“Last year smaller companies were at a disadvantage as they could not compete with big corporates in hiring talent. This is great opportunity for SMEs to get high skilled talent,” said Vinay Mahajan, National President, ITServe Alliance, an association of 1800 small and medium size US companies.
There are no numbers available for how many of the laid off workers would be H-1B or L-1 visa holders with estimates putting it between 3,000 to 25,000. The provisions of the H-1B visa require the person to find a new job or sponsor within 60 days of being laid off, failing which the person would have to leave the country.
According to staffing firms, demand for tech jobs still remains high in the US, only that this demand is coming from non-tech companies like retail, financial services firms and transport, among others.
“Most staffing firms provide high-skill tech talent to non- tech companies, and that demand is still there,” said Prabakaran Murugaiah, chief executive of IT staffing portal techfetch.com.
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While he expects this wave of layoffs to continue till the end of the first quarter, there were still a large number of vacancies in tech roles in the US. Several of these firms are hiring these H-1B visa holders as many of them have the skill sets and experience that is needed by these non-tech companies to implement their projects.
In some cases It may require some degree of compromise, whether on salary or location or job description, but there were jobs available in spite of the spate of layoffs.
Over the past 12-18 months, tech companies were hiring in large numbers and at elevated salaries, which made it hard for smaller companies like staffing firms. Deepali Khadakban, CEO, Precision Technologies.
She said that they were hiring ‘aggressively’ and had doubled in the last two years. “There is a supply crunch when it comes to tech talent and we continue to see high demand for contractors,” she said. Given the flexible nature of the subcontracted workforce, companies continued to turn to staffing firms as it helps them manage cost and meet the demand for talent to fulfil their project obligations.
Experts said that this round of layoffs was a correction to balance the exuberance in hiring through the last few years of the pandemic. As recessionary fears kicked in, companies started to let go of people, even though demand hasn’t dropped significantly, they said. Staffing firms work in gaps between projects where they can deploy talent into their business model, and even demand may slow down for a short while, they will be the first to see the signs of an upswing.
“Once these (tech) companies start hiring, they are likely to turn to staffing firms first, before hiring full time workers,” said Murugaiah.
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