Tech workers are worried about their jobs, especially in San Francisco. And those worries may be a key factor in the tug-of-war between employees who want to keep working remotely, and tech companies who want them back in the office.
Most American workers (53%) are more concerned about their job security than they were a year ago, according to a new poll of 7,000 by the professional social network Blind. But job fears are reaching a new level here.
In the national poll, five of the top 10 companies in the country where employees are concerned about their job security are San Francisco tech companies: Twitter (91%), Robinhood (90%), Instacart (90%), Coinbase (83%) and Docusign (79%).
There’s reason for their concern.
More than 10,000 Bay Area tech workers, many of them working remotely for fast-growing young companies, have been laid off so far this year. But there’s a paradox to the jobs market, and that’s where things get interesting.
Larger and more stable companies are hiring tech workers – but many of those jobs require a return to the office, at least part-time. So that begs a question:
Will layoff fears end the remote work era?
Many workers say they are more productive and focused when working from home and don’t have to waste time commuting. On the other hand, employers believe workers collaborate better in person, which has been backed up by recent research. Up until now, a talent gap in tech has given an advantage to in-demand workers, who have for the most part held onto remote work adopted during the early days of COVID.
But economic downturns are important because of the impact they have on people, not just bottom lines or stock prices. And that impact is often fear. An old adage says when your neighbor loses their job, it’s a downturn. When you lose yours, it’s a recession.
In 2008-2009, when many laid-off workers needed a side hustle to pay their bills, the gig economy was born. All kinds of people began cobbling together portfolio careers. People found new ways to work.
In this budding recession, laid-off workers competing for fewer and fewer jobs may find an old way to work, economists believe. They may go back to the office.
“A recession will make the job market much more problematic, and people will want facetime in order to keep those jobs,” says longtime Bay Area economist Ken Rosen, the chairman of the Fisher Center for Real Estate & Urban Economics at the Haas School of Business at UC Berkeley. “I’ve talked to a number of companies and they all say the first people they’re going to lay off are people they don’t know.”
And those workers may find their new job prospects are much less remote-work friendly.
A prime example in this conflict played out on Tuesday, as Robinhood, a remote-first financial tech company with executive offices in Menlo Park, laid off nearly a quarter of its staff, more than 800 employees. (Note that Robinhood was near the top of the list of companies where employees, who were polled in June, were concerned about their jobs.)
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Laid-off employees flocked to social media to post about their job losses – a sad trend of the summer of 2022 – and were met with support from peers. A software developer laid off by Robinhood posted “any referral would be helpful.” He heard from employees whose companies are hiring, including Apple, Microsoft, Adobe, MasterCard and Citibank.
At all of those big, stable companies, employees have been asked to return to the office at least part-time. That didn’t always go well.
“Stop trying to control how often you can see us in the office,” the group Apple Together said in a May letter to company executives that has been signed by more than 1,400 current and former Apple employees. “Office-bound work is a technology from the last century,” the employees wrote.
Apple relented on its policy that employees come into work three times a week after staff pushed back. But that was in May, before most of the layoffs, and before tech job openings began to dwindle. While there are still job openings at big companies in the Bay Area, they are quickly slipping away.
Over the past three months, job postings in the software development sector have fallen around 30% nationwide, more than any other sector, according to the jobs-tracker Indeed. In the Bay Area, overall job postings have fallen about 11% over that three-month span.
And tech jobs could have a major impact on the nation, an Indeed economist says.
“The recent fortunes of tech jobs could serve as a guide for the near-term outlook for the overall economy,” Nick Bunker, an Indeed research director wrote in a recent jobs report.
If a recession sets in, remote work may become much less common, economists believe.
Rosen, the longtime UC Berkeley expert, believes only 10%-15% of jobs will end up being remote. “People are going to realize that the old business model had big benefits. People will come back. Maybe they’ll only be in three days, but they’ll be back.”
San Francisco’s chief economist Ted Egan believes the current shakeup follows previous patterns of tech workers flowing from big companies to startups in good economic times, and from startups to big companies in bad economic times. In the bad times, workers lose leverage, he says.
“A cooler labor market is certainly going to take away options for employees,” Egan says. “If you’re a company that didn’t like work-from-home and you were only doing it for your employees’ benefit, now it’s time to worry less about benefiting your employees.”
Layoff fears may seem irrational, but economic downturns feel different when they affect you.
“Why are tech workers so fearful of layoffs?” an Amazon technical account manager asked on Blind on Thursday. (Blind verifies where someone works with their work email address, but users remain anonymous.) “Why is it highly paid people in the tech industry are so neurotic about it?” the Amazon worker asked.
“The emotional impact of being laid off is a lot,” replied a Redfin employee. “It’s embarrassing and painful. There’s also no guarantee you’ll find another job.”
