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21 juillet 2022 · 5 min de lecture
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Voir les offres d’emploiMU professor: Job market still favors job-seekers, but recession fears could change that
- Tech companies like Twitter and Coinbase lured new grads with lucrative salaries earlier this year.
- Now they're rescinding offers, leaving grads scrambling just before their start dates.
- Many had turned down other opportunities, and some were counting on the promised jobs for visas.
- When Travis Chan, a rising senior at the University of California, Davis, accepted a position as a software-engineering intern at the video-messaging startup Loom in January, the tech industry looked very different.
Almost 80% of 2021 graduates took the survey.
| 2021 | 2022 | 2023 | |
|---|---|---|---|
| Rolex | 25000 | 32000 | 25000 |
| Omega | 25000 | 25000 | 32000 |
| Cartier | 25000 | 32000 | 25000 |
| Longines | 32000 | 25000 | 25000 |
| Patek Philippe | 25000 | 32000 | 25000 |
| Audemars Piguet | 25000 | 25000 | 32000 |
| Tissot | 25000 | 32000 | 25000 |
| IWC | 32000 | 25000 | 25000 |
| TAG Heuer | 25000 | 25000 | 25000 |
| Hublot | 25000 | 25000 | 25000 |
| TEST Scratch | 20000 | 25000 | 25000 |
Companies like Coinbase are rescinding tech grads' job offers en masse just before graduation, leaving them scrambling with their plans 'in ruins'
Tech was in a hiring frenzy, and Loom was fresh off a massive $130 million Series C funding round backed by impressive venture-capital firms like Andreessen Horowitz. Its head count had more than doubled in the past two years as it joined firms like Amazon, Google, and Zoom in riding high amid a pandemic boom.
Just a few months later, the other shoe dropped. Valuations and market caps were slashed in half, pushing high-flying startups and public tech giants to tighten their belts. Now, just two weeks ahead of his start date, Chan told Insider he received a "surprising and devastating" phone call from his recruiter. Because of "unforeseen economic circumstances," his offer was being rescinded.
While some firms have conducted layoffs in the downturn, others have made the rarer move of rescinding job offers en masse just weeks, or in some cases days, before new employees' start dates. And one group has been uniquely caught in the middle: tech newcomers such as interns and fresh-faced college graduates who had their first-ever jobs taken away before they even began.
Twitter, for example, recently rescinded offers extended to candidates, pointing to larger turmoil after Elon Musk announced he was buying the company. Coinbase, which planned just a year ago to more than triple its head count, rescinded over 300 offers — a large portion of them new-grad engineers. Once hot startups like Redfin and Loom, which raised millions in funding last year, also laid off employees and cut many new grads loose in attempt to cut costs.
The former intern, who asked to remain anonymous to protect future job prospects, was just three weeks out from graduation when he learned the opportunity he had worked for and planned his future around was gone.
"It was really scary — I had just been there a week ago, visiting the office and getting shown around. And I found out a week later that a lot of my colleagues knew that it was probably going to happen, but they weren't sure if they were allowed to tell me," he said.
Throngs of devastated new grads and interns who thought their job plans were secure have taken to LinkedIn and Twitter to share how they've been scrambling. Many describe how they turned down other lucrative opportunities or were in the process of moving across the country for jobs they no longer have, while others who were counting on the job for visas are now in a particularly tight spot.
"People have been really supportive. But it's my finals week, so I'd have to job hunt while also balancing schoolwork," Chan said, adding that despite recruiters and other engineers helping him land interviews, he'd decided he's done with the job-hunting process and would instead take up an old job.
"It's just too tiring to deal with anymore," he said.
New grads are frustrated, saying tech companies mishandled communication and left them in the dark
While many new grads who Insider spoke with said they understood cost cutting was a necessary part of the industry, they were frustrated with how tech companies mishandled communication.
For example, the new grad who was set to join the e-commerce startup said communications from management seemed "like the company was moving in a positive direction." But once the firm suddenly started laying off employees, he said he was met with two weeks of radio silence and "nonanswers" before human resources called him saying that his return offer had been rescinded.
"I am someone who really likes certainty, and suddenly everything was in jeopardy. So I went into panic mode," the former intern told Insider. "I was moving to New York in a few weeks because of this job, and I suddenly found out that I'm about to move to New York unemployed."
For many international students, these last-minute changes are not just questions of their careers or livelihood — their visa status is dependent on securing a job in their field of study.
Ashutosh Ukey, a 23-year-old who recently received his master's from the University of Illinois Urbana-Champaign, told Insider he turned down multiple Ph.D. offers to work for Coinbase. His was one of many offers rescinded by the crypto company shortly before his start date, and now with just five months left before his visa expires, he needs to land a new job quickly or will be forced to leave the country.
"For programmers who need visa sponsorship, there's a lot more on the line," he said. "It's not just a financial or career setback; it's a question of whether you can even stay in the country. There's a lot more pressure to try to find a new role in time."
To make matters worse, Coinbase had promised new hires their jobs were safe just two weeks earlier, saying via email that the firm was "extremely excited" to have them join and would not be rescinding any job offers. So it was a shock when over 300 Coinbase new hires later received a mass email saying that because of "rapidly changing market conditions," the firm was rescinding their job offers.
"I was hearing all this news that crypto was crashing," another new grad who asked to remain anonymous because he wasn't authorized to speak with the press told Insider. "But I got an email with Coinbase telling me to not worry and that everything was fine. Then literally, shortly after my birthday, I get an email saying my offer was rescinded. I made a lot of plans that are in ruins now."
New engineers say that rescinded offers are wearing down their faith in the tech industry
Especially in a time when tech is battling both a downturn and a talent shortage, some prospective engineers have lost trust in the companies that have pulled the rug out from under them.
Hungry to recruit new talent, many companies wooed new grads with lucrative packages. One new grad who asked to remain anonymous because he wasn't authorized to speak with the press said he turned down offers from Meta, Amazon, Tesla, and TikTok to work for Coinbase, which offered him $188,000 and, more importantly, the option to work from wherever he wanted as an entry-level engineer.
His offer was also rescinded just as he was about to graduate. And while Meta and Tesla were aggressively hiring in the beginning of the year, both companies had shut their doors — pausing hiring indefinitely — when he tried to get back his offers.
"I was getting interviews from TikTok, Tesla, Amazon back in December," the new grad told Insider. "But now job hunting is lot harder. Everything's died down. There's a lot less job listings and less recruiters."
Many new grads and interns Insider spoke with said this recent episode in tech's seemingly indefinite downturn had shaken their faith in the industry. Landing that first job as an entry-level engineer requires months of work — studying questions, juggling multiple recruiter calls, poring over LeetCode to nail the notoriously intimidating technical interviews.
"This experience taught me that you are never guaranteed a job," the new grad who had his offer rescinded by the e-commerce company where he interned told Insider. "A contract means nothing because companies are more than happy to drop you in a heartbeat if it means they have to do it for the company."
For some new grads, this is valuable time they cannot afford to spend. Ukey said that he used to be excited about exploring experimental and innovative areas in tech, like crypto and blockchain. But while many crypto startups have tried to recruit him since Coinbase rescinded his offer, he's decided that crypto isn't a risk he can take — at least not for the immediate future.
While rescinded job offers are not a widespread cost-cutting practice, new-grad roles are vulnerable when a company tightens its belt, Jay Denton, the chief analyst at the compensation-data firm LaborIQ, said.
"When a company is growing a lot, they hire a lot of new grads because instead of getting someone with four to six years of experience, they can hire new grads who cost 15 to 20% less," Denton told Insider. "Yet when it comes to cost cutting, if you look at today's market rate, there's almost a 10% gap between today and last year's market-rate pay for engineers. So instead of hiring someone brand new at market rate, many companies are choosing to focus on retaining old hires if they could."
In addition to employee trust, the mass of rescinded offers might also shape company loyalty for the new class of tech professionals just entering the workforce. Employee loyalty had already declined during the "Great Resignation," when employees had more leverage, and now the increasingly turbulent job landscape has the potential to chip away at that even further.
"I used to be really excited, but now I realized I can't make work my entire personality," one new grad told Insider. "It has definitely made me a lot less loyal."
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