TC&MN #3 Strengthening Your Career and Finances: Preparing for an Economic Downturn

More Turbulent Times Ahead, and This is Normal.

I know the news cycle is all doom and gloom. However, this is a normal reset in tech.

Having personally entered the job market in 2001 (crickets anyone) and going through the great recession of 2009 working for a high-risk start-up. What is happening presently is normal. You need to look beyond the headlines and get a feel for what is happening.

This isn’t the end of tech jobs, it is just a reset.

Tech jobs are projected to grow at a macro level this year by a modest 2%, even with the layoffs. Cybersecurity roles are projected to grow by 35% this year alone.

So why the layoffs?

You need to be aware of two dynamics in tech companies if you are playing the game to build personal wealth.

1.) Many tech companies are not profitable for many years, even when they are public. (i.e. Meta, Uber and Spotify). If a company is not profitable, then when there are headwinds, it will need to reduce the amount of dollars it is spending to stay alive, meaning it will cut jobs.

2.) Hyper-growth tech companies hire ahead of need because of the talent war. Companies hire ahead of new initiatives before they become profitable. During an economic downturn, these companies will shed employees and expenses.

Working for technology companies is risky, so be aware of that and plan accordingly.

Don’t fear the risks. Plan for them and have tactics to mitigate them. 

Three Actions to Prepare Your Career for a Recession:

With a recession looking imminent, here are three straightforward steps that you can take to prepare your career for a downturn. These same steps have helped me and others navigate previous ones. So they work!

1.) Prepare your resume, LinkedIn, and storytelling to attract new opportunities.  

To attract new opportunities, keeping your LinkedIn profile and resume updated with your latest role and achievements is crucial.

However, don't rely solely on these documents; instead, focus on telling your career story effectively to highlight your value and secure what you deserve.

Not you, though. You read Tech Careers& Money News!

Be able to tell your career story in a concise way that articulates your value. Of course, what we do is a team sport. However, you must communicate your value to get what you are worth!

2.) Build leadership and essential Skills.

As I mentioned in our first newsletter, all companies need great leaders, and they are in short supply.

If you want to make yourself essential and have employers pursuing you, build core leadership skills.

• Self-Awareness - the foundation of effective leadership

• Communication - convey your thoughts and ideas clearly

• Influence - the ability to motivate and inspire others

• Decision making - gather information, weigh options, and make sound decisions

• Growth mindset - ability to adapt and learn in rapidly changing environments

Find courses that can help you build and grow these core skills. Even an individual contributor can benefit from having these skills as we all need to manage up to our leaders.

3.) Understand who is hiring for your role now

You need to analyze and understand the market value for your role and skills. Research companies hiring for your exact or adjacent role and evaluate their requirements to enhance or add to your current skill set.

Understand the demand for your role and what skills are sought after.

If your company is burning a lot of cash and is expense-heavy, start taking interviews and meeting with recruiters.

Keep your eyes open for great opportunities, in the middle of this cycle some companies are doing very well and you won’t hear about them in the news cycle.

There are great opportunities even in a storm.

Don’t wait; be proactive!

Financial Preparation for a Recession

While not a comprehensive list, here are three things you should do to prepare for a recession.

1.) Evaluate your emergency fund

Here is a simple framework for funding an emergency fund. Nothing is perfect, but having a framework can guide you.

2.) Eject all unnecessary expenses or luxury items now

It is so easy to add one subscription after another with a click of a button. Or maybe you were one of many who purchased a new RV during the Covid-19 pandemic. But all of these items add waste to your budget if not managed.

Ultimately, you need to spend below your means and take time to eject things that are not providing value or joy.

Take time to Marie Kondo your expenses and rapidly remove things weighing you down to save more. Eliminating these expenses now will be a big relief later.

Here is a link to the Financial Detox Process laid out in last week’s publication.

3) Ensure all diversification and risk levels are acceptable to you

Having been invited to look over the shoulders of many tech employees ’ portfolios, one big issue I consistently observe is the lack of diversification. Many tech employees own too much stock in their current company or one they have just left.

Lack of diversification can create a lot of risk. When concentrated on a single asset, your financial future is tied directly to it. During a recession, asset prices get pushed around, creating stress and ulcers. Evaluate what levels of diversification you need and move towards that.

At the end of the year, set aside time to review your investments in detail and make a plan to get your portfolio or portions to an appropriate risk level.

While taking time for finances during the holidays can be challenging, you must stay on top of them to prepare for the following year.

While you and your family want an enjoyable time together now, don't mortgage your future happiness by not addressing something important today.

Tech Equity and Money Talk is a weekly podcast showing you how to work for tech equity as a wealth-building strategy and meet your financial goals.

/030 🎙️ 031: From PhD to Tech Leader: Unveiling Leadership Tactics in Big Tech

Why do talented people go to big tech first instead of a start up?

How do you grow from an individual contributor to managing teams of 100s?

What is the future of AI in tech?

Curious? – brace yourself for an exciting interview with Ritendra Datta, who was an engineering leader at Google, Meta, and now Databricks!

Bake Some Bread to Chill Over the Holidays

Holidays can be massively stressful!

Not only is the end of the calendar year (and for some fiscal year) approaching, but there is also a packed calendar of events, planning, and children’s expectations to manage.

To find some quiet space in your head, bake some bread ← , Yep; I rhymed it.

Back in 2020, our non-Marvel Universe Blip where we were sent to other parts of the multiverse. My mutant superpower that evolved was the control of flour and yeast with the ability to push it into an oven and produce some smoldering hot goodness.

I am not lying when I confess that I was baking two loaves a day in the spring and summer of 2020. While my family loved it, my waistline is still recovering.

Turns out there are some key reasons why Baking is so relaxing,

 Here are three ways that it can help you de-stress:

1. The repetitive motions of kneading, mixing, and shaping dough can be very soothing. The rhythmic movements can help to take your mind off of your worries and focus on the task at hand.

2. The sensory experience of baking bread can be very grounding. The smell of the warm bread baking in the oven, the feel of the dough in your hands, and the sight of the loaves rising can all help to bring you back to the present moment.

3. Baking bread can be a creative outlet. Baking bread offers endless possibilities for experimentation with different types, techniques, and shapes. This creates self-expression and stress release.

You can feel a sense of accomplishment and pride when you pull that loaf out of the oven, and the smell takes over your kitchen. I suggest baking during this season to combat feelings of stress, anxiety, and depression.

The easiest way to start is with soda bread or biscuits because you don’t need yeast or let it rise.

Irish Soda Bread Recipe - From Basic Ingredients to Loaf

Drop Biscuit Recipe - Your family will thank you!

Enjoy!

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Disclaimer: This newsletter is for informational purposes only and does not constitute financial or career advice. Always consult with qualified professionals before making any decisions based on the information provided.