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Was there a tech-hiring bubble?

Indeed.com job postings data suggest so

We recently discussed Information industry jobs data from the U.S. Bureau of Labor Statistics: That post showed that layoffs in Information were elevated relative to layoffs for non-farm employment overall. Today we examine job postings data from Indeed.com to answer a related question: How have the help wanted ads in the US tech industry compared with the rest of the labor market?

The FRED graph above taps into a recently expanded dataset from Indeed.com to compare changes in the level of job postings for the tech industry with changes in the level for all job postings. The black dashed line shows the indexed trend of all job postings; the red line shows the trend of postings in information technology operations and helpdesk positions; and the blue line shows the trend in software development job postings. These daily data are reported as an index with a value of 100 on February 1, 2020, and represent changes in the level of postings relative to that date.

The graph shows that the overall level of job postings declined during the onset of the COVID-19 pandemic, bouncing back to pre-pandemic levels 12 months later. Soon after, and while help wanted ads for IT operations and helpdesk staffing remained depressed, the level of job postings in software development started to quickly outpace the rising national trend.

At their peak in late February 2022, help wanted ads for designing computer applications or programs more than doubled their February 2020 level. In contrast, IT operations and helpdesk staffing roughly kept up with the national trend. Over the past year, the decline in software development job postings has been swift and, again, has outpaced the gradual decline in overall job postings.

Finally, other datasets from the same source show similar ups and downs in other countries around the world (see here and here). So, although the data from Indeed.com is not as comprehensive as the BLS data, they suggest a large-scale cycle in tech industry employment is over.

How this graph was created: Search FRED for “Software Development Job Postings on Indeed in the United States.” Next, click the “Edit Graph” button, select “Add Line,” and search for “IT Operations and Helpdesk Job Postings on Indeed in the United States.” Repeat the last step to add “Job Postings on Indeed in the United States.” Use the “Format” tab to change the lines style and color.

Suggested by Diego Mendez-Carbajo.

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