A look at tech recruitment issues as the US unemployment rate for tech workers is 1.7% and 0.2% for cybersecurity experts, well below 4% for the general economy
Recruiters in tech are desperate for workers. But candidates are the ones who hold all the power.
Context & Ripple Effects
In early 2022 the US tech labor market was at its tightest on record: tech unemployment of 1.7% and just 0.2% for cybersecurity specialists, against roughly 4% economy-wide, meant recruiters competed for a pool with almost no slack. The demand side kept climbing — Indeed.com showed US developer job postings up 120% on the pre-pandemic baseline by mid-2022 developer job postings up 120% on the pre-pandemic baseline.
That peak now reads as the top of a cycle. Employment in tech occupations hit a record 6.39M in November 2022 even as layoffs began record 6.39M tech employment in November 2022, and by 2025-2026 DOL data shows the market loosening sharply, with IT unemployment falling from 5.5% to 4.5% as postings declined IT unemployment falling from 5.5% to 4.5% and later ticking up to 3.8% amid AI uncertainty IT unemployment rising to 3.8% amid AI uncertainty. The candidate power described here was cyclical, not structural.
First-order effects
- Tech and cybersecurity candidates could dictate terms in early 2022 — recruiters faced bidding competition for a cybersecurity talent pool that was effectively fully employed at 0.2% unemployment.
- Employers competing for scarce security and engineering staff absorbed higher compensation costs and slower time-to-hire as the default cost of doing business.
Second-order effects
- Companies priced out of the talent auction were pushed toward non-wage levers — remote flexibility, faster offers, and poaching from adjacent sectors like banking, retail, health care, and manufacturing, where laid-off tech workers later clustered.
- The acute cybersecurity shortage gave security specialists outsized leverage, forcing firms to build or buy talent pipelines rather than assume hires would appear.
Third-order effects
- The subsequent swing — record employment coexisting with layoffs, then unemployment rising toward and past 4% as postings fell — shows tech labor demand is cyclical and sensitive to macro and AI-driven uncertainty, meaning the 2022 candidate's market was a peak, not a permanent regime.
- Firms that built structural responses to the 2022 shortage (internal training, broader sourcing pools) were better positioned for the looser 2025-2026 market than those that simply outbid rivals.
The trend: Tech labor markets cycle between acute candidate power and employer power, with the 2022 shortage peak giving way to rising unemployment and declining postings by 2025-2026.