiring, and put power into job candidates’ hands. “It was kind of like, Hey, can you spell the word ‘code’? OK, we'll hire you,” joked Taylor Desseyn, managing director, global solutions technology practice leader at the tech recruiting company Vaco.

But now he sees employers pickier, as they were pre-pandemic — and there’s a danger of them becoming too picky. Some aspects of pandemic-era hiring are worth keeping, he suggested.

“We saw a lot of candidates getting off the market super quick,” Desseyn said. “I want to caution employers: go back a little bit to what we were doing during Covid. Where it's like, ‘Hey, you're 60% of the way there, we can teach the 40%.’”

The downside of being picky, he said, is low retention. “If you're gonna bring somebody in that 90% of the skills, and they learn that 10%, in a year they're gonna bounce.”

The pendulum swing also could have an impact on how employers choose to be engaged ethically and socially.

“Born out of my conversations with different executives saying we just don’t want to be out there on social issues the way that we used to be,” Howard said on the same After Hours podcast episode.

“I want to caution employers: go back a little bit to what we were doing during Covid. Where it's like, ‘Hey, you're 60% of the way there, we can teach the 40%.’”

—Taylor Desseyn, managing director, global solutions technology practice leader, Vaco

“The demand for employees remains but I think companies are going to start being more reluctant to meet those demands, both because of the shifting demands in the labor market and the shifting dynamics within politics.”

Of course, it could work out positively in the other direction. Both in terms of technical prowess and ethical demands, Mihir argued that “maybe the cultural transformation of traditional businesses, with this reallocation of talent, is going to be just as important as the migration of pure technological talent.”

Hybrid Work or Return-to-Office?

Another reason recent college grads who did much of their degree online could be looking outside Big Tech is that they wouldn’t want to work in an office — something the hottest tech companies keep trying to make happen.

Following a layoff of 20% of its staff in August, Snap went suddenly from “default remote” at the end of November, to a mandatory four days a week in the office. As Gergely Orosz reminded in a recent issue of The Pragmatic Engineer, Microsoft and Google tried this in February and March, respectively, but then indefinitely delayed these changes.

Apple did get people back in the office three days a week and, while none of us are really sure what’s happening at Twitter, Elon Musk did try to move it from remote-first to office-only five days a week. And these are just a few of the more than 20 big names Orosz has found attempting to force a return to the office.

This is not in tune with what workers want. Even a 2019 poll found 83% of workers said flexible work options would help them decide between two job offers. A December LinkedIn poll found that more than half of 32,000 respondents would turn down a job offer if a company didn’t allow remote work. Remote’s 2022 study found a whopping 76% of workers want flexible work.

“There has been some chatter that big tech is kind of looking at Elon to see what he does,” said Desseyn. Some CEOs are noticing with approval how Musk is cutting perks and frills at Twitter, and getting away with it, at least so far.

“When a company says ‘hybrid’ they mean they aren’t going to have it as what it was before, but they might not have figured out how the future is going to look like.”

— Pilar Orti, founder and director, Virtual not Distant

It could indicate a pivot, Desseyn suggested, to an ethos that is “a little bit of like the old school Silicon Valley: It's gonna be a bunch of guys and girls in a garage, just churning out code. There's been some argument lately that big tech is basically adult daycare.”

And yet, that employer sentiment must contend with the popularity of flexible work. For example, check out the data from the world’s largest test of the four-day work week — cutting one-fifth time, not pay — which came out with astounding 90-day results:

  • 86% want to continue
  • 49% saw an increase in productivity
  • 46% saw the same output

Now the U.K. joins other countries in offering a right to request flexible work. Any multinational is going to have trouble retaining employees if they are treated so differently depending on where they live. Not to mention we are lung-deep in a tridemic, so forcing folks to return to office can be viewed as ableist (Twitter is getting sued already), anti-parent, and contributing to a mass-disabling event.

This continued desire for flexible work options doesn’t mean that companies know how to deal.

In 2023, people could actually start understanding what hybrid means, said Pilar Orti, director of Virtual not Distant, which offers training for managers of remote teams.

“All it means is you are not all day in the office,” Orti told The New Stack. “Doesn’t tell you anything about the culture,” including if it embraces flexibility and autonomy or is still very office-based.

Right now, Orti thinks most companies are throwing the word “hybrid” around to mean the separation of when you want to be social at the office, and when you want to really focus at home.

Jānis Dirveiks, an Agile coach, has found flexiwork red flags in job descriptions where companies want to rank for terms like remote and hybrid, but don’t offer the culture to back it up.

These tags only refer to physical location, Orti agreed. “What’s not quite there is the schedule flexibility. Most organizations are still hung up that certain things can only be done when you’re together, whether in the same space or online.”

This uncertainty will only emphasize the tension and divide she witnesses in larger organizations between who can work from home and who cannot.

For that necessary next level of asynchronous collaboration, 2023 will still be a time of transition. “When I think of remote, I think of location and time agnostic but a lot of these jobs have fixed schedules. They don’t adopt asynchronous practices, [and] still have an explicit or implicit fixed schedule,” Orti said. This can only be achieved by embracing written, asynchronous communication.

Flexible work is a known enabler of diversity and inclusion, which must include not just traditional measures of diversity but embracing different working and thinking styles, as well as part-time work and job sharing.

Minorities Are the First Fired … Again

One of our 2023 predictions for the tech industry is, sadly, that the economic downturn and tech layoffs are going to affect those most minoritized by the tech industry first.

We are already seeing that Black Americans have a higher rate of new unemployment, and the gender pay gap in tech persists, even broadening over the last three years. In general, people of color are more likely to be fired during an economic downturn.

“All the layoffs are coming and we’re the first ones to go,” observed Michelle Levesley, a security awareness lead. “Anyone who is not a white, straight, able man. Black women, those with disabilities, people of color, they are also the least advantaged in all these hiring threads.”

And it’s not just the jobs themselves. When headline cuts like that at Twitter happened, Levesley said she sees, “The support automatically goes to white men and white women.”

This backlash against minority hires has her predicting that tech workers from marginalized groups will move away from household-name employers and start moving to lesser-known companies or building their own.

In the meantime, as companies head more into survival mode, there’s fear that ethics and diversity budgets will be the next cut — something that Twitter is already ahead of the trend. We are also witnessing an increase in job cuts among those that work to help make tech more accessible and inclusive, including accessibility designers and developers.

Dare to Care (for Yourself and Your Teams) in 2023

We can just hope that both tech companies and tech workers try to be more caring next year, something that doesn’t even have to cost a thing.

“We are in an increasingly unstable world, and a lot of workplaces don’t reflect that globally,” Levesley said, before recalling an international all-hands online meeting last week that saw folks in the U.K. wearing winter coats at their home offices. “You can’t actually type because your hands are cold and yet you’re in a good job. I think that’ll be affecting people.”

It’s up to managers, she argues, to check in on teammates and to make space for them, especially when more will be dealing with post-Covid brain fog and other long-term challenges that may mean more doctor visits.

"We’re supposed to carry on and have business trips and have meetings and plan for things and it’s a very uncertain world,” she reiterated. “We are using tech in the real world. We are living through this really strange period of time. The last few years are a blur.”

This is the opposite, Levesley says, of this push to “get people in the office so you can pay the rent and have some control over them.”

Individual tech workers need to prioritize self-care, too. And be tactical about both your finances and next job move.

“I think people are going to be a lot slower to resign from their positions since most people are aware that companies are quick to do layoffs currently,” Lucas Casarez, host of the Techie Personal Finance Bootcamp Podcast, told The New Stack. “Unfortunately, I expect layoffs to continue and job freezes to occur in the middle of applicants' interview process, which means longer employment gaps than some people are used to.

By the end of 2023, he said, “is when hopefully we’ll start to see layoffs no longer making the regular weekly news.”

In the meantime, Casarez offered tips — some, he acknowledged, can be pretty painful — for how to prepare for 2023’s tech job uncertainty.

“Know where your money is going. You may find out that you don’t necessarily have to cut back yet, but it will be easy to find the fluffy part of your spending if you were laid off and needed to cut back on some of your spending in the near future,” he said.

"We’re supposed to carry on and have business trips and have meetings and plan for things and it’s a very uncertain world ... We are living through this really strange period of time. The last few years are a blur.”

— Michelle Levesley, security awareness lead

It’s better to be prepared than blindsided. Then, Casarez recommended, “Evaluate your emergency savings against the expenses you found in your budget exercise. Divide your savings by the amount of your expenses and this will give you your runway of funds before things get really nasty and you will have to start tapping other resources like investments or going into debt.”

As interest rates go up, he says, keep an eye on your different kinds of debt. Aggressively paying off your credit card bills will not only lower end costs, but it will also free up funds in case of emergency. On the other hand, don’t try to pay off your car loans and mortgage, if you don’t have any savings, he says.

“The problem with a mortgage and auto loans is that they are fixed loans and there is no way to get those funds back in cases of emergency,” he said. “They also tend to have lower interest rates so it’s not too painful to pay them at their normal payments.”

Tips for Job Seeking in 2023

So how does a job seeker approach the coming year’s hiring market? If you’ve got three to five years under your belt in working with cloud native technologies and distributed systems, said Nallari, who hires these skill sets for Actalent’s systems and software practice, opportunities should be plentiful.

“That mid-level engineer, that individual contributor type role, that's extremely in demand,” he said. More early career technologists, he suggested, should seek experience in a wide range of industries, languages like Python, and tools, “to put you into that hot market bucket.”

The “open source, polyglot engineer,” one who knows Python, Ruby and PHP, remains in highest demand, Desseyn said, along with emerging interest in candidates with Rust, Go and Kotlin skills.

“If you're a candidate looking at a company, you will want to start asking different questions than just beyond what is the role that I'm interviewing for.”

— Lindsay Grenawalt, chief people officer, Cockroach Labs

The uncertain economy means that job seekers should also ask more questions of potential employers about the business side of an organization, not just about their tech stack.

“If you're a candidate looking at a company, you will want to start asking different questions than just beyond what is the role that I'm interviewing for,” said Grenawalt of Cockroach Labs.

Among the questions, she suggested: “What is the business structure? Where are you deploying your capital? Where are you investing your resources? And what does that runway look like — if you need to have runway for another two years, do you have that in place?”

And if you’re one of the unlucky who got laid off in 2022, Desseyn recommended that you take a moment to breathe. And then get on the phone and nurture your network.

It’s easier than you think, he said.

“People think they have to have this super long dialogue,” he said. And, Desseyn added, “a lot of people think they have to ask for something.”

Keep it simple, he advised, and make it about the person on the other end of the line. “Just be like, ‘Hey, listen, I got laid off. If there's anything that pops up in your network, I'd love for you to remember me. But I also just want to reach out because to be honest with you, I'm just trying to network and it's been a minute since I've talked to you and it was really good to talk to you.’”

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TNS owner Insight Partners is an investor in: The New Stack.
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