‘A huge windfall’: Automakers look to hire tech talent from job cuts in Silicon Valley
Silicon Valley's loss will be Detroit's gain as automakers transition into high-tech companies and as talented people who will design and operate the new "computers-on-wheels" flood the current job market.
Technology titans Google, Amazon, Microsoft, Meta (Facebook's parent) and others have already laid off — or are in the process of doing so — about 70,000 employees in a year's time due to economic uncertainties and slower growth, according to a CNBC report.
All this newly unemployed tech talent spilling into the market offers General Motors and Ford Motor Co. a fortuitous opportunity to lure talent to Detroit, people who might not have previously considered the Motor City, analysts told the Free Press.
"Two years ago, a software developer or engineer in Silicon Valley was not taking GM’s call," said Dan Ives, managing director and senior equity analyst at Wedbush Securities. "Today, they are actively looking to work at GM. GM has fully bet on their electric vehicle future and under the hood they are a very mature company that is essentially an entrepreneurial startup-like in spirit."
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GM confirmed to the Detroit Free Press on Tuesday that it is easing up on its previous hiring freeze to take advantage of the new tech talent available.
"While this isn’t a major growth year from a hiring standpoint, we’re continuing to hire tech talent," said GM spokeswoman Maria Raynal. "This includes some of the talent in the market due to the tech downsizing, particularly in areas such as EV development, software development and defined vehicle." A defined vehicle uses software to operate.
GM is not alone in its hunt for talent. Ford has been recruiting tech talent since last year when its CEO, Jim Farley, said the automaker will need to hire a different kind of talent than what it has traditionally recruited. In 2022, Ford tapped Jennifer Waldo from Apple to head human resources because of her experience leading organizational change and recruiting talent for high-tech jobs. When asked whether Ford would pursue any of the soon to be laid-off tech talent, Ford spokeswoman Marisa Bradley said in an email to the Free Press, "We continue to have opportunities for top technical talent with deep knowledge and experience in software development to join Ford as we scale our connected and electrified offerings."
A breakout of the GM openings
GM's Raynal said "defined vehicle" jobs are those involved with software-operated vehicles.
"Previously, the driving experience depended primarily on the hardware of a vehicle," Raynal said in an email to the Free Press. "Now, as the industry moves to electric and autonomous vehicles, it relies largely on software development to create the technology, apps and over-the-air updates. Many of our openings in recent years have been in this area of the business."
Analyst Ives said his research into Silicon Valley shows that for every 10 people laid off by the tech companies, one or two will move to jobs in other "transformational industries" including electric carmakers, in part because there is a global shortage of talent for such high-technology jobs as those industries grow.
"We’re seeing GM aggressively go after engineer and software developers from the Valley ... to build out the EV business in future years," Ives said.
A search for "information technology" jobs on GM's career website shows 479 matching jobs at GM facilities around the world, including those in Michigan. A search for "software developer" shows 367 jobs. A search for "EV development" showed 397 jobs. A search for "defined vehicle" showed 360 jobs, including internships. It's hard to provide a total number of openings from these figures because some job descriptions in the search results overlap.
Raynal said GM has about 1,000 open positions globally, and they are predominantly tech positions.
'A huge windfall for Detroit stalwarts'
But GM is no stranger to aggressively recruiting tech experts.
In 2018, CEO Mary Barra started to actively tout the benefits of working for GM to the nation's top tech students at Harvard University, MIT, Boston University, Georgia Tech and Virginia Tech.
GM hired 3,000 new salaried employees in 2020 and hired 10,000 more people in 2021. In early 2022, GM said it looked to hire about 400 software specialists among more than 8,000 people across various technology teams and other areas of the company. But in May, GM put its hiring plans on hold, telling the Free Press that the company was ahead of schedule in its hiring having already brought in 7,000 new salaried workers. Nearly all of this hiring was connected to the transition to a zero-emissions vehicle lineup by 2035, essentially making GM an EV software company.
The hiring freeze continued into August, when GM reiterated that it was being "prudent" in hiring only for jobs that are critical due to economic uncertainty. GM has said it will not have to do any layoffs to save costs — unlike crosstown rival Ford, which cut 3,000 salaried jobs last summer.
Ives said even if GM were to remain conservative in its hiring this year, Barra is an "opportunist" who will not likely allow a chance to recruit exceptional talent to slip through her fingers for long.
“GM is not just sitting by watching the clock tick; they will use this as an opportunity to take more steps ahead,” Ives said. “It could be a coup for them to get some significant talent. It’s a huge windfall for the Detroit stalwarts.”
But how much does Detroit need?
Financial adviser David Kudla, who is founder and CEO of Grand Blanc-based Mainstay Capital Management, agrees. He said that GM and Ford have become increasingly technology-driven companies as they move into EVs and autonomous vehicles, noting that "the massive layoffs at the big tech giants provides talent the automakers can attract. They have already done so in some areas."
But how aggressive the automakers may be going forward is unknown, Kudla said, noting that GM and Ford "have a tremendous amount of in-house talent already working on these technology programs.”
Similarly, Morningstar auto analyst David Whiston said the technology layoffs are "probably" an opportunity for carmakers depending on the talent breakout of who is being laid off in the tech sector.
"The other variables are: Is the Detroit Three willing to spend money on people despite recession fears? Can you convince tech people to join the auto industry and on top of that possibly move to Detroit?" Whiston said, conceding that some automaker jobs exist on the West Coast and Texas, possibly making relocation unnecessary. "And, how much need is there at the Detroit Three, given their tech hiring the past few years?"
Despite the questions, Whiston admits that even if Detroit's automakers don’t see a huge need to hire more tech talent at the moment, "I’m sure they’d be interested in people with specific skills or those that are the best-of-the-best. But it takes time to find those people, too. So, hopefully, they can strengthen their EV, AV, software talent base."
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Contact Jamie L. LaReau: email@example.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.
This article originally appeared on USA TODAY: GM looks to hire tech talent from massive job cuts in Silicon Valley