Oleksandr Lytvynenko considers himself lucky. As tech workers faced layoffs in the past year, Lytvynenko started his first technology job in October.
He’s now a junior software engineer apprentice at Alethia Software in Colorado Springs. If he does well, he’ll get a raise that’ll pay him more than his last job as a barista at Starbucks, where he toiled for three years to save money. He couldn’t afford training or a degree, that seemed a standard requirement for many tech job openings.
“Without any degree that is connected to tech, it’s hard to prove that you can be a valuable employee to a tech company,” said Lytvynenko, who is from Ukraine and felt the language barrier made a computer job a better fit. “At Starbucks and any other job in customer service, it’s like a dead-end job because you can’t move in your career. You only have a couple of options.”
Lytvynenko qualified for free tuition at a 15-week computer-engineering training program run by Activate Work, a Denver nonprofit. Starting pay for software engineering gigs is around $56,000, according to the organization. But for Lytvynenko, it’s about more than just the pay. It’s an entry point into what has eluded him since moving to America: a fulfilling and prosperous career. But while he graduated with an apprenticeship, he knows it’s still tough out there. As of a month ago, he was the only one in his cohort to get hired.
“Most companies don’t understand the concept of apprenticeships,” said Lytvynenko, who’s 32. “In my city in Ukraine, it was a small city, I think the same size as Colorado Springs, but it was a hub for IT companies (and) all of the companies, they had apprenticeships and they even had their own schools. They guaranteed a place for the best students.”
For years, tech firms have complained of labor shortages. But many required applicants to have a degree, credentials and experience. Last decade, coding bootcamps proliferated to meet demand but the pricey programs struggled to place inexperienced workers. Many have called it quits. Now, pandemic overhiring has companies from Amazon to Zillow cutting jobs, while others like Zulily are closing. Tech news site TechCrunch’s layoff list is now at 240,000 jobs lost in 2023, which is 50% higher than a year ago. Some layoff trackers put that number even higher.
And yet, talent is still hard to find.
In an August report by Deloitte Insights, nearly 90% of leaders surveyed said hiring talent was a “moderate or major challenge. “In fact, we really want to improve our security and take it to the next level, but we aren’t getting enough talent.”
Where is the tech talent?
There had to be a better way, thought Helen Young Hayes, who founded Activate Work in 2016. Back then, the U.S. was dealing with a high-tech sector projected to add 1.1 million new jobs by 2026 to the existing 14.5 million, according to U.S. Bureau of Labor Statistics data.
Hayes doesn’t come from a tech background. She’d been semiretired for years, having left the finance world in her early 40s. The Yale University graduate had made a name for herself in the 1990s as a portfolio manager at Janus Capital in Denver overseeing billions of dollars in investments.
Shaped by her childhood growing up as one of the few Asian families in Starkville, Mississippi, in the mid-1960s, Hayes lives her life with purpose because she really shouldn’t be alive. In 1989, she survived the United Airlines Flight 232 plane crash in Sioux City, Iowa, that killed more than 100 people. After leaving Janus in 2003, she stayed in Denver and focused on her family. She became a philanthropist, served on boards and volunteered for socioeconomic causes.
“I was growing increasingly impatient with the reality that many well-intentioned programs serve the same people over and over again,” Hayes said. “And I was getting frustrated with the intransigence of poverty, with how sticky poverty is. It seems to me incredibly un-American that poverty should be a life sentence. And for so many, if you’re born into the wrong ZIP code, you have almost no chance of moving up into the next quartile of socio economic strata.”
She’d ask her friends at the organizations why was it so difficult to move people from economic struggle to economic freedom.
“And the answer was, ‘Because we don’t have access to the resources that the CEOs, the companies, the businesses, the jobs, the income, the wealth, the employment,’” she said. “And I’m like, ‘You know what, I’m going to stop complaining about this problem and stop being critical and actually roll my sleeves up because I think I can come up with a better mousetrap.’”
Activate Work aims to level up motivated people who want to improve their skills and get to a better place financially. It could be folks who never went to college, older workers who are seeking a career change, or people who can’t afford to take time off to learn new skills. In 2020, Activate teamed up with information-tech-training provider Per Scholas for coursework and last year, it switched its focus entirely to high-tech training and connecting grads to entry-level jobs and apprenticeships.
Even with the past year’s layoffs, computer jobs are projected to be the nation’s second-fastest growing occupation through 2032, due to the “increase in the number and severity of cyberattacks and data breaches on U.S. businesses,” feeding demand for information security analysts, according to a BLS report.
Jobs are purportedly available, with many of the 250 business executives surveyed by MIT Technology Review Insights saying a shortage of candidates is a top concern. But there was also a familiar reason why: 64% felt tech job candidates “lack necessary skills or experience.”
Everyone is just competing for the same limited pool of talent and part of that is because of this historical habit of hiring people with a four-year college degree rather. … I will call those unnecessary credentials
Helen Young Hayes, Activate Work founder
Here’s the thing, Hayes said. The tech workforce may not be growing as much as one would think, even with efforts to widen the potential workforce by attracting more women, more people of color, more veterans and more people without a college degree.
“The problem historically has been that the tech industry has tried to solve their talent shortage by accelerating the velocity with which they’re hiring people that their neighbors have hired rather than expanding the overall workforce,” Hayes said. “Everyone is just competing for the same limited pool of talent and part of that is because of this historical habit of hiring people with a four-year college degree rather than looking at alternative and creative ways to get people the credentials that are required to do the job. … I will call those unnecessary credentials.”
Most cybersecurity employers didn’t want “newbies,” according to a 2019 Lightcast (formerly Burning Glass) report. Some 88% of job listings required bachelor’s degrees or higher and three years of experience. If the data is accurate, that leaves just 12% of companies that might consider hiring a coder fresh out of bootcamp. Or a midcareer job seeker who volunteers with their church’s website. Or a barista with an aptitude for computers.
Activate wants to find those workers and train them. But it needs employers to step up and take a chance on the new talent. That mission resonated with Christie Frieg, founder of Alethia Software, which hired Lytvynenko a few months ago. She’s not been disappointed.
“My vision for our company is in every way that we can help give a leg up to people who are disadvantaged and who are looking for a fresh start, especially people who have a drive and are really willing to work hard and really want to succeed,” said Frieg, whose 12-employee firm in Colorado Springs develops software for space systems. “They did a good job equipping (Lytvynenko) for the workplace and we’re looking forward to more apprentices as we grow.”
Colorado IT agency ditched degree requirement
At the Colorado Governor’s Office of Information Technology, it’s long been a challenge to attract and retain tech workers. The office, which employs 1,100 people, often competes with higher-paying tech companies and other private employers.
“We aren’t able to offer stock options and bonuses and things like that that the private sector can offer,” said Bob Nogueira, OIT’s chief people officer. “But we can offer a culture that is based on service. And that culture, I believe, is really what keeps people here.”
The agency’s move to become a remote-first workplace, which began just before the pandemic, helped retain staff. But also helping attract newcomers? Changing its hiring practices last year after the governor’s executive order to consider skills and abilities — rather than a college degree — became a baseline requirement for a job.
“What we’ve done now for nearly all of our positions is we’ve eliminated the requirement for a degree,” Nogueira said. “We also have a specific statement on our careers page that encourages folks to look at all of their experiences. A quick example is if someone is maintaining the website and building applications for their place of worship and they’re not getting paid for it but are a volunteer, that’s still a great experience. That’s a great skill that we want to know about.”
OIT uses Activate Work as its apprentice partner since the agency doesn’t have its own program. Because of Activate Work’s mission to reach into parts of the Colorado community often overlooked, the state is able to expand its workforce while new hires build more economic stability.
Like Sarada Nookala, who has a bachelor’s degree in mechanical engineering from a university in India. But since she didn’t work right away, it proved challenging to find a technical role a few years after graduating and even more so two decades later — where the 43-year-old mother of two found herself about a year ago, as a bagger at King Soopers.
“Everywhere, the question mark would be, ‘How many years of experience do you have?’ If you’re not fresh from graduation, you will not get many opportunities,” said Nookala, who became a stay-at-home mom and now lives in Fort Collins. “Even two years after my graduation, it was a big minus that I wasn’t working immediately after graduation.”
She, too, trained in Activate Work’s software engineering program and OIT hired her as one of its three current apprentices. She’s an apprentice developer.
“This is opening my door because OIT has taken the initiative. I (wish more) big organizations would take the step” into apprenticeships,” Nookala said. “After a year of working, I’ll be more confident to apply for other jobs.”
Tech hiring is cyclic
In the U.S., the number of job postings is down 15% from last year, as of Dec. 8, according to job-board Indeed.com. But within the tech sector, software development job listings are down 51.3% from a year ago, information design openings are down 44.3% and IT operations and help desk gigs are down 33.%, according to Indeed data.
Likely reasons, according to Indeed’s 2024 hiring trends report, are that the openings have been filled or eliminated. Companies reconfigured staffing needs due to concerns of high interest rates and a slowing national economy. Or, as many are now saying, businesses over-hired in the pandemic and have cut staff to meet more modest goals.
“The pullback in job postings has been most stark in sectors tied to previously high-flying industries, including tech, where stock valuations have fallen and hiring plans have returned to earth,” according to Indeed’s report.
Colorado has fared relatively better than the nation, and other states considered competition for talent. As of Dec. 14, Colorado’s job postings in the past year have fallen on Indeed by 12.6%, while Texas is down 13.6%; Florida, down 16.3%; Washington, down 20%; California, down 21.5%%; and Utah, down 23.1%%.
The pain can be felt at tech-training programs that have been around for the past decade. Turing School of Software and Design, a Denver coding program founded in 2014, had its second round of layoffs last month, halving its staff in a year. In August, the decade-old Ada Developers Academy, a tuition-free software bootcamp for women and underrepresented minorities in Seattle, laid off more employees and paused admissions, tech site GeekWire reported.
The economic environment has also been felt by Activate Work, which has 40 employer partners. Several have a hiring freeze though many expect to lift them in the first half of next year, Hayes said.
With her background in finance, she’s seen the ups and downs of the economy and this feels the tech industry will recover again. She’s in it for the long haul to build an actual pipeline of workers with the training companies need and widening the potential workforce that is overlooked.
“Right now, there’s a little bit of indigestion going on in the industry. But the overall need is a long-term strategic view to growing the IT workforce,” Hayes said. “We really need to grab the workforce and stop competing with one another for an overly small pool of talent.”