Startup employees are in The Great Stay era - but it's been a wild 7 years.
The data below looks at a simple ratio: number of startup employees who left their jobs by choice vs the number who were laid off or fired.
This ratio is a decent signal of how confident employees are feeling about hopping to a new job. Obviously that confidence is affected by many things: layoffs, hiring rates, startup fundraising, valuation overhangs, on and on.
𝟮𝟬𝟭𝟴-𝟮𝟬𝟭𝟵: 𝗣𝗿𝗲-𝗣𝗮𝗻𝗱𝗲𝗺𝗶𝗰
About 4 employees left by choice for every 1 that was laid off in this period.
We can assume this is a good "normal" rate (although perhaps bumped up a little by very low interest rates).
𝟮𝟬𝟮𝟬: 𝗣𝗮𝗻𝗱𝗲𝗺𝗶𝗰
Very few startup workers left their jobs by choice for a 8 month period. Layoffs were sharply up and then non-existent by later in the year.
𝟮𝟬𝟮𝟭-𝗘𝗮𝗿𝗹𝘆 𝟮𝟬𝟮𝟮: 𝗧𝗵𝗲 𝗚𝗿𝗲𝗮𝘁 𝗥𝗲𝘀𝗶𝗴𝗻𝗮𝘁𝗶𝗼𝗻
Confidence was at record highs, job hopping was common, felt like everyone had 3 offer letters in Silicon Valley.
𝗠𝗶𝗱 𝟮𝟬𝟮𝟮-𝗠𝗶𝗱 𝟮𝟬𝟮𝟯: 𝗠𝗮𝗷𝗼𝗿 𝗟𝗮𝘆𝗼𝗳𝗳𝘀
Interest rates changed, layoffs struck Big and Little tech alike. Job hopping retreated as employees hunkered down.
𝗠𝗶𝗱 𝟮𝟬𝟮𝟯-𝗡𝗼𝘄: 𝗧𝗵𝗲 𝗚𝗿𝗲𝗮𝘁 𝗦𝘁𝗮𝘆
Layoffs are thankfully come down (though not entirely gone). But startup employees are still very reluctant to leave their current jobs.
This reluctance is down to a) fewer jobs available, b) a preference for stability, and c) worry that if they join a new company they may be first in line for any eventual layoffs down the road (sadly this is kinda true). I'm sure there are d, e, and f reasons as well.
Will startup employees regain the confidence of 2019-era workers anytime soon? Or will they remain cautious as hiring continues to be sluggish through the end of 2024 and into 2025?
Not sure. But this willingness to jump to new jobs has major impacts on employee compensation and general hiring trends across US startups.
#startups #startupjobs #founders #venturecapital #layoffs
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