#BestofFSCBlog : Over 18K Reads. Must REad- Whether It’s The Notable Silicon Valley Bank, Meta Or Google, Your Job Isn’t Safe—It’s Time To Look After Yourself.
The economy has become too volatile, and workers are no longer safe. The lurching back and forth from good to bad times has accelerated, causing workers to feel lost and confused. Only a year or so ago, everything seemed fine. Record inflation, high-interest rates and soaring costs are eating into everyone’s paychecks. Jobs for white-collar workers were seemingly ubiquitous, but now switching jobs is harder. The tech sector alone laid off nearly 130,00 workers in the first two and a half months of 2023.
Americans are contending with fear, uncertainty and doom. It looks like perpetual change will be the new norm for the near term. You’re not guaranteed job security even if you work at notable firms, like the once highly regarded Silicon Valley Bank, Meta, Microsoft, Amazon or Google. The reality is that this new economy is harsh, cold and unforgiving. You must take ownership of your career and create your destiny. You cannot solely rely upon the largesse of your company.
After many years of catering and pampering tech workers, tech firms are implementing cost-cutting initiatives. The change in tone is voiced by venture capitalist Keith Rabois, a general partner at Founders Fund, known for his big wins in investing in PayPal, LinkedIn and Square at early-stage investment rounds, said that the tech sector has too much “fake work” and too many people were hired as a “vanity metric” to help managers build their egos and fiefdoms.
Silicon Valley Bank Was Shut Down
On Thursday, SVB, the 16th largest bank in the United States, experienced a run on the bank, as depositors rushed to withdraw $42 billion from their accounts, leading to the largest U.S. banking failure since the financial crisis. The lender was best known for servicing the “innovative economy landscape.” According to its website, about 50% of all U.S. venture-backed technology and life-sciences companies banked with SVB.
The VC and tech depositors held accounts with millions of dollars. The Federal Deposit Insurance Corporation, the United States government entity responsible for insuring deposits, only covers up to $250,000. More than 90% of the money held at SVB was greater than the amount the FDIC would cover. Startup founders worried about how they would be able to meet payroll. If the funds were stuck in limbo, it would have likely caused large job losses, as companies wouldn’t have the assets to pay them.
Depositors who held money in SVB, Signature Bank, First Republic and other smaller or regional banks spent the weekend worried about losing their funds. It was a roller coaster ride, as U.S. Secretary of the Treasury Janet Yellen initially said she wouldn’t bail out SVB and other similarly situated banks. Strong protests were made by venture David Sacks and others, asserting that it wasn’t fair for customers to be wiped out of millions of dollars, due to bad decisions made by the leadership at SVB. Ultimately, Yellen, the Federal Reserve Bank and others in the Biden administration ensured that depositors would be made whole again and would have access to their money on Monday.
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Lessons Learned From The Near Disaster
One of the lessons learned from the pendulum swinging to extremes is that you cannot be complacent and must always be vigilant about your job and career. The days of the Great Resignation, quiet quitting and acting your wage are behind us. There’s no room for Bare Minimum Monday and Try-Less Tuesday. The new normal is more akin to FUD—fear, uncertainty and doom.
It sounds dramatic, but it’s meant to be a new reality check. If you have a job, hold on tightly and make yourself irreplaceable. At the same time, you need to cushion your career by creating an action plan to prepare for if things take a terrible turn at your current company. The onslaught of layoffs, hiring freezes and job offers rescinded calls for action, instead of waiting for the ax to fall. Keep looking for new opportunities. Update your résumé. Stay in touch with recruiters. Seek help and advice from mentors, sponsors, career coaches and trusted friends and family. Continue learning new skills as the economy constantly changes and evolves, so you won’t get left behind. If you haven’t started, build a network of like-minded people. These will be the ones to turn to for job leads and introductions to new opportunities. If you have the time and inclination, find ways to have multiple income streams in addition to your job.
Think of what happened over the last three-plus years. We staggered from the depths of despair, slowly digging our way out of a global pandemic. For a time, the U.S. economy experienced a period of exuberance. After millions of layoffs during the early dark days of the pandemic, the U.S. economy experienced a job boom with record-low levels of unemployment. Now, Americans are facing tough times again
Layoffs And Stress
Finding a white-collar job will be more challenging now. Blue-collar and frontline jobs are seeing more growth. However, there is a white-collar recession happening, as thousands of tech, Wall Street, real estate, media and other interest-rate sensitive sectors collectively laid off hundreds of thousands of college-educated office workers.
According to data from LinkedIn’s State of the Labor Market, the market for these professionals is slowing down. The report conducted by the professional social network shows hiring on LinkedIn dropped by 23% year-over-year in the U.S. in January.
The data shows that the number of posts by members mentioning the words “layoff” or “retrenchment” on LinkedIn soared. Posts referencing “open to work” increased by almost 20%. These indicators reflect that the labor market is cooling, beyond the ongoing layoff announcements from industries that saw massive overhiring during the pandemic
Job seekers no longer have the luxury of picking and choosing from a large array of opportunities. If you switch roles, you may be the last person hired and first one fired when things take a turn for the worse. As a result, people are working harder and longer hours, especially since inflation and higher interest rates have increased the costs of everything. Losing a job can become a financial hardship.
Many Americans are financially squeezed, sandwiched between caring for their children and young adults, while also providing for their aging parents. As life expectancy continues to rise and many young adults grapple with financial autonomy, 23% of adults in the U.S. are now part of what is being called the “sandwich generation,” according to a Pew Research Center survey. The sandwich generation consists of adults with a parent 65 years or older, who are raising a minor or providing for an adult child.
Working Weekends
According to a report by ActivTrak, a workplace software company, people are working more hours over the weekend. In the beleaguered tech sector, reeling from an unrelenting stream of layoff announcements, the amount of time put in on Saturdays and Sundays soared by 31%. Job cuts have also impacted media company employees, and the study shows that they’ve put in 53% extra hours on average on weekends.
According to the study, the additional hours spent working are primarily due to the layoffs, which result in the remaining workers having to take on the workload of those who were let go.
The American Psychological Association says that a stressful workplace leads to a multitude of health problems, including headaches, stomachaches, trouble sleeping, losing your temper and lashing out and trouble concentrating. Unrelenting stress can also cause anxiety, insomnia and high blood pressure, weakening your immune system. When you’re burned out, there’s a risk of depression, obesity and heart disease. People in this situation sometimes turn to drugs and alcohol, which worsens the situation.
Here’s What You’re Dealing With
A new policy will make it harder for Googlers to advance within the organization. Google informed its employees that fewer people would be offered promotions to senior levels this year compared to the prior years “to ensure that the number of Googlers in more senior and leadership roles grows in proportion to the growth of the company.”
With fewer promotions available, the tech company is actually pitting people against each other. If they don’t aggressively exceed their manager’s expectations, there may not be a path forward within the company. The new program is another blow to workers shortly after the search giant coldly laid off 12,000 people via email.
Meta CEO Mark Zuckerberg pointed out the proliferation of managers within his company, claiming it creates unnecessary bloat and spiraling costs. According to reporting by the Verge, Meta is making 2023 the “year of efficiency.”
Zuckerberg called out the inefficiencies within the large social media platform, which is also happening at other large tech companies, stating, “I don’t think you want a management structure that’s just managers managing managers, managing managers, managing managers, managing the people who are doing the work.”
Under the cloak of the Silicon Valley implosion, Zuckerberg is reportedly conducting a second round of layoffs that could match the breadth of last year’s job cuts, according to the Wall Street Journal. Every time a company, including his own, announces large-scale layoffs, the company’s stock price jumps higher.
