In the wake of COVID-19, companies are struggling to cut budgets and to adjust to a fully work from home environment.
A hiring freeze is a hold on hiring new employees. A company may decide to do that across all roles, or only for what they consider "non- essential roles". It is usually a way to control costs/ cost-cutting when a business takes a downturn — you may find it accompanied with a freeze on negotiating pay rises too. Since the costs of salaries and benefits are usually the largest expense a company carries, this is usually one of the first steps to manage the books and increase runway.
A hiring freeze is also a way to avoid or delay the need to have layoffs.
Most companies are not affected.
While some will struggle during this downturn, some industries in tech are actually booming. FAANG is hiring at a steady pace. There is no change in companies' willingness to negotiate compensation and offers across major tech companies are in the same range as pre-downturn.
We see smaller startups and tech companies serving verticals most affected by the recession ( where there is less customer demand) announcing hiring freezes. Some smaller startups have also on occasion rescinded offers prior to the start date but those are few and far in between. You can find a frequently updated list on companies still hiring and those on freeze here.
Only some roles are in danger
Just because there's a hiring freeze, doesn't mean the role you're interviewing for will be affected. Some new positions are considered essential and will be filled no matter what - don't get discouraged if you're just now starting your job search. There are plenty of open roles and companies actively continuing to onboard new hires.
To be safe, recruiters are your best resource - if you're already in the process, ask " Is this role considered essential?"
What if I'm offered a delayed start date?
In some cases, companies continue to hire and make you an offer HOWEVER the start date is pushed out by 3-6 months. In this situation, we 're seeing companies compensate by offering larger than usual sign-on bonuses. Be careful - if a company feels they can't afford to hire you now, what makes you so confident things will change dramatically in 6 months? Be sure to ask this question and have a realistic discussion with the recruiter, especially if you're in a technical role. Technical interviews take awhile to ramp up for and the last thing you want is to do it all over if your offer is pulled before you join.
A strategy to deal with this if you really like the company is to offer to join part-time or without benefits ( if you feel confident being able to afford them on your own). This is not at all ideal financially and should only be a very short-term consideration for you if the company also agrees to give you back pay once they ramp back up. Don't put yourself in limbo if you don't have to - prioritize offers with immediate start dates from established companies.
Can they pull my offer if I've signed?
Yes, definitely - your offer can be rescinded at any time, even after you join. What companies consider an essential role can change quickly in this economic environment. It's best to concentrate your job search on companies who have a product consumers/ businesses still want in a recession.
Be especially mindful taking on a role that requires a relocation for a smaller company. If you're moving to New York to work for Google, you will likely be fine but if you're moving for a 50 person startup - consider this carefully. Bottom line- if you move and your offer is pulled, you may have little recourse against the company for uprooting your life. We recommend taking the offer, working remotely and only moving when things have calmed down. Everyone is working from home right now, why shouldn't you?
Internships are heavily affected
Many companies have suspended their summer internships or put them on hold. While this can be frustrating - there are still a TON of exciting internships available. This might also be the summer where you work on the personal project you've always wanted to sink time in or take a ton more online classes from home. If you're feeling lost right now and need some career advice around how to navigate your internship being cancelled, email us @ firstname.lastname@example.org and we'll send you some info on how to navigate this difficult time.
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