‘Students are frustrated’: College seniors seeking tech jobs face a chilly hiring market

The signs of trouble are easy to spot at University of California at Berkeley, usually a hotbed for tech recruiting. 

• Some of the Big Tech companies have pulled out of recruitment and branding partnerships they previously had with the campus career services office.

• It’s taking longer for students to land jobs. To make themselves more marketable, some students are doubling down on courses in AI and data engineering, two areas that haven’t been hit as hard as others in the tech industry. 

• Meanwhile, many students are applying for jobs at smaller companies now that Big Tech’s Google, Amazon, and Facebook-parent Meta have cut tens of thousands of workers over the past two years. 

“Students are frustrated,” Santina Pitcher, senior associate director of employer relations at U.C. Berkeley’s career center, tells Fortune. 

The unease among job seekers is being felt across the country. Once a sponge for new graduates, the tech industry has cut back on filling high-paying jobs and is far more selective.

So far this year, tech companies laid off nearly 140,000 workers, according to Layoffs.fyi, a website that tracks job cuts. That’s on top of more than 264,000 people cut from tech last year. 

Things won’t necessarily get better anytime soon for college graduates. Silicon Valley is increasingly using artificial intelligence to help software engineers speed up the process of writing code, reducing the need for hiring more programmers. 

In a potential sign of the shift, job postings for software engineers have fallen more than 160% since post-pandemic hiring peaked in March 2022, according to data from Indeed, the online job board. That’s a far bigger drop than for non-tech roles.

In response to the souring market, young professionals are seeking tech jobs outside the usual suspects, such as with small businesses and government, according to new data from Handshake, a recruiting site for college students. It found that 42% of today’s computer science students have applied for full-time jobs at small businesses, up from around 25% in 2022. 

Of any college major, that’s the largest jump in interest in small businesses, defined as having 250 workers or less. Such companies may not have the perks of bigger ones like ping-pong tables and offsite retreats at wellness ranches, but they can offer more stable roles and a direct social impact on local communities, Handshake’s report notes. 

Another report by Handshake in May found that the Class of 2024 is applying to more government jobs. About 7.5% of job applications from new grads were for public sector work, up from 5.5% for the Class of 2023.

Overall, the job market is relatively strong. The U.S. added 254,000 jobs in total in September, according to federal government employment data. The gains were largely driven by hiring in the education and health sectors, leisure and hospitality, and government. In contrast, the information services sector, which includes the tech industry, grew slowly, contributing less than 10,000 jobs last month. 

At Berkeley, the shift in the tech industry is having a big impact. The number of employers showing up at STEM-major career fairs has remained relatively stable since the pandemic at around 100. But aside from Alphabet’s self-driving car unit Waymo, Big Tech is absent. Instead, the sponsors include Bloomberg and TikTok, along with the U.S. State Department and the Peace Corps. 

“I’m seeing more interest from startups and smaller companies, and the bigger ones are backing off a little bit,” Pitcher said.

At Carnegie Mellon University, in Pittsburgh, a similar trend is playing out, said Kevin Collins, associate director of the campus career center. Students must work harder to land roles than they did before the pandemic. His advice: Look beyond the usual online job boards, attend networking events, and be more open minded about employers. 

“They’re still doing tech roles, but they’re doing it in different industries and smaller companies in general,” Collins said.

Carnegie Mellon is known for strong robotics and computer science programs, and its graduates have historically been snapped up by the likes of Google and Uber. This year it topped College Transition’s list of schools that feed talent to Silicon Valley. 

And while there are still opportunities for new grads in Big Tech, Collins said, huge West Coast tech companies have scaled back their once aggressive campus recruiting efforts since the pandemic. Instead, some tech students are taking jobs in traditional industries, like financial services, he said.

“It’s probably a healthier market in the sense it is broader,” Collins said.

Madeleine Brutin knew the job market would be competitive when she started as a Carnegie Mellon student in 2022. The day she got her university email address, she says she messaged the career services office. As a freshman, she’d already heard from upperclassmen about the competitiveness of the job market, as companies rescinded offers amid post-pandemic downsizing.

Searching for a full-time position is still stressful today, Brutin said.

“You can go months or days without hearing from a company, and you’re at a fork in the road where you’re wondering should you apply more? Should you build more skills? Or should you just keep waiting?” she said. 

Brutin, who studies computational finance, looked beyond the Silicon Valley “pure tech” companies. While still job hunting, she already secured an offer for a full-time position at Bloomberg after previously interning there.