There's a new acronym in the tech industry: ZIRP.
ZIRP, an abbreviation for “Zero Interest Rate Phenomenon,” has been mentioned frequently among tech employees lately to describe the current disruption in an industry that has long been synonymous with lavish perks, high pay, and stability. As the Federal Reserve began continuing to raise interest rates in 2022 to stave off inflation, companies that had previously given little thought to spending began tightening.
The history of high-tech companies distributing funds is beginning to show signs of anomalies. moonshot The project is a relic of the ZIRP era. As well as complimentary catered meals, day care and laundry services at work. Will he bounce from one mid-six-figure salary to the next at a major tech company?Zip.
CEOs who once focused solely on growth are now focused on efficiency, and technology employees are beginning to realize that the days of ZIRP are over. Over the past 18 months, this efficiency mindset has led to mass layoffs at giant companies like Meta, Amazon, and Google. It also created a level of job insecurity that an entire generation of well-paid, highly educated technology professionals never expected to experience.
“To be honest, sometimes these days I feel like my entire career is a ZIRP,” a technology employee recently reflected. A self-proclaimed straight-A student in high school, he studied computer science in college and joined the technology workforce immediately after graduation. He still holds a lucrative position at a well-known technology company and has worked hard for years to move up the ranks. If everything goes according to plan, he will soon be a millionaire by the age of 30. But never has the plan felt so unreliable. He, along with other identified tech employees Business Insider spoke to, requested anonymity to protect their current tech jobs and future prospects.
“Everyone is looking around and talking about when the next layoffs will happen and at which companies,” the tech worker said.
Six other high-tech workers BI spoke to for this article said they are no longer facing layoffs, especially as phase-outs and “quiet layoffs” through harsh performance reviews and job eliminations continue until 2024. Agreed that it doesn't seem safe. New research from Authority Hacker We found that 90% of people working in the IT services and data sector are concerned about job security.
An industry that coined the phrase “rest and vest” to describe colleagues who remained employed but appeared to be out of work as they waited to cash in their generous grants of restricted stock. This is a big change for me.
“In fact, at a company like Google, of course most people worked hard, but it was also hard to get fired,” says a senior employee who has worked in Big Tech since the 2000s.
More tech workers will be laid off
Over the past 18 months, tech workers say they're finding it hard to keep their jobs after a wave of layoffs at tech companies and across the industry.according to layoff.fyiMore than 38,000 tech workers have already been laid off in 2024, on top of the more than 260,000 laid off last year, according to a site that tracks tech layoffs.
Such layoffs were previously anathema in the modern technology industry. Technology companies have been desperate for years to attract and retain people with technical skills (and increase their headcounts as one way to show Wall Street that their businesses are thriving). High-tech workers, once treated as valuable assets by technology companies, are now treated as a “line.” on a spreadsheet,” said the senior engineer.
The reality is, of course, that it's always been the case for employees at companies everywhere, but the technology industry has long been devoted to making employees feel special about themselves and their work.
Currently, companies such as Google, Amazon, and Microsoft abandoned Many long-term or “moonshot” projects got employees excited about their work and embraced the mission-driven nature of future technology development.
“For nearly 20 years, for people working in the technology industry, our identity has been about what kind of company we are. We wore that gear, and we wore it proudly, not ironically. He was wearing one,” said a senior technical official. “Maybe it was a coincidence at first, but companies found ways to get more out of people because they felt like there was something worth caring about. They had a mission. ”
Tech industry perks disappear
Technology-related perks disappeared first.
When Elon Musk took over Twitter in 2022 after months of trying to avoid it, one of the first things he did was eliminate free food. Meta ultimately discontinued the laundry service it provided at its Menlo Park campus. Google is shutting down its long-standing daycare business for employees. Across industries, the acceptance of working from home ended as quickly as it was introduced at the beginning of the pandemic. These are just some of the perks that have been phased out over the past 18 months.
Technology workers are no longer special.
“Now, if you come to work one day and your badge to the office stops working, you're done,” said the senior tech employee. “Even people who work in the field of AI, across the board, are worried about waking up and not having a job. Even if you're the new hot thing, you're not safe.”
To be sure, many employees at large corporations and well-funded technology businesses are still well-treated by the standards of other white-collar, high-paying industries.
The senior tech worker said her family members who work in the financial industry are in awe of the large paychecks and bonuses, as well as the variety of benefits that big tech companies offer to their employees. Technology companies have long used such benefits to keep employees from pursuing jobs in industries such as finance. This senior tech worker, who received a variety of perks and benefits at his big tech job, consistently rejected recruiters' offers, even temporarily accepting at least 25% below market rate. He said he was fine.
The technology job market has become even tougher.
To add insult to injury, it's not just that keeping a job in the tech industry is more difficult. Obtaining it is more difficult than ever.
Aline Lerner, a former technical engineer and founder of interview.io, a tech recruiting and mock interview site for tech job seekers, currently works as a tech talent at some of the most high-profile and big tech companies. He said it has become much more difficult to get a job in the field.
“At the beginning of 2022, you had to be in the 65th percentile of engineers to get an interview at a top technology company; now you actually need to be in the 83rd percentile,” Lerner said, based on internal data and research. quoting.
The average engineer, regardless of how much experience they have, will need to do a much better job than they did two years ago to find a new role.
And after more than a decade of people flocking to an industry that went from geek haven to mainstream, the tech job market is now virtually swamped with qualified workers. The number of graduates with computer and information science degrees, excluding other STEM fields, has increased rapidly over the past decade, from about 39,000 graduates in 2010 to about 97,000 graduates in 2020. became. Including all his STEM fields, graduates increased from about 487,000 to just under a few. According to data from the Ministry of Education, 800,000 people over the same 10 years.
“Anecdotally, I'd say it's probably the hardest job to get into technology since the dot-com bust,” Lerner said.
The interview process for new jobs in the tech industry has changed since the 2000s. Second, early interviews typically involve candidates reviewing their own proposed problems in real time to see how they think and solve problems. Interviews with LeetCode, a popular site for technical coding interview questions, are now routine with common questions.
This “dehumanizing” hiring and interview process led to a wave of tech workers using ChatGPT, OpenAI's generative AI tool, to cheat in interviews, Lerner said. According to some information, most interviewers did not know when a technical employee passed his LeetCode interview round using ChatGPT. recent research Interview.io conducted this interview.
broken promise
Attrition becomes the new norm, with more people competing for fewer jobs, and during recruitment processes designed to eliminate as many candidates as possible as quickly as possible rather than finding the best person for the job. It's no wonder, then, that there's a growing sense of ennui in the way the tech industry works. class. In less than two years, hundreds of thousands of workers have lost their jobs in an industry that promised stability, wealth, or at least a comfortable upper-class status. That could also be part of the problem.
“It used to be that you were a doctor or a lawyer. That's what parents wanted for their kids,” Lerner said. “Then software became one of the safest jobs for him to become an engineer. It doesn't require as much schooling as a doctor or lawyer.”
An executive at another major tech company who started working with computers in the 1980s said the new generation of high-tech workers “basically came here for the money, to become millionaires,” and that technology He lamented that it was not out of love or genuine interest in him.
Lerner and senior tech workers say that as Big Tech becomes a cooler, more mainstream job industry, people will inevitably end up working for such companies, but that's because it's more difficult to get a job. Now that they are in agreement, you may wonder why. They totally do it.
