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| It's difficult to look for a tech job right now. Fotografía de eLuVe/Getty Images |
The tech job market has been stuck in a deep freeze, leaving many software engineers, data analysts, and computer science graduates facing a stark reality: now might not be the right time to look for a new role or push for a promotion. Despite the constant buzz about innovation, AI breakthroughs, and digital transformation, opportunities in the sector are scarce, and competition has intensified.
A combination of factors has created this bottleneck. The hiring boom of the pandemic years, fueled by low interest rates and aggressive expansion, has given way to a prolonged slowdown. Big Tech layoffs have grabbed headlines, but the broader problem is more complex — a glut of skilled workers, a surge in new graduates, and emerging tools like AI-assisted coding have increased the supply of talent, while demand for new hires has lagged far behind. As a result, tech professionals face one of the most challenging job markets in recent memory.
Tech Job Postings Have Plummeted Since the Post-Pandemic Peak
According to Indeed Hiring Lab economist Brendon Bernard, tech job openings peaked in early 2022 before entering a steep and sustained decline. Since mid-2023, opportunities have remained weak, with the downturn in tech postings outpacing the slowdown in the overall U.S. labor market.
Bernard points to several factors behind the slump. The industry is still dealing with the aftereffects of its earlier hiring surge, when companies staffed up aggressively to meet pandemic-era demand. This overhang has been compounded by tougher economic conditions, including the Federal Reserve’s interest rate hikes that began in March 2022. Higher borrowing costs have made it riskier to fund big, speculative tech investments, leading many firms to scale back hiring plans.
Artificial intelligence could also be playing a role in stalling a recovery. While AI is creating new possibilities, it’s also enabling companies to streamline workflows and accomplish more with fewer employees, potentially dampening the need for fresh talent.
Unemployment for Young Tech Workers Is Above Pre-Pandemic Levels
Breaking into the industry has become especially challenging for recent graduates and early-career professionals. A Burning Glass Institute analysis found that the unemployment rate for Gen Z and younger millennials in computer and math occupations has risen compared to 2018 and 2019 levels.
Historically, “knowledge economy” sectors — the white-collar industries that typically absorb college graduates — have acted as a reliable landing zone for young talent. But hiring in these fields has slowed considerably, leading some economists to suggest they’ve reached a “new lower-employment equilibrium.” This quiet contraction has been particularly punishing for younger workers trying to establish themselves in the post-pandemic workforce.
The divide within Gen Z is striking. Older members of the generation, now in their late twenties, entered the job market during the hot labor market of 2021 and 2022, when companies were scrambling to attract and retain talent. Many benefited from the wage inflation of the Great Resignation. But younger Gen Zers entering the workforce today are facing a much colder reception, with fewer openings and employers unwilling to pay the same premiums.
Even If You Have a Tech Job, Promotions Are Slowing Down
The challenges don’t end once you’ve secured a role. Data from Gusto, a payroll and benefits platform for small and midsize businesses, shows that the promotion rate in the technology sector has slowed more sharply than in any other major industry since the Great Resignation.
Gusto economist Aaron Terrazas attributes part of this slowdown to a normalization after the aggressive talent-retention strategies of 2021 and 2022, when promotions and raises were often used to keep employees from leaving. Now, as companies tighten budgets, those internal advancement opportunities have become less frequent.
The reasons are both cyclical and potentially structural. High interest rates, ongoing economic uncertainty, and a more cautious corporate mindset have all contributed to the current stagnation. Whether this becomes the “new normal” for tech career progression remains to be seen, but for now, mobility within the industry is limited — and patience is becoming an essential career skill.
The post-pandemic hiring boom in tech has given way to a period of contraction and caution. Job postings are down, unemployment among young tech workers is higher than before COVID-19, and even established employees are finding it harder to climb the ladder. For now, the safest bet for many is to stay put, continue building skills, and be ready to act when the market thaws. In a sector that thrives on change, the next upswing will come — but until then, the competition will be fierce.
