Big tech layoffs free up talent for Australia

Sudden mass layoffs at the biggest technology companies on Earth could be an opportunity for Australian organisations to fill long-standing gaps in their workforces.

More than 70,000 employees have been sacked from tech giants in the past year as companies such as Google, Microsoft, and Meta – which saw enormous growth during the pandemic – are now winding back their staffing levels.

Far from being a cause for concern for IT professionals who have long been told their skills are widely needed, Professor Barney Tan, Head of the School of Information Systems and Technology Management at the University of NSW Business School, is confident demand for tech workers will continue to be strong.

“From a longer-term perspective, the fundamentals of the tech sector needing more workers remain sound,” he said.

“This is because we are likely to see the tech talent from these large tech firms move to start-ups, as well as ‘traditional’ businesses that have been struggling to attract tech talent for some time.

“To me, it is not that the market for tech talent is shrinking, but just a period of adjustment where those organisations that were more attractive to tech talents – and which had the resources to hire almost indiscriminately during a period of boom – are now finding that they have to let them go.”

In the US, Silicon Valley analysts have suggested the layoffs are a way of keeping skilled tech workers under control by creating a sense of insecurity that ensures executives are the ones wielding the power.

Elon Musk has provided a public blueprint of sorts for this management style at Twitter where he gutted the workforce, cancelled remote working policies, and has quashed internal dissent.

Publicly, many of the big tech companies facing layoffs have said their expectation was for pandemic-led growth in digital products and services to continue and now they are having to pare back in response to an economic slow down.

Professor Tan said for Australian organisations which have for years been crying out for IT skills, the HR upheaval at North American tech giants could create a unique opportunity.

“The impact on Australia of all this is likely to be minimal because we still have many large businesses that have been crying out for tech talent,” he said.

“If anything, this global development may see a greater availability of tech talent for Australia as the talents displaced from the US, Europe and the UK may now be forced to move.”

Lachlan Feeney, founder and CEO of Queensland-based blockchain development company Labrys, told Information Age the pandemic was an especially difficult period to hire people with tech skills.

“With our borders open to the world once again and the tech sector making mass layoffs – particularly in markets like the United States – it presents more opportunities for Australian businesses to think and look globally in the search for talent,” he said.

“Since the beginning of 2023, we’re receiving the most qualified CVs we’ve ever received, with very senior and accomplished professionals looking for full-time positions.”

Feeney’s business is in an area of technology especially prone to market shocks.

Where technology companies are seeing their share prices drop by less than half, cryptocurrency values have tanked as the sector that saw an unprecedented level of attention during the early phase of the pandemic disappeared nearly overnight.

The local cryptocurrency industry has faced major problems including exchange Swyftx which axed a third of its workforce late last year.

Yet Feeney remains confident that “when the dust settles and the industry begins growing once again, the serious players will remain”.

“Access to tech talent that was once unavailable will help us and the industry drive innovation, and build real solutions that drive genuine value for businesses and industries,” he said.