What next for Ireland's laid-off tech workers

While it remains a candidate's market, few can expect the same salary and work benefits they once enjoyed

Layoffs across Meta, Twitter, Microsoft, Salesforce and most recently, Google will result in combined Irish job losses of over 1,000. Photographer: Leah Farrell / RollingNews.ie

Widespread layoffs afflicting Ireland's tech sector have continued into the new year, with the world's largest companies implementing major restructuring plans to curb falling demand.

Layoffs across Meta, Twitter, Microsoft, Salesforce and most recently, Google will result in combined Irish job losses of over 1,000, with the real number considered to be significantly higher with Stripe, LinkedIn and Amazon yet to announce how their layoffs will impact the Irish labour market.  

Worsening macroeconomic conditions has resulted in a notable slowdown in business activity that now spread beyond just the tech sector, with half of all Irish businesses considering reducing costs and a third considering reducing their headcount, according to professional services firm, Aon. 

Despite Aon's cautionary forecast, research from the European Commission found that tech cuts are having "no visible impact" on the Irish job market, with the Minster for Enterprise, Simon Coveney assuring that Ireland has already seen the worst of the sector's layoffs.

"This is a correction in the tech sector but it is certainly not a crisis," said Mr Coveney. "I can assure you when the tech sector starts to grow again it will probably be growing out of Ireland rather than anywhere else."

However, while the cuts may not spark a tech sector crisis, Ireland's economic outlook has become clouded with further uncertainty while already grappling with energy costs, rising interest rates and the cost-of-living crisis.

Despite recent layoffs being heavily concentrated in the tech sector, engineers, computer scientists and other core employees were largely retained, according to leading recruitment agencies, with the majority of laid-off workers coming from talent acquisition, human resources, marketing and sales. 

"A lot of the displaced workers that have been made redundant were in support roles, much more so than from the core engineering side," Trayc Keevnas, Global FDI Director at Morgan McKinley Ireland said.

Right now, those who have been let go are still sitting on redundancy packages, according to Ms Keevans, however, few can expect the same salary and work benefits they once enjoyed.

"A lot of the workers are laying low at the moment, some are taking it as an opportunity to emigrate, but those who do choose to stay and work in Ireland will likely find a new job, probably from a smaller company or SME, but the benefits will not be as lucrative," Ms Keevans told the Irish Examiner.

"What we are seeing is a misalignment between these workers' expectations and what the market is actually paying. While it's still very much a candidate market on the core tech side, employers are pulling back a little bit in terms of the salaries they're willing to pay, and that spreads beyond just the tech sector."

"Another example is contractor salaries - usually, we see these increase year-on-year by roughly 5%, but we have not seen that happen this year."

While jobs may not be scarce for these displaced workers, many are laying low to "recharge the batteries" after working so long in what can often be a fast-paced environment, according to Clare McDonald, Commerical Director of IT recruitment consultants, Stelfox.

"In situations like these, we always see people take time out, but a lot of people are taking this time to upskill too."

While Ms McDonald has not seen the same impact on worker pay, she says that employee benefits have become "more sophisticated than ever," and while some employees can't necessarily have the salaries they want, they may be able to gain access to further benefits.

Among younger laid-off workers, the prospect of emigrating has become significantly more attractive, according to Ms Keevans. 

"This is something we are seeing across every sector, but for those leaving what would have been their first job, they're taking this opportunity following the pandemic to emigrate, which is definitely a challenge."

While the worst of Ireland's layoffs are considered to be already behind us, Ms Keevans warns that 2023 will see a notable lull in tech market activity, saying, "While I don't see many more redundancies coming, hiring will also be flattened." 

"Employers will have a lot more caution this year and the roles that are added will be critical value positions."

Despite these lulls, the candidate market remains strong, says both Ms Keevans and Ms McDonald, with labour shortages and a skilled workforce still highly favouring employees, giving Ireland's competitiveness an edge on other countries.

"The proportion of those laid off in Ireland has been considerably less than those in any other location," says Ms Keevans. "That is because of the quality of talent we have here."

"If tech companies do have to make more tough decisions, Ireland will not be at the top of the queue."