WHAT’S BEHIND TECH’S RETENTION PROBLEM
For much of the pandemic, tech firms were able to fend off the Great Resignation. Tech companies were quick to embrace virtual work, capitalize on opportunities in rapidly changing markets, and shower their employees with lavish perks.
But the ground that technology companies gained in the talent landscape is waning; the Great Resignation is knocking on the door of these once extraordinarily enticing firms.
LinkedIn News editors reported this morning that share prices of the six biggest tech companies have taken major slides — at least 11%, some falling a lot more — over the last few months. And according to Bloomberg, that’s making it harder to find, and keep talent.
While warning signs in financial performance are certainly part of the equation, it’s not the only reason tech is struggling to attract and retain their teams.
Based on my observations, here are four other factors that are contributing to tech’s retention problem:
- People aren’t buying the promise of (delayed) prosperity.
Years ago, joining a tech company pushing towards an IPO would be considered the most exciting opportunity ever. Now, that excitement is often tinged with a bit of trepidation.
With good reason. Look no further than WeWork, Uber, or Theranos. The tech talent landscape is filled with examples of unrealistic trajectories and baseless promises. The current dip in stock prices only feeds that fear.
Unfortunately, the senior leaders of these organizations are typically so personally invested in the certainty of a wildly successful financial outcome, they struggle to see why others (particularly newcomers) may be less enthused.
- Tech often fails to execute hybrid well.
Tech firms were quick to embrace work from home. The challenge is, in a remote-only environment, tech companies tend to be ‘always on.’ When you can hear your Slack messages rolling in at 9PM, it’s hard not to feel entirely consumed by your job, and eventually burnout.
On the flip side, many of these firms are now moving entirely back to the office, which comes with its own set of challenges. Employees are reluctant to surrender the ‘pros’ of working from home, like less commute time and lower childcare expenses.
In any industry, tech or not, flexibility will reign supreme. There is no broad-brush stroke that will address the needs of each individual and team. Tech giants (and other companies) with sweeping, immovable policies are in for a challenge.
- Leaders remain underprepared.
One of the most alluring aspects of tech is the growth trajectory. You can climb the proverbial ladder quite quickly. Unfortunately, that results in a leadership class that is woefully underprepared to lead.
I most commonly see this in mid-level leadership. High-performing individual contributors are promoted to ‘manager’ with little or no guidance on what that means. But it happens at the top, too. Charismatic founders, CTOs, and VPs of sales often lack the core leadership skills and support they need to be effective. This can create confusing and, sometimes, toxic environments for new employees.
- The “rat race” culture just isn’t appealing.
I’ve watched it play out a hundred times. It’s a big push “just” until the end of the quarter… until this product is launched… until we get to IPO…until the board relaxes. The push is never-ending, and it only gets less exciting (despite the stakes often getting higher).
There will always be a big goal to work towards; it’s a good thing. Yet, firms that want to win talent must balance the future-oriented push with the present reality of making a difference. People want to know that what they are doing today matters.
Leaders must be proactive in demonstrating how an organization is making a difference to customers and why each team member is valuable.
The talent challenges facing tech today are not drastically different from the talent challenges facing virtually every organization. Tech’s engagement and retention challenges were just temporarily delayed by new MacBooks and unlimited DoorDash.
In this talent landscape, the power is in the hands of the employee, more than it has ever been. People want to make money, of course, but they also want to make a difference, and live a balanced life through it all.