By most accounts, the hiring freeze in the technology sector is impacting the current workforce as well as soon-to-be college graduates looking for an opportunity in Silicon Valley. Late last year, Meta CEO Mark Zuckerberg announced massive layoffs at Facebook’s parent company Meta, laying off 13% of its global workforce.
Twitter CEO Elon Musk followed suit by laying off about 50% of the workforce at the social media giant. With about 4,000 employees losing their jobs at Twitter, some of them not even being called back a day later, it’s clear that confusion is sweeping Northern California techies. The trend continued into 2023, with Amazon reportedly relieving nearly 18,000 employees.
As Spotify cuts its workforce by 6% globally, the concern centers on finding an endpoint to the carnage. Daniel Ek, the CEO of Spotify, has publicly communicated the market assumptions that have wrong-footed the Swedish tech giant. “In hindsight, I was too ambitious to invest ahead of our sales growth,” says Ek.
Goodbye posts on LinkedIn have now become commonplace for talent to share incomplete dreams and atonement for alternate, future paths that, admittedly, they never thought they’d have to consider.
Yahoo Finance spoke with Dan Ives, technical analyst and general manager at Wedbush Securities, about the layoff effect in technology. “One person’s loss is another’s gain. Highly skilled developers and software engineers won’t be out of work for long, and the companies that pick them up are likely to be at the forefront of exciting new industries such as artificial intelligence, electric vehicles, cloud storage and cybersecurity. I think it’s a repositioning of technology.”
Wanting to learn more about the next steps in talent acquisition, this reporter spent time with Hudson Brock, CEO and founder of AlloHire, a boutique technology recruiting company based in Chattanooga, Tennessee. Brock shared the current challenges facing the tech industry, quickly touching on the pioneering practices of many who live in Silicon Valley.
“Some of the largest platforms are so focused on their immediate need for growth and expansion that they rarely think about how their frequent and erratic hiring practices may affect the lives of their staff later on. Irregular hiring almost always results in erratic firing processes, which is something that tech companies need to change,” says Brock.
Rod Berger: Before we dive into why the tech industry is so volatile for current and future employees, let’s address your company’s central principle: allocentrism.
Hudson Brock: Allocentrism is the opposite of egocentrism, which in this context is an unhealthy focus on yourself or your company. ‘Allo’ means ‘other’ so allocentrism is in a nutshell’other orientation’ as opposed to egocentrism. Allocentrism in a company will show in a strong focus on employees when it comes to hiring or your clients and customers when it comes to service.
It is building a corporate culture that considers the implications of every business decision for life and the output of the vital relationships the company maintains, such as customers and employees. This is the core principle behind our company, hence the name Allohir.
recovery: Can you tell us a bit about Allohir, its background and how you arrived at allocentrism?
bro: The concept probably came to me from observing how companies worked and years of observing hiring practices on both sides of the table. I founded AlloHire to bring allocentrism to talent acquisition because I noticed so much self-centeredness in the way companies, especially tech companies, hire people. This self-centeredness constantly affects the long-term impact of their hires.
We are a boutique recruitment agency that partners with mission-driven organizations to recruit high-impact people. Over the past two years, we’ve grown this agency from a startup startup in my basement to a multi-million dollar company headquartered in the heart of downtown Chattanooga. Our rapid success is proof that our ideas are catching on.
We partner with more than 30 companies, including industry leaders such as Chick-fil-A, Very, The Optimism Company, Principle Studios, Waypoint TV, Softgiving, and Reliance Partners. We have used our unique relationship-focused strategy to effectively serve both candidates and hiring companies.
recovery: The tech world is experiencing a problematic job freeze. Some argue it’s more like a decline in hiring. How does allocentrism affect this scenario and could it change what many see as inevitable and negative change?
A recent Fortune analyst recently warned that 15% to 20% of Big Tech employees could be laid off in the next six months.” What is your impression of this prediction?
bro: It’s time for the tech industry to start looking forward to the future of hiring and how it needs to change. The mistakes have already been made. For example, Twitter and Meta were heavily criticized in 2020 for their sudden surge in hires; just two years later, they fired almost all of those new hires.
Mark Zuckerberg recently came out to take responsibility for the layoffs. He admitted that the rapid recruitment had been unwise. They had assumed so many people in advance that the frenzied online activity and ad spending of the mid-post-pandemic Covid era would continue, but there was no indication that this would be the case.
When companies view subcontracting as a stopgap solution, it will undoubtedly have a negative impact on productivity in the long run. But if they consider how their hiring decisions today will affect hiring in a few years, they’ll make more conscientious decisions.
Most companies hire people to fill immediate gaps without considering whether those gaps will exist in the foreseeable future and whether their hires are flexible enough to be incorporated into other spaces within the company. They hire people to meet their needs rather than the needs of the candidate, who may also have a goal of accepting the job. The ease with which technology companies transfer staff is one of the causes of the great stagnation in that space today.
recovery: Does this concept of allocentrism also apply to candidates themselves? How would you advise recent graduates looking for their dream job to apply the concept for themselves?
bro: We focus on developing authentic relationships between colleagues and future colleagues. We live in the liminal space of job exploration, poised to serve as personal agents for candidates and hiring managers alike. We first apply the concept of allocentrism to ourselves and our services as an agency and then encourage others to do the same.
Potential employees can apply the same concept by becoming more focused on what the company needs from them. This goes beyond researching the company prior to an interview. It is a mindset that prepares the candidate to benefit the company significantly.
An allocentric mindset is reflected in the way the candidate answers questions, the details he picks up about the company and his understanding of how his strengths come into play to further strengthen the company’s position.
Our approach to candidates and recruiting organizations makes it easier for companies to achieve near-perfect hires because of the other orientation involved in the recruiting process. Our approach to our work makes us a glitch in the recruitment matrix, a long overdue glitch.
Layoffs in the tech space have spread to companies like Airbnb and Roku. Continued reports of budget cuts in 2023 further reinforce the position of pundits like Hudson Brock in their insistence that the hiring system is broken and in need of overhaul.
Time will tell if content aligns with sustainable recruiting practices in Silicon Valley. Hudson believes that prioritizing relationship-building strategies is key to the industry’s long-term investment in human capital. In his words, “Every human being has a reason for being that is maximized by true relationships.”
Interviews have been edited and shortened for clarity.