The job market has seen unprecedented churn of late. Most recently there has been fallout due to the increasing trend of “return to the office” mandates. Then, just when it felt like normality might be around the corner, enter inflation and the stock market devaluation resulting in large numbers of tech lay-offs.

If your business utility is based on technology, it’s essential to understand the effects of the last recession on talent acquisition.

Employees Get Spooked

The global financial crisis of 2008 decimated the banking sector in more ways than one. For almost a decade after Lehman Brothers collapsed, banks and regulated financial services institutions could not attract the most in-demand professionals, especially in tech.

Corruption, poor ethics and dishonesty had become synonymous with the industry, and the only way they could hire tech talent was through expensive temporary contracts—and even that wasn’t easy. 

Skip forward to 2023 and the narrative from highly profitable tech businesses slashing workforces is that they over-hired during the pandemic boom, with CEOs assuming responsibility.

A cognitive bias Daniel Kahneman refers to as WYSIATI (What You See Is All There Is) in his book Thinking, Fast and Slow, is abundant here. He hypothesizes that, when we make decisions, our mind only takes into consideration the things it knows and, regardless of their quality and quantity, the only thing it tries to do with them is to build a coherent story. And that’s enough. The story doesn’t have to be accurate, complete or reliable, it only has to be coherent.

So the tech layoff phenomenon has been interpreted by most people as a story that goes like this: employers who were for so long a poster child of employee well-being and positive culture have become just another corporation, panicking at the first gust of headwinds and laying bare that their employees are, at the end of the day, merely a number.

For the first time since the dot-com bubble, confidence in technology markets is low, talent is spooked, and if they have no concrete employee value proposition, companies are struggling to hire technology professionals.

Something’s Gotta Give…

While profitability is the priority for tech businesses now, flexibility is the priority for talent, and each appears to be moving in opposite directions on the spectrum. This is not sustainable, which means something has to change.

Here’s a common scenario happening today in businesses everywhere: John works for an insurance multinational that recently redefined its hybrid work policy. They require employees to spend two days in the office each week, and one hard day with your immediate team. John’s team must now be in the office every Tuesday. 

This presents a problem for John. His partner is a shift worker in a hospital and can’t control which days she works. With three children between school and daycare, someone must be home to manage pick-ups and drop-offs. With their energy bills and mortgage repayments drastically increasing, they can’t afford to pay for extra help.

 As a result, John can’t commit to being in the office every Tuesday.

How many organizations have the agility to manage this situation and the many other contrasting challenges their employees are facing?

Navigating the Altitude

Moonshot, an Alphabet portfolio company that hires the most in-demand scientific and engineering talent, gives an insight into their people strategy through the job title of their Global Head of Talent, AJ Thomas: he is also called their Chaos Pilot.

According to Nathan Furr in Harvard Business Review, the term is derived from a business school created by Danish politician Uffe Elbæk in 1991. The business school’s vision was inspired by a previous project of Elbæk’s, where he observed a new skill set in students for navigating uncertain problems and saw the opportunity to teach these skills to business leaders who needed to do the same. The fundamental learning is how to innovate your way out of chaos.

On an episode of Redefining HR with Lars Schmidt, AJ discusses being a Chaos Pilot within a people function that has been underwater for two years: “You’re learning all the time, and you’re learning how to swim. And I think also, in this space, it’s essential to learn how to fly.”

Crucial Shift

If 2008 was a financial problem for financial services businesses, 2023 is a people problem for tech companies. 

A successful people strategy has never been more complex and harder to execute. And innovation in this area is vital in order to attract and retain talent.

In short, it's no longer “one-size fits all” when it comes to your employees’ needs and motivations. The question you need to be asking yourself is how scientific you are prepared to become to understand your people better.

More on Hiring and Retention

James Alexander
Founder, Trive Talent

Intrinsic Motivator Report