Employers Withdraw Job Offers as Economy Turns Uncertain

Technology companies are withdrawing job offers they’ve made to recent graduates and erstwhile new hires. According to Reuters, giants like Twitter have spread the news by initiating brief video calls at almost any hour of the day. One associate product manager got her 15-minute call at 10:45 p.m.

So far in 2022, more than 21,500 U.S. tech workers have lost their jobs, said Layoffs.fyi, a website that monitors job cuts. In May alone, tech layoffs jumped 780% over the period January through April combined said the outplacement firm Challenger, Gray & Christmas.

Many reductions have been seen certain segments pf technology, like crypto or venture capital-backed businesses, which are moving into an austerity-focused frame of mind. The reasons: the recent crash in cryptocurrency is making companies there more cost-conscious, while VC-backed companies want to avoid going back to investors for additional funding. The payments companies Klarna and Bolt Financial together laid off 900 workers recently, while businesses like Meta Platforms (formerly Facebook) and Uber Technologies said they plan to slow or freeze hiring.

Against the Tide

Whether companies are snatching jobs away or not, hiring in the tech sector remains strong, Reuters said. That includes tech roles in healthcare, finance and IT. But for those who’ve won and lost a job, the landscape is particularly bleak. These candidates have been locked out of their almost-employers, which have already put together new groups of recruits. “Pretty soon,” said one, “I’m also going to be competing against people graduating in 2023.”

While executives say the overall job market remains strong – the unemployment rates is pegged at about 3.6%, near its 50-year low, reports The Wall Street Journal – employers are finding it more difficult to forecast their business over the next 12 months. “When a company revokes a job offer,” the newspaper said, “it indicates a company’s business outlook has changed so quickly it has to undo hiring plans made sometimes weeks before.”

Brian Kropp, distinguished vice president of Gartner’s Human Resources practice, believes companies that are withdrawing offers risk “potentially catastrophic” reputational damage.  “Just think about how unfair that is to people you’re rescinding the offer from,” he said. “You’re putting them in a painful situation.”

By Mark Feffer

Mark Feffer is executive editor of RecruitingDaily and the HCM Technology Report. He’s written for TechTarget, HR Magazine, SHRM, Dice Insights, TLNT.com and TalentCulture, as well as Dow Jones, Bloomberg and Staffing Industry Analysts. He likes schnauzers, sailing and Kentucky-distilled beverages.