It has become a regular affair. Almost every day we hear about another Israeli high-tech company that is laying off workers, usually a few dozen. In recent days it has been Elementor, Open Web and Cognate who have joined the list of savers. At the same time, other high-tech companies, including international giants, are reducing recruitment and sometimes stopping them altogether, in a declared or unofficial manner.
The Israeli high-tech market has suffered in recent years from a chronic shortage of workers, which stemmed from a demand that exceeded supply. Have the layoffs and recruitment stops changed this reality? To test this, we went back to the start-up of the grocery deliveries Abu, which fired most of its 350 Israeli workers last month, and examined what happened to the fired ones. The results showed that in the core areas of high-tech the demand for workers is still very high despite the atmosphere of crisis all around. Even companies that have experienced sharp falls in the stock, such as Inshortech Hippo or Gaming Playtica, continue to absorb employees. Of course such positive momentum can change at any moment.
Marketing workers and customers are still looking for work
The layoffs in Abu came in two waves: In early May, the company laid off 500 workers in Israel and around the world in order to return to its original focus – supplying concentrated deliveries to workers in office buildings – after Corona expanded supply to residential buildings in Israel and the US. Slow down the cash burn and avoid closing.
Although the layoffs only took place last month, a survey conducted by Globes through the LinkedIn network found that a respectable number of laid-off Abu workers had already found their way into a new job. Out of a sample of more than 80 Israeli workers, who indicated on LinkedIn that they had left the company in recent months, more than a third of them (about 36%) had already posted online that they had been hired for a new job.
The list of companies in which the listed are absorbed is very diverse and includes mainly Israeli private start-ups such as Taylormed, Trigo, Claudinary, Riverside, Upplayer and Rewire, but also a number of Israeli public companies such as Hippo, Autonomo, Playtica and Monday and foreign companies such as Zoom Info. Some of the employees were absorbed in companies outside the high-tech field, such as the logistics company Oriane. Two dismissed facts even managed to set up an event production company.
The fact that over a third of the laid off workers have already found work can be considered positive evidence that the demand for workers in the high-tech market remains high, but it should be taken into account that there is a significant difference between the workers in the various fields. Not surprisingly, the employees who found work most quickly were those who engaged in the areas of product, development and data analysis. According to a Globes survey, workers in these positions have been abducted and most of them have already been hired for a new job. Most of the human resources, recruitment and staff positions included in the sample of fired Abu have also indicated that they have already found a new job.
However, when it comes to employees in the fields of marketing and customers, and even more so among employees in the worlds of operations and logistics, the trend is the opposite – the vast majority of them are still in the status of searches on LinkedIn. Of course there is also the possibility that workers in these fields are less likely to update their status on a new job, compared to development or human resources workers, which adversely affects outcomes.
“Companies called almost non-stop”
Tal Gruper, director of the Abu development team, was on a honeymoon abroad during the first wave of layoffs in Abu. “Even though I did not signal that I was leaving the job, only the announcement of the dismissals caused the recruiters to contact me.”
When Gruper called his manager from abroad he found out he was not fired. But two weeks later, in the second wave, he also terminated his employment. Specializing in cyber defense for the automotive field. “I’m not some crazy talent and we’re in a less good time in the market, but they still called me almost non-stop. “I did not even have time to answer everyone,” says Grupper. “My conditions improved in relation to Abu.”
According to Grupper, among the fired employees and managers, local initiatives have arisen to assist in writing resumes and preparing for job interviews. Two of the five developers on the team who worked under Gruper have already found a new role and the rest are not really stressed either. “There are those who take finding work lightly and look with tweezers for managerial positions, even if they have no managerial experience. Anyone who is experienced is bombarded with offers and improves conditions. However, juniors are harder to find and they are more apprehensive.”
Lior Nahum also lost her job in the second wave of layoffs. To understand its role in Abu, one first needs some explanation of the company model. Abu’s unique model is based on concentrating deliveries of employees in the same office or tenants in the same building, in what is supposed to lower costs for everyone. Abu signs agreements with a company or building and then tries to persuade the tenants or employees to actually use the shipments. This is what Nahum’s team, Growth Marketing, did.
She did survive the first wave of dismissals, but as mentioned, in the second she was fired. “The truth is that after the first change, I believed that we would be able to grow and that there were professional and quality people in the company who could succeed,” says Nahum. “When we were informed that we were fired, everything happened quickly and we did not get to work the next day. In total, I worked for seven months, but in my start-up life it’s a lot.”
Abu provided its employees with a springboard
Like many of her friends in Abu, Nahum immediately went on to post on LinkedIn with a description of her new status as a job seeker, which led her to her new job as VP of marketing for the Onto restaurant ordering app. One of the respondents was the head of my department in Abu Shafran and wrote very flattering things. “Whoever saw it was the CEO and one of the founders of Ontofo who approached me privately. I came to the meeting and then to another meeting and I was accepted. For me it is a role that is an upgrade.”
According to her, some of her friends in Abu have already been absorbed in a new job and others are currently in intensive processes. “I’m not surprised that the company’s employees received a lot of offers because Abu chose the people with tweezers. This is a company that provided a springboard in terms of learning work methods and project management.”
A slightly different story is the story of Dana Herman, who worked as a recruiter in Abu. In amusing timing she resigned just before the wave of layoffs, in favor of a new role in the recruitment of the crypto-defense startup GK8. Still, she managed to experience with her friends the recruitment of the layoffs. “There is a very high demand for recruiters and everyone who wanted to stay in the field got a lot of options. I think senior executives have a harder time finding work. Some executives also experienced a sense of shock from what happened in Abu so it’s hard for them to jump straight to the next position.”