The key insight this week
In the first half of 2022, startups on Carta collectively hired 314,000 new employees.
In the first half of this year, that number fell to 129,000. And there are more startups using Carta these days.
Sneak peek at a chart from our upcoming State of Startup Compensation report (headed to this very inbox on September 19th). We'll dig into everything happening with startup salaries, equity packages, and the like. But it all starts with the labor market.
Clearly, the current hiring market for startups is stuck in the mud. Any month where the orange dashed line in the chart is above the hiring black line, that means net headcount across Carta's startups fell. Before this year, it had never fallen for more than 1 month consecutively. Unfortunately it's fallen for 5 out of the 6 months to start 2023.
(Caveat - we do expect our hiring data to rise a little for May and June as we get some late-arriving data, but point holds).
Obviously while layoffs (green line) remain elevated, I'd expect hiring to remain muted. It will be fascinating to see if startups remain this committed to efficient company building once the fundraising market bounces back (guessing Q1 2024, but that's a real guess).
Will the advent of AI permanently reduce headcount needs across startups? Will startup employees be more reluctant to job-hop after the frightening past year of layoffs? Will founders starting this year and beyond view company size in altogether different ways than prior founder cohorts?
Lots of questions, no good answers - yet.
But we'll dig into some of the most relevant data on the startup labor market next week. If you have burning questions around compensation, reply to this newsletter and I'll see if we can get them in the queue for a future compensation event!
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Peter Walker
DISCLOSURE: This communication is on behalf of eShares, Inc. dba Carta, Inc. ("Carta"). This communication is for informational purposes only, and contains general information only. Carta is not, by means of this communication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services nor should it be used as a basis for any decision or action that may affect your business or interests. Before making any decision or taking any action that may affect your business or interests, you should consult a qualified professional advisor. This communication is not intended as a recommendation, offer or solicitation for the purchase or sale of any security. Carta does not assume any liability for reliance on the information provided herein. © 2026 Carta. All rights reserved. Reproduction prohibited.
