You have probably noticed that the market for much of the Tech workers has collapsed faster than IBM’s BlueMix brand. During the current recession, bordering on depression, we are offered 2 worlds, one world where it seems scary but the talking heads tell us it’s ‘fine’, we are in a ‘V’ shape recovery and companies are making more money than ever – examples like Amazon, Netflix, Zoom, Grainger, Chewy, GrubHub, etc. It’s a world where the Federal Government is printing money faster than ever before (thus hiding taxing you faster than ever before) and giving money away for free. The Second world, the one that all of us want to ignore, is where the danger lurks. This world features many industries that are crushed by Corona like Hyatt, Walgreens, Wells Fargo, AT&T, Mercedes, United, Lyft, etc. This world has significant drops in the number of projects (thus jobs), rampant unemployment, and extreme uncertainty.
Both of these worlds are one and the same and many companies are somewhere in the middle of the two scenarios. In either case if half of the tech industry is depressed, it has a huge effect on the tech market. The helicopter drop of free money is helping us avoid an outright depression, but the drop in projects and jobs is crushing compensation (some estimates are that it dropped 50% at one point). But what does the future hold? Until sometime in 2021, the tech world will continue on its ‘slow-roll’, some benefiting, others getting by, and some losing. In general no one wants to risk investing with so much uncertainty. So don’t expect a V shaped rebound, but do expect a slight bump as we near the 4th quarter. Big companies must spend unused budget money or risk losing that budget money next year.
A reasonable assumption is that sometime in 2021, the full tech market we all love will start to go back to normal. Large bumps in contractor projects will signal a market reboot as companies need to jump start projects and are still risk adverse to full time hires. With a reduction in uncertainty, those back-burnered critical projects will become relevant again. In the meantime, companies will continue to scale back projects, lowball compensation, and it’s going to be a really tough period. The best advice is to get any job or keep your existing job until 2021 and as soon as the storm passes reevaluate your position.