Why Twitter, Redfin, Coinbase are rescinding job offers

Yahoo Finance's Allie Garfinkle joins the Live show to break down the reasons why Twitter, Redfin, Coinbase are among the latest companies to rescind job offers.

Video Transcript

BRIAN CHEUNG: Well, unusual activity in the labor market as companies start to rescind job offers at a high rate. Workers apparently getting caught off guard, especially in tech. Yahoo Finance's senior tech reporter Allie Garfinkle in studio with the latest. Allie, this stinks, first of all, for people, I imagine, that are getting these job offers. But who's doing this? And why is this happening?

ALLIE GARFINKLE: So first things first, Brian. Rescinded job offers are very uncommon. Of all the HR experts I talked to, they all said that this rarely happens, if ever. And when it does happen, it happens in extreme circumstances. So this is really rare. And it's happening at three companies right now-- Twitter, Coinbase, and Redfin. And it's been happening a lot. And it's been really meaningful I think also that it's been happening in tech because it means that people are even more caught off guard. This is a sector that's seen massive expansion.

AKIKO FUJITA: I mean, with that said, there's sort of two storylines happening. On the one hand, we've heard about these major tech companies saying we're going to pull back on hiring. And yet we're still hearing that the tech demand, whether it's for engineers in software-- I mean, that is still there. So have you spoken to people who had their offers rescinded? And are they finding other jobs waiting on the other end?

ALLIE GARFINKLE: Yeah. It seems contradictory, right, Akiko? On one hand, you keep hearing the labor market's really tight. That's what the data keeps showing us. But you hear about these rescinded offers. I actually spoke to a gentleman for this story who had offers rescinded from both Coinbase and Twitter. He was actually choosing between the two companies. And what happened is within a span of about two weeks they both rescinded those offers.

And he was-- the thing that's also really important is, A, it's not happening to just people who are just leaving college. I think that's a misconception. In this particular case, he was actually a pretty senior executive. Are they finding jobs? The answer seems to be yes. Everyone I've talked is going on a lot of interviews. There is still demand for their labor. It's kind of just a weird situation that sort of keeps playing out over and over.

BRIAN CHEUNG: Yeah. And I guess what this might entail is the larger trend where as we start to get a little bit closer to perhaps a recession, you're starting to see some of these high-growth companies say, we're going to pull back on these job postings. And maybe a victim of that are people that are just almost across the finish line on some of those postings. I mean, how much of this is tied to the overall story that we're hearing at tech companies of we're just going to pull back on some of these ambitious projects or moonshot things that we were going to staff up for because we got to prioritize on cash flow right now?

ALLIE GARFINKLE: I think that's really perceptive, Brian, because I think they are completely inextricably intertwined. You have this moment where VC funding is really hard to come by, stocks are down, everybody is kind of in a moment where they're scared and need to tighten their belts. So despite the fact that the data from even a month ago, two months ago shows that the labor market is tight, we are in a very specific moment that's been playing out for the last couple of weeks. And I really do think that it is completely connected. High inflation and the broader macroeconomic climate.

AKIKO FUJITA: Well, and the thing we keep hearing is that just hold tight right now. So it doesn't necessarily mean these jobs are not going to come back. Maybe six months down the line those offers may be there.

ALLIE GARFINKLE: And that's what these people are hearing too. Keep applying. Keep putting your name out there. Someone will hire you soon.

BRIAN CHEUNG: Could be a hiring freeze instead of just full on axing it entirely. Yahoo Finance's Allie Garfinkle, thanks so much for the breakdown there.