The Talent Crisis Impacting Silicon Valley

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I spent the last week in Silicon Valley talking with lots of companies, friends and colleagues about the topic of talent management, or more specifically, the workforce challenges in the valley.

Many friends attending the Web. 2.0 Expo this week, are hearing many of those same concerns and challenges from startup companies regarding a current a “talent crisis” in the Bay Area.

Two areas that were highlighted as key challenges…

  1. Finding engineering talent. Many startups are facing a challenge hiring talented engineers beyond the founding team. The reason being…those talented engineers can either go become a founder or live a happy life and make a nice handsome salary at Google. Many startup companies stated having 50% open requisitions and the inability to fill them in a timely (less than 90 days) fashion.
  2. Motivating employees. As one startup CEO suggested, his engineers only want to show up at work and write code all day in the corner. Many of his engineers are emotionally withdraw from the success or failure of the product. Engineers performance should not just be measured how fast they can write code!

Ironically, I attended my father’s retirement party this past weekend. We spent alot of time discussing workforce demographic challenges the many issues facing the baby boomer generation. Of course, I had to ask if he planned to re-enter the workforce or even consider working part-time in a consulting role. His response….”hell no”. Guess he needs to get his money worth with the golf cart.

  • http://woodrow.typepad.com/the_ponderings_of_woodrow Jason Wood

    Jason,

    First of all, congratulations to your dad on his retirement. My father retired and I asked him the same question, he replied in similar fashion and has held steady 7 years later.

    Second, I think this speaks to a broader issue of demographics related to talent management. Why shouldn’t more startups be doing great things in other areas? In tech development, there’s absolutely no reason a company HAS to be in the Valley.

    Much the same as New York. Why are there 100x the number of hedge funds in NY than anywhere else? Because history dictates NY is the place to be. But that’s silly. With travel, telecommuting, the Internet…no reason you couldn’t run a successful asset management business just about anywhere these days.

  • http://www.chipoverclock.com Chip Overclock

    I doubt seriously that, if this is a real problem and not just a short-term blip, geography has much to do with it. It may merely manifest soonest and strongest in Silicon Valley as do all things tech. The Boomer retirement wave, the lack of perceived glamour in tech careers, and the fad of forced ranking and other arcane HR trends may all be coming home to roost. After years of hearing my former employer imply “You may just not be good enough to work here”, I decided they were right. There are better things to do with my life, particularly given the immense cushion of my retirement funds I’ve been paying into for thirty years. U.S. companies must now depend on outsourcing and offshoring, and must face the fact that they may no longer be able to retain the intellectual property that is between the ears of their increasingly temporary employees. On the other hand, I have to believe that in the longer run there will be a market adjustment as a result of this. These kinds of things are frequently cyclic.

  • Jason Corsello

    Chip – Great point. Most Silicon Valley companies, though, are ill-fully prepared for upturns and downturns of these cycles. Why is it that HR, or whatever we call HR next, is the last thing staffed at startup companies?

  • http://www.timecentre.com Alex Ross

    With all of the technology today and coders wanting to be coders, why should demographics in play a role in a company? If you want a talented employee, don’t limit your search to a 50 mile radius of the company building. There is a plethora of ways to create an effective virtual office to allow communication around the world. From Skype to webcams to SharePoint, there is a way to bring talent together.

    Where I work, TimeCentre, we have executives in Atlanta, sales team in Denver, and developers in India and Australia. We are able to communicate with each other and accomplish all the tasks on hand.

    There is a generation gap and as the next generation moves into the executive roles, we will see a new type of corporate culture emerge.

  • http://www.facebook.com/benchewSG Ben Chew

    Nice article write-up! Asia is also facing the same challenges and that is exactly what Startup Jobs Asia is looking to work along with.

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