The Great Resignation, the Great Layoffs, the quiet firings, the quiet hirings, the quiet quitting. Call the current work environment what you will, but at its core, what we’ve got is a Great Reshuffle, where how we work and get compensated may change forever.
What Just Happened?
Around 4 million Americans – or 2.6% of the workforce – quit their jobs in October 2022, according to the WEF. The Pew Foundation cited lack of a forward path, low pay, and disrespect as catalysts for many of these resignations.
For others, like those in the entertainment and media sector, there was simply no work available. According to Ken Kerschbaumer, editor of the industry network association Sports Video Group, “During the pandemic, camera people, producers, graphic producers, and other live sports positions saw that approximately 30% of its workers left simply because live sports and events were on a pandemic moratorium.” And they never came back. “Today, with live events back we have the jobs”, says Kerschbaumer, “but no talent to fill them.” When they are filled”, he adds, “it’s typically with gig workers rather than full-time employees because employers are timid about encroachment by new media and streaming.” Sporting events are just one example of industries hit by the pandemic that are both short on talent and reluctant to hire full-time staff.
The Pandemic Made Tech Workers Seasonal
While other sectors were tendering their resignations, the tech sector was getting layoff notices (often via email or Zoom). The best explanation is that tech compensated for pandemic screentime mania by hiring to staff the heightened demand. The use of tech became a mainline for almost every job during the pandemic. For the tech industry that amounts to a “two-year seasonal hiring” spree. Like Macy’s hiring extra Santas in December. Or Chipotle advertising for 15,000 new workers to staff its “burrito season.”
Now that we’re leaving our screens and a recession is in the picture, many companies are tightening their belts. Sadly, as these companies slash headcounts, their market valuations rise. Redundant positions, teams who’d stopped building, and armies of employees with jobs like masseuses and chefs disappeared. (Google’s perks will soon seem as quaint as three-martini lunches.) Such restructuring happens routinely, but the swiftness, scope, and almost lemming-like behavior of tech companies in recent months is distressing.
LinkedIn has made covering tech layoffs something of its news beat, comparing the cuts to measures we haven’t seen since the dot-com bubble burst. The numbers are significant: 18K at Amazon, 12K at Google, 10K at Microsoft, etc. But there’s a story behind the story. According to the analysts at CB Insights, “these figures are relatively small in comparison to the number of employees hired by these companies over the course of the pandemic. Amazon, for example, hired 746K people during the pandemic, increasing its total headcount by around 93.5% from Q4’19 to Q3’22. In that light, its recently announced layoffs are expected to bring its total headcount down by 1.2%.” While there’s some rightsizing, the net/net is less dramatic than it looks.
Reskilling and Prepping for The Gig Economy
Muhammad Younas’s company VFairs now runs virtual and live events, but it started with virtual job fairs. Younas reports that virtual job fairs grew 50 to 100% year over year, even before the pandemic. Now that the workforce has gone remote and travel budgets have been slashed, companies rely even more heavily on virtual job fairs. Younas, whose company employs 250 people, admits that even he is pivoting to hiring more AI experts. “Microsoft,” he says, “has many job offerings that might require different skills than those they have, in particular, AI”.
Sorting through all the incongruous job activity means you are staring at the face of the Great Reshuffle. An aging workforce has left or will be leaving shortly, the younger generation became more agile about the definition of work, and the balance they’d prefer. Sectors are hiring, but the skill sets are changing. And many businesses would prefer to keep their balance sheets looking good by hiring gig workers rather than salaried/benefit-laden staff.
That is, in a nutshell, the recipe for reshuffling. But many of the ingredients have not yet been kitchen-tested. Empty office buildings, an uninsured population, new educational systems to meet new needs; these are just a few things that need to be reimagined. We are facing a shift that could be as dramatic as the industrial revolution. Ready to shuffle?