The US startup job market kicked off 2024 with a whimper.
Hiring across the 43,000 Carta startups has remained weak to start the year. And while layoffs have receded slightly, the number of employees leaving by choice has also declined.
Chart below looks at all employees leaving startups each month since January 2019. The ratio is between employees leaving by choice (black line) and those who were laid off (orange line).
Back in pre-pandemic times, a normal ratio was about 80/20 - that is, 80% of employees leaving every month were doing so of their own volition.
Things got even more employee-favorable in 2021, when startups jobs were plentiful and the Great Resignation ruled headlines.
Since the start of 2023, the ratio has been basically even. Not great.
𝗥𝗲𝗮𝘀𝗼𝗻𝘀 𝗳𝗼𝗿 𝘁𝗵𝗲 𝘁𝗿𝗲𝗻𝗱
1. Layoffs, while not at peak, are still happening across startups.
2. Every new hire is being scrutinized much more closely than in prior years.
3. Startup employees are looking at the job market and saying, "no thanks, I'll stay in seat for now".
Incidentally, this dynamic is responsible for a lot of the compensation declines (in equity) we've seen over the past year or so. Comp is very responsive to labor market supply/demand.
One odd thought sparked by this analysis - is it possible that mid-2022 will represent the high point for total startup employment for many years to come? If late-stage startups of today remain cautious on hiring, and the early-stagers coming up do so with lower headcount, I think it could be true.
Sending support to all of you active in the job search across startups right now - it's a tough market 🙏
#cartadata #layoffs #hiring #startups #labormarket
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