Surviving the downturn

By Jim Grey (about)

For years there have been more jobs than people in our industry, and supply and demand kept driving salaries up. But now across the industry there have been layoffs. I imagine you are feeling uncertain and insecure now. That’s normal and natural. I feel it too.

In our industry, security is illusory. Every software company is always one or two bad quarters away from a layoff, or worse.

Here’s a story of this in the extreme. In 1997 I joined a software company that made an ERP system for small and mid-sized manufacturers. It was a wonderful place to work. Sales were fantastic, and we grew enough over the next three years that we IPO’d. I was granted 30,000 stock options and dreamed of an outcome that would pay off my house.

Then the dot-com bubble burst, and September 11th happened. The bottom fell out of the entire software industry – nobody was buying software. That company had layoffs every quarter, and my turn finally came. My stock options had become worthless. 

But worse, I had kids to feed and a mortgage to pay. Industry jobs were scarce. Through a lucky break, I landed an individual contributor role on a software team at a very large health insurer. The culture there was terrible, but the pay was surprisingly good and I could take care of my family.

The last time I found myself involuntarily without a job was in late 2018. I saw signs it was coming, and I was worried and anxious. I wasn’t even happy there! But when it happened it was still a loss, and nobody likes to lose. Also, I’m not wealthy; I needed those paychecks. 

I had been Director of Engineering there, and the best job I could find in time was an Engineering Manager for a large, slow software company with a bad culture and ancient technology. I gritted my teeth and got on with it, for my bills weren’t willing to wait for me to find a better job.

What I’ve had to do – and what I encourage you to do – is become comfortable with the uncertainty inherent in our industry. But also, know that the overall trajectory of the industry is strong. It has recovered powerfully from every dip – we are in the third one in my 34 years in the industry – and is very likely to keep doing that.

If you just can’t find a way to get comfortable with our industry’s inherent instability, consider finding work at a big insurance company or bank. A whole bunch of developers and testers I worked with at the health insurer 20 years ago are still there. 

To make yourself more able to pull through downturns, focus on things you can control. A long time ago I learned about The Three Freedoms, and leaning into them has helped me find a new job faster when I was out on my ear:

• Freedom skills – Make sure that you can do things for which there is demand. I know an engineer from that ERP company who never moved off that company’s core technology, which was a language called Visual FoxPro. Never heard of it? That’s because nobody’s used it in 15 years. He has made himself irrelevant. 
• Freedom contacts – Build your network in the industry. I could write a whole article about this one topic. But in short: Stay in touch with good people you’ve worked for and with in the past. Ask them to introduce you to people they know but you don’t. Make a regular habit of having coffee, lunch, or beers with these people. Then when it’s time for you to find a new job, you can contact all of these people, who can keep their ears to the ground for you.
• Freedom money – Save powerfully. If you have six or 12 months of living expenses in the bank, losing your job is not a crisis. This also lets you quit a situation that is bad for your mental health.