Tech hubs look to the next chapter amid growing layoffs

All eyes are on the state of once-booming tech hubs given the recent flood of tech layoffs and the rise of remote work. Bloomberg declared San Francisco is “showing signs of life” while the Wall Street Journal noted the city’s real estate market is picking up even with all the layoffs. 

Office occupancy trends are important indicators of a city’s economic health. San Francisco, at just 45% office occupancy after companies like Slack announced plans to get rid of their headquarters, make some people think a comeback is far off. 

But there’s some hope for metros like San Francisco as workers look for new opportunities. As my colleague Michal Lev-Ram recently reported, laid-off workers are still in high demand, but not by the obvious suspects:

“There’s another type of organization that’s attracting some of the laid-off tech talent: tech companies that don’t often make headlines. They’re big, but their lower profiles can make it more difficult to compete for talent against buzzier names in social media and fintech. ‘I’m hearing a lot of interest in places like Intuit and Adobe,’ says Jana Rich, founder and CEO of Rich Talent Group, an executive recruiting firm, referring to the tax-software maker and the company behind tech tools like Photoshop.”

It’s companies like these that are catching the eyes of many freshly laid-off workers like Ashley Davis, who was a recruiting coordinator on contract at Google’s Austin office for nearly two years until she was let go as part of her company’s recent job cuts. 

Her layoff came as a surprise. One day her lead told her she was doing a great job and to keep it up and the next morning she couldn’t log into her devices and was only notified of the layoff via email later in that afternoon. “I won’t say it didn’t sting,” she said. 

But when I talked to her this week, she was feeling optimistic, and she believed that everything would work out. Davis told me that she had always wanted to work in tech, and her passion started with an internship at LinkedIn before her freshman year of college. Her plan is to stay in Austin, even if it means switching from a high-profile tech firm to a quieter one, or even a startup. It’s a tradeoff she’s willing to make to continue a career in tech and stay in the city she’s called home for years. 

Many others could be on the same track. As Wired noted this week, some of the most well-known one-time startups like WhatsApp, Square, and Slack emerged during a recession. And even in Big Tech, there are some signs of future hiring. Construction filings earlier this year show Apple intends to build a $240 million development in Austin, and earlier this week, Tesla announced plans to open new engineering headquarters in Palo Alto.

“I’m looking at it as just the climate right now, but I know it won’t always be that way,” Davis said. “And I think lots of reorganization is happening, things are shifting. So therefore a lot of companies are just like, ‘Let’s just lay people off.’ But they still need people to do those jobs, and they’re still going to come back, just painted a little differently.”

If Austin and other cities want to keep their momentum as tech hubs, they will need to retain workers like Davis. After all, tech hubs face increasing competition. Since the pandemic, many smaller cities have attracted legions of techies who have switched to remote work. Smaller cities are also benefiting from the many non-tech companies that are stocking up on tech workers, who were once difficult-to-attract but are now hunting for jobs.

Want to send thoughts or suggestions to Data Sheet? Drop us a line here.

Andrea Guzman

NEWSWORTHY

Dubbing comes to YouTube. To help creators reach viewers who speak other languages, YouTube started offering tools Thursday that let them make audio dubs on new and existing videos. The video platform said that during tests, multilanguage dubbed videos saw more than 15% of their watch time coming from views in the video's nonprimary language. On an average day in January, viewers watched more than 2 million hours of dubbed video daily. One of the early testers was MrBeast, who said it “supercharges the heck out of the videos.” He’s now dubbed his most popular videos in 11 languages and is hoping to bring more international viewers to his main channel.

New rules for Facebook jail. Users of Facebook and Instagram can violate content policies up to seven times without being banned and receive an explanation each time about the violation. But on the eighth offense, a user’s account will be suspended. Meta announced its policy change on Thursday, saying it would prevent “overpenalizing” people when they have abided by Meta’s content regulations and lead to “faster and more impactful action.”  

Missing evidence. U.S. Justice Department lawyers have accused Alphabet’s Google of destroying internal communications, Reuters reports. Google refuted the allegations and noted that it had produced more than 4 million documents for an antitrust case that is aimed at its search business. Still, the government's lawyers asked a federal judge to sanction Google.  

The Online Safety Bill’s threat to encryption. Businesses focused on providing encrypted communication are worried a bill going through the U.K. Parliament could require that they weaken the privacy of their messaging systems. Signal president Meredith Whittaker told the BBC that the company “would absolutely, 100% walk” if the bill called on them to make such adjustments. While the government said it’s not a ban on end-to-end encryption, some leaders say that encryption slows the war against online child abuse.

FOOD FOR THOUGHT

Who will be PayPal’s next CEO? Earlier this month, CEO Dan Schulman said he would retire at the end of the year. A senior analyst at Mizuho Securities USA said PayPal needs a big brand name replacement to fight the perception that the company is a “melting ice cube.” Since PayPal’s upcoming investor day could be a soft introduction, Fortune compiled a list of people, ranging from the heads of Pinterest and Nextdoor, who may be good candidates for the job. 

From the article: 

Given that Schulman is sticking around through December, the search is still in the early stages and PayPal’s board has yet to engage an outside search firm, Fortune has learned. But there is already plenty of chatter about who PayPal could—or should—approach. To compile our list of possible contenders, Fortune spoke to private equity executives in the payments space, CEOs of rival companies, analysts, and venture capitalists. Our list is meant to include executives that might be considered for the role—but that of course doesn’t necessarily mean that they’d take it if offered.

IN CASE YOU MISSED IT

Elon Musk’s Twitter hasn’t been paying its rent, now one of its landlords has defaulted on its loans, by Christiaan Hetzner

CashApp and Square push Block’s year-over-year gross profit up 40% as Bitcoin sales lag, by Ben Weiss

The ‘free money’ tech investment is over and the ‘old economy’ is set to become the big winner, according to Bank of America, by Will Daniel

‘Even an emoji is better’: LinkedIn users tire of ‘commenting for reach’ replies, by Steve Mollman

America’s most expensive zip code is taking a stand against ultrawealthy NIMBYs like Steph Curry and Marc Andreessen—in the smallest possible way, by Alena Botros

Sam Bankman-Fried and FTX straw donors made tens of millions of dollars in illegal political contributions, DOJ alleges, by Leo Schwartz

SEC insists Elon Musk still needs a ‘Twitter sitter’ to monitor his posts about Tesla, by Chris Morris

BEFORE YOU GO

Reclaiming the throne. With 382 million followers, singer Selena Gomez is now the most followed woman on Instagram, beating out media personality Kylie Jenner. For a while, she had the app deleted from her phone because of the anxiety she experienced from reading comments. “People can call me ugly or stupid and I’m like, Whatever. But these people get detailed,” Gomez told Vanity Fair. “They write paragraphs that are so specific and mean. I would constantly be crying.” Two days ago, however, she was all smiles in a picture posted on Instagram, sipping on a drink with a caption saying she’s taking a break from social media. Holding a record number of followers and likes have continued to be status symbols over the years. In December, Lionel Messi’s World Cup photos became the most-liked Instagram post, taking the spot from a photo of a brown egg that had garnered 57 million likes after being posted in 2019.