Four years ago, when today’s college seniors started their studies, technology companies were hiring new graduates as quickly as possible. Job seekers about to earn their diplomas are scrambling to find work amid Silicon Valley’s current economic downturn, which includes thousands of layoffs.
Signs of trouble are easy to spot at the University of California, Berkeley, which is typically a hotbed for hiring engineers.
Some Big Tech companies have ended recruiting and branding partnerships with campus career services offices. It takes time for students to find employment. To make themselves more marketable, some students are doubling down on courses in AI and data engineering, which have not been hit as hard as other areas of the technology industry. Meanwhile, many students are applying for jobs at small and medium-sized companies after tech giants Google, Amazon and Facebook’s parent company Meta have cut tens of thousands of jobs over the past two years.
“Students are frustrated,” Santina Pitcher, senior associate director of employer relations at the University of California, Berkeley’s Career Center, told Fortune.
Anxiety among job seekers is spreading across the country. Once a sponge for hiring new graduates, the tech industry is hiring fewer and more selective jobs for high-paying jobs.
Tech companies have laid off about 140,000 employees so far this year, according to Layoffs.fyi, a website that tracks layoffs. That’s more than 264,000 jobs cut in the technology industry last year.
Things don’t necessarily get better for college graduates right away. Silicon Valley is increasingly using artificial intelligence to speed up the process by which software engineers write code, reducing the need to hire more programmers.
In a potential sign of change, the number of software engineer jobs has fallen by more than 160% since post-pandemic hiring peaked in March 2022, according to data from online jobs site Indeed. This is a much larger decline than for non-technical jobs.
In response to the market downturn, young professionals are seeking technical jobs outside of the usual candidates, such as in small businesses and government, according to new data from Handshake, a college job site. We found that 42% of current computer science students are applying for full-time jobs at small businesses, up from about 25% in 2022.
This is due to the largest increase in interest in small businesses, defined as those with 250 or fewer employees, among university majors. These companies may not have the perks of larger companies, such as ping pong tables and off-site retreats at health farms, but they offer more stable roles and have a direct social impact on local communities. can be given, the Handshake report notes.
Another Handshake report in May found that 2024 graduates are applying for more government jobs. About 7.5% of new graduates’ job applications were for public sector jobs, up from 5.5% for 2023 graduates.
Overall, the job market is relatively strong. The United States added a total of 254,000 jobs in September, according to federal employment statistics. This increase was primarily driven by employment in the education and health sectors, leisure and hospitality, and government sectors. In contrast, the information services sector, which includes high-tech industries, grew slower, contributing fewer than 10,000 jobs last month.
At Berkeley, changes in the technology industry are having a big impact. The number of employers participating in major STEM career fairs has remained relatively stable at around 100 companies since the pandemic. But with the exception of Alphabet’s self-driving car division Waymo, no big tech is participating. Instead, sponsors include Bloomberg and TikTok, as well as the U.S. State Department and the Peace Corps.
“We’re seeing more interest from startups and small businesses, but the larger companies are pulling back a little bit,” Pitcher said.
Carnegie Mellon University in Pittsburgh is seeing a similar trend, said Kevin Collins, deputy director of the Campus Career Center. Students are having to work harder than before the pandemic to get roles. His advice is to go beyond the usual online job sites, attend networking events and be more open-minded about potential employers.
“They still play a technical role, but they typically do it in different industries and small businesses,” Collins said.
Carnegie Mellon University is known for its strong robotics and computer science programs, and its graduates have historically been hired by the likes of Google and Uber. This year, the school topped College Transition’s list of universities supplying Silicon Valley with talent.
And while there are still opportunities for big tech companies to hire new graduates, Collins said the West Coast tech giants have scaled back their once-aggressive campus recruiting efforts since the pandemic. Instead, some high-tech students are finding jobs in traditional industries such as financial services, he said.
“It’s probably a healthier market in the sense that it’s a broader market,” Collins said.
When Madeline Bulletin entered Carnegie Mellon University as a student in 2022, she knew the job market would be competitive. She says she sent a message to the career services office the same day she got her university email address. As a freshman, she had already heard from upperclassmen about the competitive nature of the job market as companies canceled job offers amid post-pandemic business cuts.
Brutin said searching for a full-time job is still stressful.
“Sometimes I hear back from companies for months or even days, and I find myself at a crossroads wondering if I should apply further. Should I acquire more skills or should I just wait?” said.
Brutin, who studies computational finance, looked beyond Silicon Valley’s “pure technology” companies. Although she is still job hunting, she had already been offered a full-time position after previously interning at Bloomberg.
