Where Are Laid Off Tech Employees Going? | CNBC Marathon
The tech sector shed more than 386,000 jobs in 2022 and the first half of 2023. 80% of Twitter either left or quit or was pushed out, laid off, whatever you want to call it. And yet the website still runs. Even though two thirds of tech workers are men, more than half of those laid off in 2022 and 2023 were women. Approximately 50,000 H-1b holders lost their status due to unemployment over the course of this year. Canada is going to be developing a specific stream for some of the world's most highly talented people that will be able to come to Canada to work for tech companies, whether they have a job offer or not.
Hi, Brittany. Hi. Thanks for meeting with me and Rosie. Um, we have an important meeting today. Uh, we've finished our evaluations of 2023 performance. This is where you have not met Cloudflare expectations for performance. We've decided to part ways with you.
Yeah. I'm gonna stop you right there. This is a viral video posted by Brittany Pietsch, a former employee of Cloudflare, a San Francisco based tech company. The video posted on January 2024 and got so much attention that it may have kicked off a new subgenre of viral video: watch this person get laid off in real time. The tech industry is again seeing widespread layoffs after a rough 2023. LinkedIn just laid off nearly 700 employees.
Qualcomm is planning to cut more than 1200 jobs. Google, Amazon and Snap are among the companies continuing to downsize. And the start of 2024 seems no different as layoff announcements, especially in the tech industry, continue to make headlines.
Units affected they also include hardware engineering ad sales so far. Last night, CEO Sundar Pichai told his workforce to expect more cuts. An Amazon spokesperson did confirm those layoffs. The head of Prime and Prime Video and MGM saying in that memo that the company is making some of the cuts to prioritize investments for the long term. Layoffs are also plaguing industries like health care, banking and media. However, the tech industry is the one that's been dominating the headlines this layoff.
And everything that's happened in tech, I think is pretty eye opening. You know, like you can have your dream job, you can have your oh, it's my dream to work for Microsoft or it's my dream to work for AWS. And you get there and you realize huh, okay. It's just like any other job. It's a great place to be. There's a lot of great perks, but at the end of the day, they can get rid of you like that.
The layoffs to the start of 2024 signal a dramatic shift in the tech industry. We're going to continue to see layoffs happen as the future of work has changed, as the future of technology has changed, and as investors appetite for risk and growth versus profitability has dramatically changed as well. So why are big tech companies and other industries laying off tens of thousands of workers at a time when the US economy looks strong on paper? The start of the Covid 19 pandemic was a dire economic event, at least at first. The tech industry, though, boomed. In 2020, Tech's top seven companies added $3.4 trillion in value.
The Fed's emergency moves to bolster the pandemic-hit economy, like cutting interest rates to near zero, helped boost tech stocks. This move helped the tech industry to expand and went on a hiring spree as people were confined to home. Amazon added the most number of employees during this golden period, peaking at 1.6 million employees in 2021.
If you rewind before the layoffs, all the tech companies were really putting an emphasis on growth, and so capital was really cheap, you know, so you could get loans, you could get money. Access to capital was really affordable. And then you see, as interest rates went up and you start to see that that growth in headcount didn't translate to growth and profitability and access to capital became quite a bit tighter. You saw many companies start to hit the panic button. And so we saw these thousands and thousands of people get laid off all at once.
And that was quite a shock. 80% of Twitter either left or quit or was pushed out, laid off, whatever you want to call it. And yet the website still runs. Um, do you think people are looking to Elon Musk and thinking, you know what, we really need all these people. I do give Elon Musk credit for this, for kicking off and making this acceptable Twitter. But a lot of the big companies decided to get lean and efficient.
And, you know, this is where you kind of start to see the incredible leverage of what these tech platforms really have, which is they didn't need those people, right? They were hoarding the talent. It was an option bet, and it was a cheap one for them. Yeah.
I ask every tech CEO, do you take inspiration for what Elon does? And they'll say on the record, no, we don't. We would never want to do that. But, you know, in the group chats, they're all like, wow, that was an amazing move.
The artificial intelligence hype of 2023 is starting to have real world effects. In 2024, major tech CEOs are doubling down their investments in AI. In January 2024, meta CEO Mark Zuckerberg announced his plans to build an artificial general intelligence known as a GI.
Hey everyone. Today, I'm bringing. Meta's two AI research efforts closer together to support our long term goals of building general intelligence, open sourcing it responsibly, and making it available and useful to everyone in all of our daily lives.
All this investment in creating AI jobs, but at the expense of others. The recent report from indeed shows that the number of job posts containing gen AI terms has been surging. So there's about a 500% increase in the number of jobs that mention generative AI. There's about a 6,000% increase in the demand for job seekers for these jobs.
But there still is, I think, a mismatch the other way in that the total amount of demand for AI talent far outstrips the number of AI professionals. Every company in every industry is trying to figure out how to use AI in everything they do. I mean, AI is going to create a lot more jobs as well.
But at the same time, I would say that there will be jobs that will be automated. So you think AI has already hit the business effectively? Oh, absolutely. Absolutely. Especially in the tech sector. I mean, they've been talking about it for years now. The fact that you have more companies moving toward artificial intelligence, and they're looking at the fact that as opposed to paying somebody 200 or $300,000 a year to do the job, I can actually use artificial intelligence to do the job that they used to be able to do. This AI thing is real.
It's not going away, and they can't have people holding them back. And so what they've been doing over the past year is finding places within the organization that they can trim so that they can get to a place where they're shipping faster. So taking managers out and then engineers who are skilled for previous generation of technology, they're also leaving to make room for people who are more skilled for artificial intelligence. Ai is definitely playing a role in the layoffs that we're seeing. Uh, automation has increased efficiency for some of the workers who are able to to utilize AI to make marketing decisions, to analyze data, to serve customers more efficiently and effectively. So AI is a paradigm shift that is changing the way people work and changing the priorities of tech companies.
Right now, I don't. See that there's a big impact from AI in these tech layoffs. Uh, some businesses have maybe cited that they're trying to, you know, shift priorities, and they're letting some employees go to focus more energy on some of these generative AI tools. But I think it's important to say that that's very different than saying that companies are. Well, we can let people go now because, you know, generative AI and all these tools are taking jobs. The tech industry used to have this shiny image of having big salaries and unlimited perks, but the recent tech layoff stories have completely shattered that image.
I really don't have any regrets about posting it or what's happened. I think the bigger picture is that I've been able to be a voice for people who have gone through something similar. You know, the stories that I've received of people who were laid off 20 or 30 years ago and they still remember to this day how that made them feel, and it did not make them feel good. And I think that we should shed light on stuff like that so we can make a change, otherwise nothing will change.
In my experience, the public sharing of things like one's layoff I think is partially due to the fact of the rise of social media such as TikTok, even YouTube shorts. People are becoming much more comfortable with sharing their experiences. And oftentimes when layoffs happen, people feel shame when they are being laid off. In reality, though, oftentimes if people are being laid off, it's a failure of leadership of that company.
Tech companies that conducted widespread layoffs have seen a bounce in their stocks. The tech heavy Nasdaq climbed 43% in 2023, its best year since 2020. Meta was the biggest gainer among big tech, surging over 194%.
The tech stock boom also helped boost the wealth of tech billionaires. The super rich CEOs saw their wealth grow by 48%, or $658 billion, in 2023. It's hard, particularly for a company like Google, which over the past 25 years hasn't gone through a moment like this. But, you know, we've always deeply cared about our employees.
Layoffs are not a sign of a negative developments. They are, in some sense a sign of positive developments, of a greater demand for their services and of automation and productivity improvements. Now we see the stock market reacted quite favorably to this round of layoffs. We see these record stock prices for a lot of these tech companies. And so the stock price, the investors really favored profitability, really favored this lean year that these tech companies had.
And so instead of rewarding the growth that we saw them all pursue years ago, they're now rewarding profit. And so the layoffs have continued. People have become used to them. And regrettably and sadly, it seems that the layoffs is going to be the new normal. Data suggests an influx of layoffs in the tech industry starting from the second half of 2022 and peaking in 2023. Some non-tech sectors are also seeing widespread layoffs. A prime example is UPS.
The Courier giant raised eyebrows by announcing 12,000 job cuts in January. The media industry isn't immune to layoffs, either. In 2023, the industry shed over 20,000 jobs.
And 2024 looks no different as big names like Paramount, NBC, Sports Illustrated, the Los Angeles Times all have announced major job cuts in early 2024. The banking sector is also not shying away from cutting jobs. Citigroup, Morgan Stanley, Deutsche Bank are some of the big names that have already announced their layoff plans for 2024. It's worth noting that even though these mass layoffs continue dominating headlines, labor markets still seem strong. The US economy added 353,000 jobs in January, much better than the Dow Jones estimate for 185,000 jobs, with the unemployment rate held at 3.7% against the forecast for
3.8%. Experts are divided on whether the recent tech layoffs would trickle down to non-tech sectors. Looking at the current job market right now, there's no evidence that we're going to see any trickling. Obviously, you know, kind of the jury's still out.
It's still early to tell. But it's interesting, as we look back at 2023, 2023 was a year of a lot of layoffs in the tech industry, and we didn't see any of that trickle out. Even within the tech industry, which is usually the government usually defines it as the information sector.
We didn't see a very high layoff rate, so we saw a lot of companies announcing layoffs. But those companies kind of carried an outsized share of the media because then once we rolled it all up, there was maybe about 1% of employment that was being laid off. So really, ultimately, the overall rate of people losing jobs to layoffs remains near historic lows. It hasn't yet trickled down to the rest of the economy. As we're seeing, the stock price is really high, unemployment fairly low. But at some point, if this continues, uh, both companies and individuals are going to have to cut back spending. And that has consequences that reaches far beyond the tech industry.
The tech sector shed more than 386,000 jobs in 2022 and the first half of 2023, and that number is climbing. Google today joined a growing list of tech giants scaling back, adding to the tens of thousands of workers in the industry who find themselves unemployed. It is Amazon doing another round of layoffs. Mark Zuckerberg's year of efficiency back in focus this morning after another round of sweeping layoffs and job cuts.
The email that was sent out in the morning to everyone in the company basically saying, unfortunately, your role was impacted. And that's how I found out. And then they pretty much shut everything off at the end of the day. I was on the committee that was hiring new college grads. It was like thousands and thousands of applications for maybe like 10 or 15 spots.
But I thought, you know, if we're still hiring new college grads, clearly the company is fine. Why would we hire, you know, new grads if if the company were going to do layoffs? Known for its boom and bust cycles, tech has seen its fair share of layoffs in recent decades. More recently, the industry has faced headwinds related to the crypto crash and the failure of the Silicon Valley Bank. Job postings for software development positions.
They're down closer to 60% year over year, and they are actually below their pre-pandemic levels. So we've seen a much starker pullback in hiring for software development, which a lot of tech jobs. But while layoffs have taxed retrenched workers, a booming artificial intelligence market is giving the industry a renewed sense of optimism. I have been in San Francisco for almost 12 years now, and I have never felt this kind of energy, and I was here for the mobile boom, right? I worked at Uber, which I think was the one company representing that mobile explosion. And I can tell you it was nothing like this. Every cafe, every restaurant, every conversation that you overhear in the street, half of the time it's GPT, it's AI, it's the latest company that's being funded.
It's it's accelerating. Generative AI startup deals announced or finalized in the first quarter of 2023 totaled more than $12 billion, compared with about $4.5 billion invested in the space in 2022. Amazon, Alphabet and Microsoft have also made massive investments. The US tech industry accounts for 10% of the nation's GDP. It employs roughly 12 million people who work in more than half a million companies. Those businesses are concentrated in a handful of coastal areas, including San Jose, Washington DC, San Francisco, Boston and New York City.
So how have layoffs impacted tech workers and what will the AI boom mean for their future? The pandemic and ensuing lockdowns brought the US economy into a tailspin in March 2020, forcing businesses to shut their doors. By May, 23 million Americans lost their jobs. The unemployment rate surged to 14.7%, the highest since the Great Depression. But tech companies face a different climate.
Remote work and cloud computing meant more people were pivoting towards online services, boosting revenue spurred on by rosy predictions and lower interest rates. Microsoft, Amazon, Salesforce, Facebook, parent Meta and Google parent alphabet went on a hiring spree. Meta had about 72,000 employees at the end of 2021, more than 60% higher than 2019. Alphabet had more than 190,000 on staff at the end of 2022, 59% higher than 2019. But after years of unstoppable growth, Big Tech's pandemic bubble burst, forcing tech companies to trim their rosters.
I want to say, you know, up front, uh, that I take full responsibility for this decision. Um, you know, I'm the founder and CEO. I'm, uh, responsible for for the health of our our company. Met was a company I've always wanted to work at.
A Dream Job, a dream company, for sure. Carl Wheatly, a recruiter for meta, grew up in the Bay area and spent four years working for the social media giant. Meta laid off more than 11,000 workers, or about 13% of its workforce, in November 2022, it announced a few months later it was reducing its headcount by another 10,000 employees. I was talking to my family about it.
They grew up in the Bay area. They've been through multiple layoffs over the past. I think for our age group, I would say this is probably one of the, I think, biggest downtrends or look for layoffs. Other companies quickly followed suit.
If you want to think about a company that overbuilt during the pandemic, I'd say that Amazon is the number one company that overbuilt. Where is where are the cuts? Amazon announced in January 2023 that 18,000 workers were being laid off. Two months later, it said an additional 9000 positions would be trimmed. That same month, alphabet cut 12,000 jobs, or about 6% of its workforce.
I thought, Holy crap, I've finally made it. I'm working at probably one of the best companies in the world, and I'm making an amazing salary and I have longevity. Like I am good for many, many, many, many years.
Paul Baker, a video producer in tech, worked at Google for six years. We all got this email early in the morning on January 20th. It's just it just hit me like a ton of bricks. I actually froze, going, wait, is this for real? I opened my work laptop and it says no access denied.
Like no passwords are working. So I had to look at my personal laptop, which had an email from them stating, hey, you've been officially terminated. We're giving you two months notice, but like you're cut off, you are banned from going to any Google office. You cannot contact anyone like nothing. Company leadership was in a far different position.
Alphabet CEO Sundar Pichai's 2022 compensation, for example, was worth $225 million, about 800 times the pay of the median employee. The company's stock has continued to climb since the announcement. Other companies in this space that made cuts to their workforce include Microsoft, Salesforce and SAP. While tech layoffs have been painful, the blow has been cushioned in many cases by generous severance packages. Recently laid off google employees in the U.S. received 16 weeks of pay plus two weeks for every year of employment.
Salesforce employees received a minimum of nearly five months of pay. Stephen Campbell, a software engineer, was laid off from Airtable, a cloud based project management service, in December 2022. One night I stayed up especially late and woke up to a bunch of slack messages saying, are you safe? Are you okay? And I thought, like, was there an earthquake in SF? Like, what's going on? Obviously I'm safe, I feel fine. And as I woke up a little more, I thought, oh no, like, I know what this is. And so I, like, opened up my work laptop and I got a notification saying, like, your access to this laptop will end in 30 minutes. With help from a severance package, Campbell co-founded two new businesses.
RevAmp AI uses machine learning and generative AI to get insights into customer data sets. His other business hosts in-person events to discuss the future of generative AI. The thing about generative AI in San Francisco right now is that there's similar buzz to crypto, right? There's all these meetups which I'm fortunate to throw some of them. There's all this venture investment going into it. I mean, absurd amounts of money is getting funneled into generative AI startups. The difference for me between generative AI and something like crypto is generative.
Ai is solving problems for people today. It's delivering value for people today. San Francisco has 11 out of 20 of the top AI companies in the US by dollars raised. Collectively, those businesses took in $15.7 billion between 2008 and 2023. Investments in automation and AI at big tech companies could be a contributing factor in recent layoffs, meta CEO Mark Zuckerberg told employees prior to its third round of layoffs that investments in tools like AI would help engineers write better, code faster and automate workloads flow. Crivello founded Lindy in 2022. The company's AI personal assistant helps automate tasks for workers like drafting emails, sending calendar invites, and taking notes during meetings.
Something absolutely huge is coming, and I don't think people have quite realized that yet that everything is about to change, uh, especially the information economy and knowledge workers. Steve Jobs said that computers were like a bicycle for the mind. I think that AI is like a jumbo jet for the mind. I think it is. It is going to radically change how people work and go about their lives. Generative AI could add as much as $2.6 to $4.4 trillion to the global
economy annually. I think, counterintuitively, it is actually going to result in a net increase in employment in the tech industry. It's a basic fact of economics that when something becomes cheaper, its complement becomes more valuable. Tech workers are a complement to AI. Ai makes tech workers a lot more productive.
And so when something becomes a lot more productive and a lot more valuable, we want more of it, not less. I don't know if I necessarily would want to say that I don't regret getting laid off sooner, but getting laid off was such an overall positive experience to me. Really, the only downside to it was the initial shock that was tough to deal with. While layoffs are having a big impact on tech companies, the sector is accustomed to periods of growth and contraction. Tech has always been an industry with very high churn, and that actually comes from both sides. So job seekers have always really valued the flexibility that they have in order to jump from tech company to startup to major company to really grow their career.
And at the same time, tech, because it's often at the forefront, has been a subject to big booms and busts. The bursting of the .com bubble two decades earlier eliminated more than 1 million jobs. The Great Recession spurred additional cuts. By 2008, Silicon Valley tech companies employed 17% fewer workers than in 2001. But there are a few key differences this time around.
Even though two thirds of tech workers are men, more than half of those laid off in 2022 and 2023 were women, according to a study analyzing more than 1100 LinkedIn profiles. The groups most heavily impacted by layoffs include HR and talent sourcing, software engineers and marketing employees. Bianca Brown started with meta in 2019. She was laid off from her job as a program manager in 2023. I tried to sleep the night before, I couldn't, and then maybe it was around the 8 a.m. mark. I got the email.
Um, my heart kind of dropped, you know? I took a deep breath and I was like, okay, you know, this this is your new reality. This is something you have to navigate. The study also found 48% of laid off employees were between 30 to 40 years old. 89% were based in the U.S., and the average employee had about 12 years of work experience. And while the number of U.S. tech jobs are projected to slightly lag the longer term trend, the demand for tech workers should remain high for the foreseeable future.
The unemployment rate for tech workers as of May 2023 was 2%, well below the national figure of 3.7%. While tech companies shed a modest 4700 jobs that month, over the course of the entire year, a significant number of jobs were added in IT services, cloud infrastructure, data processing and hosting, and tech manufacturing. Employment opportunities for software developers is predicted to grow by 26% between 2021 and 2031.
It is a cooler job market for tech workers than it was maybe a year or two ago. But at the same time, a lot of these skills and experiences from the tech sector are still in high demand. Oftentimes, these tech skills and this experience from the tech industry is very valuable in other parts of the economy as well. Tech workers are also finding jobs in other industries desperate for their skill set, ranging from financial services and manufacturing to the government. Nationwide, tech workers earn on average $87,000 annually, 60% more than the average U.S. salary of $54,000.
California tech workers average about $117,000 a year. Despite those trends, competition for jobs remains fierce as unemployed workers face a restless job market. I've already applied to probably about 165 jobs, and I've had only two interviews, and both were first interviews after the recruiter, and they ghosted me, like, didn't respond to my emails. Nothing. So we're also living in a time where people just don't get back to you. But if you go on LinkedIn, there's so many recruiters and designers and engineers and everyone in which looking for jobs, right? There's hundreds or thousands of people applying for the same role. I just tell everyone to kind of put your sales cap on, get a tool where you can find emails, and you kind of have to go out there and kind of find your own job.
The H-1b visa program is essential for bringing qualified technical capability into the country. We need to bring Americans back into the workforce and reform existing programs before we expand immigration. If 2 million more immigrants came to the US each year, we could reverse our predicted population and productivity decline.
After decades of deliberation surrounding US immigration policies. High skilled tech workers are looking towards a new country Canada. Many warn that if the US doesn't find a way to bring in more of the world's best talent, other countries like Canada will.
Canada has launched a new initiative to attract this talent, as well as so-called digital nomads and skilled American workers. But how did we get here? And how does a country that is home to the world's biggest tech companies lose thousands of highly skilled workers to Canada? We spoke with several foreign tech workers and immigration consultants to uncover the story of how the US's bureaucratic visa process pushes workers north. It is very stressful.
Every single year. The stress increases. It's not straightforward, it's very convoluted, and you have queues and queues. Your ability to even work in a country and contribute to the country is just going to depend on a lottery.
The H-1b visa is a nonimmigrant work visa that allows US employers to hire foreign workers in specialty occupations. Specialty occupations require an area of expertise and at least a bachelor's degree or its equivalent. These jobs often include high skilled workers in tech.
Since its creation in 1990, Congress has limited the amount of H-1b visas available each year. The current cap is 65,000, with an additional 20,000 made available for graduates of an American university with a master's or doctorate degree. Because the visa is sponsored by an employer, holders who lose their jobs have 60 days to find a new job, transfer their visa status, or face deportation.
Shiva Koul is from India but came to the United States to study in 2013. She started working at Microsoft in 2018, who sponsored her H-1b visa. I was lucky enough the first time, but I've had friends who've had to apply multiple times and friends who did not get selected or picked up in the lottery at all. Getting an H-1b visa has become increasingly competitive. In order to get approved, an employee has to be sponsored by their employer and then go through a rigorous application process.
Once vetted, they are entered into a pool of applicants who are randomly selected for a visa. Harinder Singh, a software engineer that has a bachelor's and master's degree from Georgia State and is an H-1b visa holder, knows all about this. I have been in the lottery three times, and it took me three times to get accepted in the lottery. For the first year, I wasn't accepted.
For the second year I wasn't accepted. It was very stressful because if things don't work out, you have to leave the country. In 2021, nearly half of the eligible registrations received a selection for the random drawing.
But for the upcoming 2024 year, out of the 758,000 registrations received by the government, only 188,000 were selected for the final random drawing, meaning less than 25% received a visa and thousands were turned away. Once someone receives an H-1b visa, they'll face a number of restrictions. I've been living here for a decade. I've been paying my taxes since my student years. I don't have the same level of rights that a person who's from the states would have, but I have the exact same and even more number of duties since you're not a citizen, and since you don't have a green card, you can't even work at a subway. Because you're restricted with your visa status in the US, and you don't even have flexibility to move around, you don't really have flexibility to change jobs.
Plus, the green card process, which is the pathway to permanence in the US, is a very, very tedious and a long one. Since holders are at the will of their employer, they cannot change jobs or work side gigs. The spouse or child of the holder also cannot work without applying for employment authorization. So you have highly educated spouses that are just, you know, sitting in the US not able to work. Sometimes they're PhD holders that are just staying home because they can't even work.
A natural way to get past this bump is to apply for an employment based green card. But for holders like Shiva who come from highly populated countries, the backlog is longer than her lifespan. It's painful because all that's left between me and that green card is one piece of paper. That is the last step of the green card. And because there's a backlog, that's why I can't get to that. There is no other reason for that.
The US implemented a country cap of 7% for green cards, which means H-1b visa holders born in highly populated countries like India and China are experiencing lifetime waits. 75% of the people who are on H-1b visa in the US were born in India. Majority of Indians suffer by this wait time a lot.
They can never get permanent residency in their lifetime. In 2023, the backlog reached a record high, with 1.8 million people waiting and 1.1 million of those people came from India.
With the grim path to permanent residency, a lot of H-1b tech workers are exploring their options. H-1bs were moving to Canada, applying on their own for the permanent residents and doing it since I started, you know, 20 years ago, the highly educated foreign national is really at the mercy of the US employer. Big tech companies account for a large amount of H-1b visa approvals. Amazon, Google, Microsoft, Apple and Meta accounted for over 60,000 approvals in the last two years, but all of these companies, except for Apple, underwent major layoffs in the past year, leaving H-1b visa holders in limbo.
Like what affect that would ever take that is going on. And the US immigration rules. You have up to 60 days to leave the country. You have to gather your everything.
And if you don't have anything doing, you have to leave the country. Originally from Ghana, Anokye moved to the US in 2019 on a student visa, he received a bachelor's and master's degree in materials science and engineering. After being laid off from micron earlier this year, he transferred his H-1b visa status to a visitor visa while searching for his next step. I'm still looking for jobs in the US. It's not easy. Even till now, companies are still laying off, so it's kind of a bit difficult. From October 2022 to April 2023, approximately 50,000 H-1b holders lost their status due to unemployment, and 12,500 of these workers did not transfer to another legal status, meaning they had 60 days to find a new sponsor or potentially face deportation.
Then on June 27th, 2023, this happened. Over the course of this year, Canada is going to be developing a specific stream for some of the world's most highly talented people that will be able to come to Canada to work for tech companies, whether they have a job offer or not. And on July 16th, Canada opened visa applications for a pilot program that would allow up to 10,000 H-1b visa holders in the US to apply for a three year open work permit in Canada.
This is unprecedented. Never heard of any similar program in the past, and. The program was a huge success, reaching its 10,000 capacity on the first day. But this pilot program is only one part of Canada's tech talent strategy a larger, multi-year plan to recruit the world's top tech talent.
There's been an unprecedented labor shortage in Canada. The tech field is growing, and the labor shortage has been significant in that specific industry for years and years. So that's why the focus is really it's really to be able to provide the businesses in Canada and the economic situation in Canada, the economic immigrants it needs based on their skills. Basically, Canada's tech market has grown 15.7% since 2020, outpacing the US, which grew at 11.4%. The country now has 1.1 million tech workers, which makes up 6.5% of the workforce.
A CBRE study found that Toronto and Vancouver rank inside of the top ten tech cities in the US and Canada, with Ottawa and Montreal ranking ahead of major US cities like Atlanta and Chicago. Canada is also home to Shopify and other big tech companies like Dell, Intel, Microsoft and Amazon all have a presence. Both energy and coal were affected by the tech layoffs and have applied for and received their Canadian work permits.
I knew he was going to be very competitive, since there was a lot of other US workers who also have been affected on layoff, and even those who have not yet been laid off. My main reason was to have a sense of security. I wanted to make sure that if nothing pans out, if I can get a Canadian work permit and apply for positions in Canada before my grace period expires, I can just move.
The open work permit is not job specific, which means they can work in any industry and are not limited to tech. And unlike the H-1b visa, they do not need to have a job lined up before moving to the country. Currently, it is on my plan of trying to move to Canada if I am not able to find anything within the US as soon as possible. Personally, I prefer, um, mostly like jobs in my field of study. So engineering. Others, like Singh, didn't apply but had Canada as a backup plan. I had already applied for a different program to have a work permit in Canada, so I was already in the process to go to Canada as a backup option.
Not everybody is jumping on the next flight to come to Canada. They're probably taking their time out of these 10,000 applicants and their families, how many actually do arrive in Canada? I also understand, at least from some of my clients who have applied for this option only as a backup plan. They don't intend to move to Canada in the immediate future. They probably want to wait for six months, one year, probably see how it's going on.
The Canadian government issues work permits at the point of entry upon an approved applicant's arrival in Canada. It says so far, more than 6000 work permits have been issued under the H-1b temporary measure. The H-1b is a really good when they move to Canada because they established economically, they adapt really well, and usually they like Canada because it's very similar to the US.
It's always been a pool of ideal candidates. Canadian Immigration Minister Marc Miller wasn't available for an interview, but a spokesperson provided this statement. The immense interest in Canada's H-1b visa application stream is a strong indication of just how competitive Canada is on the global stage. By 2030, the number of Stem jobs in the US is projected to grow by 10.5% to 11.3 million. But in 2019, only 14% of us Stem students worked in Stem post-grad.
In fact, 62% of college students that studied Stem worked in non Stem fields in Canada. After graduation, foreign students have an easier pathway to permanent residency, the equivalent of the US green card. In Canada, most of our work permits are study permit.
There is a direct facilitated pathway to permanent residence. It's fairly new where retention is very important because statistics show that people who studied here or worked here are the best at establishing economically and contributing. Hakuna Kochar is a tech worker who came to Canada on a student visa from India.
He has since been able to gain permanent residency. I didn't want to go to a country where I feel like I would always be a foreign resident for a long time if I ended up working there, and to me, Canada felt like a much safer option. I graduated in 2021 and within a one and a half year, I already have my permanent residence. Full time tech workers in Canada have an average salary of $94,800, while the US is $129,700.
However, this hasn't fazed many immigrants. I'm pretty stable in Canada versus I know many similar friends who chose the US as an option, who didn't, who are still like struggling with that. And many have ended up coming to Canada as well.
In Canada, the government uses a point based system based on a number of factors, including language skills, work experience, age, and education to determine visa eligibility. Unlike the US, it does not base your permanent residency status on your country of birth. The Canadian immigration system in Canada is not perfect, but it is more responsive to the, you know, globalization and the change of the labor market or the economic situation more than where the person comes from. It offers a lot of permanent stability, peace of mind, and that is not easily accessible in the current US immigration system.
Some say Congress needs to act in order to retain top talent in the US. People should just take a step back and just revisit and make changes in one go, instead of like taking eons to make those changes because it affects people's lives. Reform is is needed based on the circumstances. But I think that all civilized countries are moving towards, you know, shortage of labor, especially qualified labor. I mean, that's it's that train has left the station everywhere.
The policies are extremely inflexible. And when I say inflexible, they haven't changed with times like there was a time when only a few thousand people came in from a particular country. Now you have, you know, plethora of people coming in from those countries. As for the future, where do these tech workers see themselves? If I had opportunity, I would like to stay in the US, but if that doesn't work out, Canada is also a great country, especially for immigrants. I don't think.
I would want to stay in the states long term for sure. I think right now people are choosing to go more to Europe, Canada and Australia as opposed to the states. And frankly, if somebody asks me today if I would suggest that they come here, I would not recommend it.
So long term. I'm definitely going to stay in the US because at the point of career I am right now, I have more opportunities in the US. I haven't really considered living anywhere other than Canada because I'm very happy here.
2024-09-30 19:42
