10% unemployment yet every startup in NYC struggling to hire

http://jonsteinberg.com/15-unemployment-yet-every-startup-in-nyc-is-s

by jonsteinberg • 16 years ago

116 174 16 years ago

kls• 16 years ago

I still say, the tech market reigniting and the quantitative easing are strangely well timed. I have to wonder if the tech market is being inflated, because it is the one market that has not suffered decades of neglect. It could be a good thing, as the world does need investment in technology if we are going to hit the next whatever revolution now that the information age looks to be at the least maturing, investments in science seem to be the natural course to bring on the advancements for the next age. Unfortunately some of those ages dawned with investment in science for less than peaceful purposes. So if the industry is being inflated, then I supposes it is better than massive investment in military spending to bring about the next age.

OzzyB• 16 years ago

"There's a massive misalignment between the labor pool and the job pool, and I blame our undergraduate institutions"

I don't, I just think the Rent Is Too Damn High.

http://www.rentistoodamnhigh.org/

huangm• 16 years ago

Actually, the price of good engineers being high + high unemployment speaks precisely to a misalignment of supply/demand.

itg• 16 years ago

The skills he mentions in the article should be taught on the job, not in college. The other problem I noticed, especially when it comes to fresh undergrads, is some companies want people who already have some exact skillset yet don't want to do any training of their own.

_delirium2• 16 years ago

This is one of the things big engineering firms in other areas do better, I think (though they do some things worse). A company like Boeing doesn't expect you to come out of college having exactly the skills needed to design a 787 or run a wind-tunnel test. Partly this is out of necessity, because they use a lot of in-house software packages, equipment, and proprietary methods that your university couldn't teach you even if they wanted to. So they focus more on whether college graduates have a solid grounding in engineering principles, rather than whether they know how to work exactly the stuff Boeing is going to want them to do.

Similar story at petrochemical firms; my dad is a process engineer mainly for PTA- and polyethylene-manufacturing units, and they surely don't expect most incoming hires to know how the PTA synthesis process works, or even necessarily to know what PTA is (it's a chemical used to make polyester). They just expect a general chemical-engineering background; they don't want to have to teach the entirety of what engineering means, what process modeling is and how you might use it, what debottlenecking is, etc., but they don't expect incoming knowledge to be very specific.

krschultz4• 16 years ago

Working for one of the big defense contractors at the moment, they definitely prefer to hire fresh grads. They will burn 6 months of you being completely unproductive on their dime to train you in the blink of an eye. Thats $50k to them before you even did anything. Plus they have a process for everything and have experienced guys holding your hand and checking your work.

They also figure once you start out there with good pay you will become out of touch with the market rate, and they raise you extremely slowly compared to the market, so that by the time you have been there 5 years you are a bargain to them. Most people just don't keep enough connections outside the company and are incapable of moving on.

So they look at the total cost over 5, 10 years+ and hiring a bunch of new grades and training (even paying for grad school) is cheaper for them.

Startups don't have that luxury. 6 months from now, we might be out of funding. And if we care about what happens 5 years from now, we're super rich. So lets hire better people first. And they don't have the luxury of a fixed process and senior engineers to check everyones work.

wyclif• 16 years ago

Yes, you hit the nail on the head. Nobody in the Valley or NYC wants to train employees, they only want fully-formed engineers right out of school. This is a huge problem because a convincing argument can be made that CS programs don't teach programming-- they teach computer science.

There were a couple of submissions here in the past about a certain UK firm-- name escapes me now-- that takes Oxbridge grads in English and other liberal arts with no programming experience and trains them. I understand they are very successful in developing productive employees. Anybody remember the name of that corp.?

bugsy14• 16 years ago

I agree, and I'd like to clarify that when we are talking about training it's not about learning how to program. It's about being OK with hiring a developer who is expert in C++, LISP and Haskell, and being able to say, hey, it's OK he doesn't know PHP because it will only take him a weekend to pick it up. The training of talented developers is self training, but sometimes they do appreciate the company providing or covering the costs of the books they'll need.

jonsteinberg5• 16 years ago

I'm a big believer in self-study and self-training. Meetups, books, on-line study - I've personally done it all.

With that said, schooling at all levels, even when liber arts and fundamental, prepares people for the world they will work in. At the most basic level, writing and math prepare students for the workforce.

I'm simply arguing that we swap out a lot of industrial and unnecessary coursework (i.e. Latin) for technical thinking, examples, and coursework.

jrockway6• 16 years ago

It's because "every startup" is lazy and afraid to take risks. In the programming world, for example, everyone wants to hire someone who has 150 years of experience with each of C, C++, Java, C#, Perl, Python, Ruby, OCaml, Haskell, and node.js. Problem is, that is not possible. So the position goes unfilled.

If programming shops were willing to hire people fresh out of college with English degrees and teach them programming, they would probably do really, really well. But nobody is willing to do that, so college grads go without jobs and startups go without employees.

(Also, startups expect you to really drink that Kool-Aid. They want you to work 12 hour days, skip weekends, not take vacation, and "be loyal" to the company. Why would anyone do that when they can work 9-5 for 4x as much money at an investment bank?

Ironically, even the investment banks can't hire anyone, but that is for other reasons.)

mgkimsal9• 16 years ago

That's another really good point. There's not much in the way of apprenticeship in software.

Companies will often pay for relo expenses for someone, providing they stay for X years (else they repay the relo money back). Companies could do something similar with education, whether it's local college classes, inhouse training, etc. If you leave within the first year, you pay the company back those expenses. Or... have retention bonuses for people for staying past 1 year, and invest in education for people at lower wages. Many companies would find some real gems out there, waiting to be discovered, and would engender far more loyalty than most currently get.

sleight423• 16 years ago

There are small startups that will hire entry-level people. However, I agree, the relationships with the entry level people are not necessarily of the mentor-apprentice variety.

mashmac2• 16 years ago

The university I attend, Taylor, just began a track in their Computer Science major a few years ago designed for this exactly. It lets students work in a team atmosphere, and get a few major projects under their belt before they graduate, with critiques and advice from professors. I have a few friends who chose that track and are learning how programming really works, getting a little bit of class credit, and getting an on-campus work study job out of it as well.

bugsy14• 16 years ago

I'm not sure I am following this. If you want to attract actual talent, you have to pay full relocation. The good ones have stable jobs they enjoy. And they are going to pay their own relocation for a new job that may not work out? I don't think so. The only people that pay their own relocation are the desperate and the completely untalented.

As far as having to pay back if you are laid off or the company is otherwise dissatisfied due to their own lack of having a decent vetting process, ha ha ha. Indentured servitude. That's a new one. I'm sure that will get the best of the best. Not.

physcab2• 16 years ago

I agree with you and generally this is a great way for a startup to save money as well because new grads are cheap.

The problem that you'll then have though, is that when you encounter a tough technical challenge, you won't have the benefit of having someone on your team who has seen it before.

So there must be some golden ratio. A solid emphasis on college recruiting to serve immediate needs, with a focus on building out a technical knowledge base accompanied by many years of experience.

tkaemming• 16 years ago

"I agree with you and generally this is a great way for a startup to save money as well because new grads are cheap."

I'd argue the opposite case — if it's true that a good programmer is at least 5-10x more productive than an average programmer[1], you'd actually save money by paying the experienced programmer significantly more when compared to hiring a team of beginning or average programmers.

[1] http://en.wikipedia.org/wiki/The_Mythical_Man-Month#The_surg...

earl3• 16 years ago

Um... I disagree. I worked for a large company that does just that: hire liberal arts majors with high gpas and teach them to program. It works, well, horribly. Ask any former employee about the code quality at epic systems.

jrockway6• 16 years ago

I work for a large company that hires programmers with many years of experience at prestigious firms and it works, well, horribly. It turns out that not very many people are cut out for programming.

So honestly, I don't think your approach is too bad.

peregrine2• 16 years ago

Epic Systems eh? I heard they were a great place to work?

meterplech• 16 years ago

From what I can see Epic has a landfill of problems that probably aren't related to just hiring liberal arts majors. Moving from that particular example, I think that most startups are not willing to take the risk of hiring someone right of of college who doesn't have an incredible personal portfolio showcased on their amazing website, with years of internships/personal startups.

I agree with the blogpost that colleges aren't doing a good job of transitioning students to the challenges of startup/modern tech workforce. But, it seems to me that the solution would be a number of big employers like Google and others who are more able to take the risks should hire up the most qualified and teach them those skills. Simply, if the undergraduate education isn't good enough, someone's gotta teach em.

27182818284• 16 years ago

It depends on the measure doesn't it? Does it work "horribly" if the company grew from one person to having $600 million in revenue in 2008? I mean it isn't like Facebook success, but it doesn't seem horrible (at least if measured that way.)

maxawaytoolong6• 16 years ago

If programming shops were willing to hire people fresh out of college with English degrees and teach them programming

Body shop consulting firms like Accenture have done this for decades.

kujhytrtyu2• 16 years ago

The clever bit is finding customers who will pay $5000/day for consultants who can just about do intro level MS-Access.

Except for the government of course

jamesaguilar• 16 years ago

Laziness is an important positive quality in a business that already has too much to do. Teaching kids without the disposition or inclination to learn programming for themselves on the off chance a diamond in the rough might be found is not a good business proposition. There's a reason why no one does it. You are far better off just doing less.

rhizome2• 16 years ago

That would be an interesting kind of conservation-minded business: just small enough. Why have a 20 person company doing a variety of things mediocre than a 5 person company doing one or a few things very well? There are larger scale versions of this in the AAA game developer world as the studio model has taken hold.

DevX101• 16 years ago

Right now I'm a one man operation but hopefully I'll have the need to hire after launch. But for a startup I'd never consider taking on an English degree college major and teaching them to program. Marketing, sales, etc..sure, but not to program. If you never got the coding bug by the end of college, I'm sure not going to be spending my time to teach from the ground up.

In a startup every person has to pull their weight and there really isn't time for a formal training. I'd venture to guess that in almost all cases, this new hire will decrease the value of your company as a programmer.

That said, this approach could work at a large firm with stable revenues, a formal training program, and relatively straightforward IT requirements.

jrockway6• 16 years ago

There you go. I didn't say you should do this, I'm just saying it explains the two complaints in the article:

  * Nobody to hire
  * No jobs

sleight423• 16 years ago

I'll add my dissent. I've consulted with 4 different startups in the past few months. And they're not afraid to hire entry level.

However, they seem to run into problems when they want to find senor people to mentor the entry level hires. Entry level developers are rarely able to lead a team much less handle the various technology decisions of the contemporary tech startup.

rhizome2• 16 years ago

Well sure, but they shouldn't have to. That's why it's called "entry level." I've never heard of entry-level management or team leads!

cvg• 16 years ago

Employees should meet companies halfway and learn a bit of programming on their own. Of course learning early on is better, but attempting a pass through something like http://learnpythonthehardway.org should be mandatory for any unemployed person. Shows initiative. A company's apprenticeship program could take the company the rest of the way. A bonus: there are government programs that can help with the cost of this training.

nostrademons9• 16 years ago

The first startup I worked at did this. They hired kids straight out of (or in) high school, like me. They hired recent Indian immigrants who couldn't work anywhere else because of visa issues. They opened an office in Shanghai where they could get programmers for $20k/year.

It worked, well, terribly. The startup folded in a year and a half mostly because of code-quality issues. I remember talking to the founders near the end of my gap year, where they said that of the 10-ish or so high schoolers they hired, only two of us really produced more than we cost (even on our piddly $20-30k/year salaries), and even then we needed a fair bit of management support.

These were also not random people - one of the founders had been a teacher at my high school (he'd been an entrepreneur with a successful exit before then), and he basically skimmed the top of the class off and got them to work for him. Many of us later had successful careers at Google, Bain, or hedge funds.

But there's only so much that you can do to compensate for inexperience. There's a lot that you learn in your first job or two, even if you already know how to program. And until you learn it, there's a good chance that you'll be negatively productive.

samd4• 16 years ago

Perhaps the problem was a poor balance between experienced and novice developers. I wouldn't expect a company with hardly any experienced people to succeed.

scottshapiro• 16 years ago

Great points about the expectations of startups.

However, I've never met anyone below the MD at an investment bank who's working anywhere close to 9a-5p (unless you meant 9a to 5a which is more often the case with analysts).

iskander3• 16 years ago

>If programming shops were willing to hire people fresh out of college with English degrees and teach them programming, they would probably do really, really well. But nobody is willing to do that, so college grads go without jobs and startups go without employees.

Do you have experience hiring someone with no technical experience and turning them into a productive employee? How did you train them? How long did it take?

j_baker• 16 years ago

I don't know about going that far, but I think your basic point is right on. Too many startups expect to have their ideal candidate delivered to their doorstep on a silver platter. Of course, when they can't find that candidate, they blame the education system. Yet I hear very little talk about what startups could be doing to create a better-skilled workforce. It sounds an awful lot to me like they want a skilled workforce as long as someone else pays for it.

Startups have two options: they can choose to be lazy and risk-averse or they can complain about not being able to find workers. They can't do both.

yesimahuman• 16 years ago

I was with you there for a second until you threw out the idea of teaching non programmers to program on the job.

What startups should be more open to is CS types that don't have years of experience in certain languages but have the ability to learn quickly. Too much focus on minor technologies that could be picked up in a few days.

petercooper2• 16 years ago

If programming shops were willing to hire people fresh out of college with English degrees and teach them programming, they would probably do really, really well.

English degrees? The number of English grads I've bumped into in the software industry has been small (in comparison to just how many English grads there are). Math grads would be better since most would have had to do some programming already (even if just in Mathematica). Even physics grads..

fertel• 16 years ago

9-5 at an investment bank - Sure it's 4x the money (or was)- but it's 100+ hours of weekly work that in my personal opinion is nowhere near as exciting as creating new technologies.

jackfoxy• 16 years ago

I just want to hire someone who can demonstrate a level a little beyond competence in database programming, server programming, client-side (js, jquery, css) programming, and understands how the internet works. Most of those people already are gainfully employed. Oh yeah, and they have to be willing to come into our office to work and demonstrate to me they are willing to commit to learning our non-trivial application.

I have a degree in Comparative Literature (which is not an English degree, btw). I would consider someone with a serious music degree, maybe philosophy (e.g. PG). Most liberal arts majors are not cut out to be engineers.

jrockway6• 16 years ago

I guess what I really wanted to say here, BTW, was that I'd rather work with a smart person that doesn't know the particulars for $foo language than I would with a dumb person that has 20 years of experience with $bar framework.

mgkimsal9• 16 years ago

Could it have anything to do with most of them likely only wanting to hire people geographically in (or near) NYC? And hand-in-hand with that, the startups don't really want to pay something adequate for someone with the necessary experience to live modestly within commuting distance?

I know more people who have offshored engineering/dev work to India and the like than send work to developers in Nebraska, Kansas, Alabama, etc. Then they complain about the less than stellar work, with timezone diffs, English proficiency, cultural differences and so on.

There's a pretty large pool of people who are willing to work remote and - gasp - even travel to your main office sometimes, but who simply aren't going to uproot and live in NYC to make $100k. For someone raising a family, they could make $75k in Omaha or Tupelo and have a much better quality of life.

http://www.indeed.com/jobs?q=c%23&l=nyc http://www.indeed.com/jobs?q=java&l=nyc

9400 Java jobs in NYC, but only 900 are estimated at $150k or higher.

Cost of living between Omaha (at 75k) and NYC: http://www.bestplaces.net/col/?salary=75000&city1=531370...

Cost of living between Nashville (at 80k) and NYC: http://www.bestplaces.net/col/?salary=80000&city1=547520...

You need roughly $150k in NYC to have an approximate lifestyle. Yet only 10% of the jobs pay that.

The concept of 'hiring' itself may be due for a makeover, and a 'JIT' approach to company development may be in the cards for companies struggling to hire the right people (which they'll likely lay off the moment things go south again).

mgkimsal9• 16 years ago

Adding on:

We've also had a housing crisis which is keeping many people chained to their current regions due to underwater mortgages and no housing sales. 5 years ago people could move their families across country for a good job. Even if they want to now, they can't. This is just not acknowledged by most companies.

I was approached a couple years ago by a company that was starting up - 'ex google founders' and all that. The product/service was pitched to me as a collaboration/communication tool to help remote teams work more effectively. Sounded great, but I was not allowed to work remote. I had to upsticks and move to SF. To work on a remote collaboration tool. WTF?

nolite• 16 years ago

how did their product end up turning out, out of curiosity?

jayzee• 16 years ago

well in all fairness their product was not developed yet!

nostrademons9• 16 years ago

There really is a huge difference between working in person with someone and working remotely. I've seen misunderstandings that could waste literally weeks of programmer time get corrected by a 15-minute pair-programming session.

It doesn't really surprise me that ex-Googlers would insist you work in person. As a large multinational, Google feels the pain of distributed teams more than many companies, which is probably why they're founding their startup. It'd probably sink their startup if one of their key employees was not working in person with them.

bugsy14• 16 years ago

The underwater mortgages are a very good point. Many engineers bought expensive houses and are now chained to them. It is not unprecedented for companies to cover full relocation, including when necessary buying the dud house themselves from the new employee at a price that allows him to move.

earl3• 16 years ago

This.

All these bloody people play armchair economists with macroecon, which is genuinely difficult, but refuse to do the same with micro:

If you can't hire people at a given wage, raise the wage. Or whine online about the lack of employees.

mgkimsal9• 16 years ago

But if you whine loud enough, you can open more visas for cheap labor to come in next year.

I'm totally not against people coming in to the country - legally. One of my first tech jobs was at a company that sponsored a number of Polish and Czech engineers. They were all effectively captive - they were paid a barely livable wage (relative to US-born people doing the same job) but couldn't easily go out and take another job due to immigration status. But that meant the company 'saved' so much, and could use it to help keep other wages in line - 'you're already paid $x more than person Y!' sort of thing.

mgkimsal9• 16 years ago

"If you can't hire people at a given wage, raise the wage. Or whine online about the lack of employees."

Or move your operations closer to the less expensive areas of the country (there's 48 other states besides CA and NY!).

Some industries are lauded for moving entires factories overseas and making a killing on wage arbitrage. But somehow 'the money' likes to keep 'blessed' startup activity within 10 minutes drive from all VC offices, and this is seen as 'the way things have to be'.

whoover2• 16 years ago

> If you can't hire people at a given wage, raise the wage. Or whine online about the lack of employees.

THANK YOU.

They simply aren't paying enough.

If they pay the same as everyone else, they don't stand out. And they require MORE work than other jobs with the same salary.

If the absolute level of remuneration isn't high enough, people with the necessary skills will just do their OWN startup.

They have to pay enough that the surety of the wage OUTWEIGHS the possibility of striking it rich, for people who could do their own startups.

This is pretty easy to see -- take the founders, and ask them if they'd switch to someone else's company for what they are offering new employees.

Or, ask them if they'd switch their OWN compensation package with whoever it is they are trying to hire.

No, THEY won't work for that little, even on their own baby. So why would anyone else?

Average wage = Average worker

It basically comes down to greed. If they MUST have rock star ninjas, but they REFUSE to pay for it, they aren't serious about succeeding.

If they CAN'T pay for it, then they need to raise money so that they can. If they can't raise money, they aren't any more stable than anyone else's random startup. Why bother working for them at all?

Better to combine salaries to get ONE expert than two or three or four middling employees.

Really the problem is there's too much glorification of FOUNDERS. We see time and time again that they don't have the skills needed to do whatever it is the company is supposed to do, so it's usually the early employees who do it. People think it's their god-given right as a "Founder" with a capital "F" to be king of the hill and get the lion's share of everything, and command an army of peons (who actually do the vast majority of the work) who are obligated to fulfill the "F"ounder's aspirations.

ViaWeb started with the people they needed. It's a lot easier to hire for the non-critical positions.

maxawaytoolong6• 16 years ago

Most startup jobs in NYC pay over $100K if you're an engineer. If you have a family and need a bigger place you can always live in New Jersey. "Money" is not really a problem in New York City. If you're smart and hustle in NYC, you can always make more money. You will probably have to do something heinous to get it, but it's sitting there, waiting for you.

That said, many hackers just aren't into the sort of startup projects that get funded and pay well in NYC. That's a bigger factor in the "talent shortage." The startups there just aren't that cool. If someone in Brooklyn started a company making life-sized Gundam robots you could control with your web browser, everyone would quit working at whatever foodie-blog-ad-network they're currently stuck at and work at the robot place for half their previous salary.

It's hard to do outsourced work in an early stage startup because stuff changes so frequently. The last startup I worked for in NYC actually did have a half dozen outsourced employees in places like Oregon and Hawaii and all but one of them quit because they were so frustrated about changing priorities and miscommunication.

mgkimsal9• 16 years ago

re: "Money" - a $100k job in NYC with living in NJ just isn't going to get you anywhere close the same living space (especially for a family) as that same money would in most of the rest of the US. Similarly, $150k+ would go a long way to help make up that difference.

Ultimately, it's just not a lifestyle tradeoff most engineering talent seems to want to make at those price points. Upping base to $150k (with something closer to $200k for sr-level talent) for startup engineers (vs ~$100k) would attract more talent the companies are claiming they need. If that's too expensive, perhaps 'startups' should locate themselves closer to where the resources they need are actually located?

Those issues of 'miscommunication' and 'changing priorities' are happening regardless of where the workers are, and I bet many people working at the main office were similarly frustrated.

I've worked on site and remotely, and understand the challenges in each. Neither is perfect, and having a remote team (and being a remote developer) requires certain skills. I'm dismayed, but perhaps not surprised, that these skills aren't actively developed and nurtured at more companies. The long term rewards will be great.

bugsy14• 16 years ago

"If you have a family and need a bigger place you can always live in New Jersey."

Right that makes sense, because top talent would like to live in a craphole just so they can have the privilege of taking a massive salary cut.

sleight423• 16 years ago

Excellent question. The parochial mentality that workers must be colocated is clearly part of the problem.

However, using remote workers is not the only solution. As a remote worker, I can tell you that I have to expend more effort communicating than I would if I was co-lo'd. Granted, I'm an extrovert so I don't mind terribly.

For more on this, see: http://evan.tiggerpalace.com/articles/2010/12/10/rule-0-choo...

cosmicray• 16 years ago

Instead of importing an entire team to NYC, why don't they export a team leader to Omaha or Tupelo for the duration of the project, or at least until they feel the team is groking the gist of the project.

natrius2• 16 years ago

Such a scenario would imply that there's a higher number of capable programmers willing to receive a given wage within commuting distance of those places than there is in New York. I don't think that's the case.

yummyfajitas• 16 years ago

Cost of living between Omaha and Jersey City, NJ is not nearly as bad. Just because you work in NYC doesn't mean you can't live 15 min away. (Queens and Brooklyn are similar priced, if you work on the east side.)

http://www.bestplaces.net/col/?salary=50000&city1=531370...

Also, your data on Indeed is a significant undercount of the higher paid programming jobs. If you are looking for a good programmer, you will pay $150k and you won't bother posting it on Indeed or Monster.

steele2• 16 years ago

Sure, the U.S. could be promoting education in the science & engineering, but blaming undergraduate institutions for not filling cubes (or exercise balls, yoga mats, etc) at a startup is completely off base. The job market is rough for recent graduates who were all but promised that the world is hungry for the skills their universities have tried to imbue upon them for an extremely large sum of money. Perhaps a small startup run by the campus Business School "idea guys & girls" less than a decade out of undergraduate school themselves is not the most secure option for someone whose student loan interest clock just started ticking. Should anyone be surprised that a senior or recent graduate might rather wait the several months to hear back from a large consulting company (who are also in hiring mode due to layoff too many people in 09 & are feeling client pushback on their broken offshore/onsite models)? The talent pool isn't as shallow as you would think. Startups buzz about "how to interview and retain a rockstar gurus" and end up looking for a walk-on-water engineer to work long nights for beans & equity with no guarantees for success. Smart kids are malleable, and even if they leave college learning Ruby, Common Lisp, or whatever the flavor of the week is, they will need to grow on the job. Take a chance, offer competitive or better-than-market compensation, and grow your talent from eager minds that buy into your vision enough to feel financially comfortable and invested in the success of the organization.

pyre• 16 years ago

  > Sure, the U.S. could be promoting education in the science &
  > engineering, but blaming undergraduate institutions for not filling cubes

More to the point, blaming higher education isn't filling the cubes right now. How is ranting about higher education going to solve your business's immediate needs? Even in a perfect scenario, where higher ed. is the problem, and even if a solution to the problem was implemented, how long would it take to see results? Are you going to just let your business languish until then?

(Note: 'you' is a generic you, not the poster. My comment was just inspired by misreading his first sentence on first glance.)

steele2• 16 years ago

generic you. Story of my life, haha.

I agree with your point completely. Outside of the present day situation, perhaps startups can do more for their campus & recruiting presence by incenting their engineers to host technology sessions and exposing students to topics not covered in their curriculum. This would be a huge benefit for smaller companies that find it hard to compete for mindshare with large, established organizations during campus job fairs. Even companies outside of the boutique category just completely rule out great schools with talented engineers because they can't justify the recruiting budget spend considering the amount of competition for talent during those career fairs.

okaramian3• 16 years ago

I think there is also an alignment problem between what the purpose of higher education is supposed to be and what employers are expecting from entry level employees.

College is not job training, it is a place where you learn how to learn stuff. The reason people believe otherwise is because college is really expensive, so it has to be viewed as an investment that will get you a job and deliver appropriate training.

Learning how to learn is important, it lets you move forward in whatever you take on. College as it is, is not a trade school, which seems to be what employers are expecting.

A degree in engineering or CS will churn out someone who has a strong analytical mind and the ability to learn more. Places that are hiring may need to adjust and accept that this is what the market is at the entry level, instead of complaining that the skills are not available at the price that they're offering. Companies might be better off offering less and expecting less (at the start, you might not get someone who can start churning on your application immediately) and growing talent in the process.

Also I've started seeing a lot of companies acting like the work they're doing is on the level of Google, when it's not and interviewing like they are and that's what they need.

Basically, it seems like a lot of employers have expectations that are way off the mark.

maxawaytoolong6• 16 years ago

If kids in the NYC metro area don't have an opportunity to learn programming in grade school it's because the schools suck. Perhaps if parents cared about their children's education, they could just relocate to a more forward-thinking part of the country. I was tutoring AP Computer Science to the kids of Vietnamese immigrants in the midwest 12 years ago. I took "C" and "Hypercard" class in junior high school 20 years ago and I lived in a farming town in the middle of nowhere.

The real reason NYC has a shortage of engineers is because engineers don't want to live there. Aside from one or two cool startups and the Google office, most tech jobs in the area are in finance or "agency" style work.

"...selling digital media, trafficking ads in DART, negotiating CDN prices with suppliers, creating P&L's where the COGs is Akamai, tracking and filing bugs in Pivotal Tracker..." sounds like exactly the "Boiler Room" sort of startup most people with other employment options want to avoid.

_delirium2• 16 years ago

I don't think it's purely regional. I went to a talk about high-school CS education a few days ago by some NSF guy, and the statistics he was quoting were that only about 2-3% of U.S. high schools offer AP CS classes. So they're going to be rare anywhere in the country.

Looking at the College Board's numbers for test takers, there are about 19,000 who take the AP CS exam per year, less than one-tenth the number of students who take the calculus exam.

infamouscow• 16 years ago

Fog Creek and Squarespace are headquartered in NYC.

bugsy14• 16 years ago

This is correct and both have both a small number of developers, pay very well, and have a really hard time at recruitment. Joel has blogged quite a bit on what a hard sell NYC is and all he has to do to sweet talk developers into even considering it. In the past I'd been offered very nice salaries to work in finance there and found there is no salary so high that it would compel me to move to NYC. Yes, many people love it there. Not many developers though. How many developers love the bar and party and media and high finance scene because they are massive extroverts?

krschultz4• 16 years ago

I don't know if teaching code in school really matters at all. I never took a class in programming in elementary, middle, or high school. I didn't take a class in programming until junior year of college.

I got my first job at a startup writing code when I was a freshman in college.

I was an engineering major, and I taught myself how to program in middle school, but never did I ever take a class on it.

Of all the various things I have learned, learning programming has one of the lowest barriers to entry of any. I really think it is a waste of money to focus on it in school. Most of the kids that I knew who took AP Comp Sci were ruined by it. A multiple choice test for basic programming? Yuck.

nhangen• 16 years ago

I think it helps. Being introduced at least, could make a difference. For example, I was a computer kid, but I didn't really know that programming existed. Had I been introduced to it in my teens, I likely would've at least toyed around in my spare time. Alas, I learned too late, and am trying to play catch up.

maxawaytoolong6• 16 years ago

AP CS is heinous, yes.

I disagree with the rest, though. I would agree if I thought the other classes were worthwhile, but about 70% of my junior high and high school was filler at best. At least if there had been programming classes I could have taken those instead of truly pointless stuff like the JV girls volleyball coach teaching "social studies" via VHS tapes.

jonsteinberg5• 16 years ago

I love those tasks, and they area big part of my job. I guess everyone has their own definition of boiler room.

waterlesscloud2• 16 years ago

How many startups really need rockstar ninjas? I mean really need them? As in the business will succeed if you have them and fail if you don't. I bet that number is actually very small.

But everyone thinks they're the special case.

aaronblohowiak• 16 years ago

Businesses fail to get traction for product reasons, business fail to grow/thrive because the mis-managed complexity makes changing the system too expensive. Ex: well, i'd love to build you that feature, but then i'd have to change x, y and z and there are no tests for y or z because we thought it would unnecessarily slow us down.. so it will take 3 months instead of the 3 weeks that hotshot rails dev you just hired said it should.

nostrademons9• 16 years ago

Having worked at two startups that died either because they could never attract skilled senior engineers or because they lost them, I think the number is quite large.

There're lots of ways for a startup to die and relatively few for it to succeed. The value of having a skilled senior engineer (or "rockstar ninja" as you put it, though that term has connotations that don't really describe the type of early engineers you want) is that they can see many of those failure modes ahead of time and avoid them. And when they do end up in a dead-end, they can quickly backtrack and fix the problem instead of wondering "what do we do now?"

bugsy14• 16 years ago

Few companies need the 0.001% that is a "Rock star ninja" such as Larry Wall or Dennis Ritchie.

However, to succeed you do need to be able to hire the 0.5% of developers that is competent and capable of bringing value.

chailatte• 16 years ago

Let's see....bad weather, high rent, high cost of living, lots of wall street jackasses, too many damn tourists, and plenty of terrorist threats. And we haven't even started talking about silicon valley's tech culture and close proximity to Asia.

brown9-2• 16 years ago

While I agree with some of your other points I can't fathom how a rational person could choose to not live/work somewhere because a few percentage points of the city's occupants are "wall street jackasses".

You're going to let other people make your living decisions for you?

bugsy14• 16 years ago

Speaking for myself I know what NYC is like and it's a basically a shithole filled with narcissists, psychopaths and useless welfare recipients. There are also some rich artist media types, but it's not like developers get invited to their parties.

What is there for developers? Almost nothing, plus high costs.

The Bay area has way better restaurants, culture, diversity and intellectuals plus nearby beaches, mountains, wineries, skiing, it goes on and on.

maxawaytoolong6• 16 years ago

Silicon Valley is a lot closer to New York than it is to Asia.

WildUtah• 16 years ago

Not a lot closer. Tokyo to SFO on a jet is 9 hours. New York City to SFO is six and a half hours.

dstorrs• 16 years ago

Let's see...incredible food, 24/7 nightlife, culture like nowhere else in the world, one of the largest and richest parks in the country, probably the best public transportation system in the country, a hell of a lot of convenience (drop-off wash-and-fold on every street corner, etc), a diverse and interesting population, easy access to not one, not two, but THREE separate international airports (JFK, LGA, Newark), and easy access to Europe.

whoover2• 16 years ago

You listed nothing of interest to the typical startup programmer.

Having a bunch of ways to travel doesn't do any good for people who are spending most of their time holed up in one spot. They won't be flying all over the place.

Night life? Have you MET many geeks? Plus that would cut into work hours.

Drop-off laundry? That means I have to take it somewhere. I'd rather have washer/dryer in the apt., then I don't have to lug it anywhere. Who cares about folding.

A diverse and interesting population -- very few of whom work in or understand startups. You don't have time to socialize anyway, and if you did, listening to people talk about finance or fashion is not "interesting".

Incredible food... This can be had in ANY major city. But nobody in a startup wants a 3 month waiting list to get into NY's trendiest new spot, so none of that stuff matters at all.

Culture... again, staring at a computer all day.

Parks? Yeah, like they don't have that anywhere else.

Not compelling in the least.

Look at Google's perks to get an idea of what developers want. Basically: get everything else out of the way so I can develop! Get rid of interruptions and distractions and extraneous TRAVEL -- I don't want to spend my time carting my jiggly fat physical body from place to place so that I can physically do the same thing in another place.

It's the same for ANY discipline. Olympic swimmers have the same deal -- eat, sleep, train. Being "well-rounded" is essentially training for social skills.

Tichy• 16 years ago

Then again, maybe the cranberry farmers and beer shippers are the people who are really running the world.

rmc• 16 years ago

Programming is a rare and economically valuable skill. It's hard to train people to be programmers.

maxawaytoolong6• 16 years ago

Perhaps the reason startups are struggling to hire in NYC is not because there are too few hackers but because there are too many startups. Most hackers simply do not have aspirations to work 80 hours a week to make some MBA jackass rich off of his website which promises to revolutionize the world for apartment brokers, attempt to make print media relevant online, or sell last year's handbags at a discount.

clofresh2• 16 years ago

I worked at a profitable, medium size company with a startup-like hacker culture and it was still very difficult to hire talented programmers despite being able to offer interesting work that provided a net benefit to society, normal hours, free soda and career development. We'd have to go through many, many candidates who looked good on paper (lots of experience, top tier education) but were awful once you presented them with basic programming problems. It was actually pretty demoralizing to have to reject the volume of people that we did.

I do agree that there are a lot of silly startups these days, but it doesn't mean that there isn't also a shortage of quality hackers.

bugsy14• 16 years ago

Wow free soda! I can't imagine why top talent wasn't beating a path to your door!

yannickt• 16 years ago

"[...]work that provided a net benefit to society, normal hours, free soda and career development."

They are not exactly putting on the table things that good engineers do not have at their current job. Also, perks like "free soda" only attract the young and inexperienced.

egometry• 16 years ago

If "startup-like hacker culture" means "engineering-driven", I doubt you'd have trouble filling seats.

The thing that seems (in my experience) to drive engineering loyalty the most is making it known to the coders that their opinions are valued by the non-engineers, and that the engineers can drive actual product change (as long as they can prove their ideas legitimate.)

Hiring blindingly smart people and then telling them to stop thinking about the aspects of the business that don't involve writing code is short-sighted and demoralizing to the staff.

notJim• 16 years ago

It seems like even among startups and small businesses that are reasonably well-run (meaning decent process, and developers aren't overworked because of management failure), it's very hard to compete with the benefits and compensation that a larger company can offer.

And is it really news that many companies are poorly run by clueless douchebags with MBAs? Surely this is just as true at larger companies as it is with startups. Larger companies are just better at covering it up.

d2viant• 16 years ago

That 10% is the broader unemployment rate and includes all occupations. I believe the latest stats from the BLS peg unemployment among software developers at about 4%. Most good developers are gainfully employed, it's up to you to entice them away from what they're currently doing.

bugsy14• 16 years ago

"Most good developers are gainfully employed"

I agree, but I'd say that all good developers who want to be employed are employed.

Companies bring up 10% unemployment because they think "Gosh with all this unemployment there will be lots of 'hungry' developers and we should be able to hire top talent for $80k or some other piddling sum."

The fact is that unemployment among competent developers (and marketers and sales) is 0%, so if a company wants to hire one they've have to pay more than the other guy and offer better working conditions. The incompetently run companies don't comprehend this, they are much too "bargain" oriented on non-commodity products.

pdelgallego• 16 years ago

Are you sure startups in NYC are struggling to hire?

A years ago, I was in the states under a F1 visa. I was looking forward to do an internship in NYC. I couldn't even get an interview. I spoke with at least twenty recruiters.

I was at that time an active OS contributor, I had commit access in projects like Rubinius or in Sputnik Tests (Google conformance test suite to test V8). I had also two years of commercial java programming experience, and personal projects in rails, sinatra and django. This was just after I finished a internship at Google.

What compensation was I asking for? Enough money two rent a room and buy food.

mikecane• 16 years ago

Oh god, recruiters. They will kill your dreams every time. They have zero ability to judge skill. They are basically car salesmen. If your resume doesn't fit their template, you will never, ever get work, and you could be a damned genius with recommendations from others too.

ig1• 16 years ago

Yes there's a mismatch between the jobs available and the skills of the unemployed. But the rest of the article is pretty much wrong.

Plenty of people aren't cut out for programming or just don't like it. Trying to force them into jobs where there not a good fit isn't good for anyone.

Business schools should teach a wide range of case studies from a range of sectors. Yes that includes farming and food logistics.

The beer company InBev ships $36 billion dollars a year of beer. That's more than market cap of Facebook. The Beer industry is probably worth more than the combined value of every startup featured on Techcrunch in the last year.

Let's not exaggerate the importance of our industry in the wider scheme of things.

ThomPete• 16 years ago

Every startups is struggling because very few of those 10% live in NYC and have the relevant education or background.

jonsteinberg5• 16 years ago

Yes. You're right about that

BrianMatch• 16 years ago

Part of the issue is that the 10% unemployment rate is not equally distributed across all demographics.

If we generalize the desired startup labor pool as college-educated adults over the age of 25, the national unemployment rate drops to 5.1% (http://www.bls.gov/news.release/empsit.t04.htm). I can't find a great source, but I'd also wager that when you factor location (NY metro) and industry (technology), the unemployment rate drops even further--almost to the point of natural unemployment.

If you fit this profile you shouldn't have a difficult time finding work, and hence we have a "war for talent" in the face of high, national unemployment.

mmaunder• 16 years ago

NYC startups are struggling to hire because there is a real shortage of skilled labor in the country including technology labor. The 10% unemployment reflects a surplus of labor that would normally be taken up by manufacturing jobs which we don't have since we became a service economy. The 08 crash was an excuse to fire legacy employees. We will never get the jobs back that we've lost.

jorgeortiz85• 16 years ago

I agree with the author that programming (not just "tech") literacy should be part of every curriculum, I don't think this will solve the unemployment problem.

Technology is very good at creating value, but not very good at creating jobs. All 72 tech companies in the S&P 500 combined employ about 2.3m people [1], whereas just Wal-mart employes about 2.1m people. Those numbers are worldwide employment, but for reference, the US had 15m unemployed in November.

Even the breakout, unimaginable success that is Google only employs about 28,000 people. And I'm sure that for every hire Google has made, they've displaced many more people that used to depend on print advertising. (To be clear, I'm not saying that technology is net bad for the economy. Technology creates a lot of value for the individuals that work and invest in it, and for the economy as a whole. However, technology is not a massive creator of jobs.)

So unless startups become a multiple of the size of the entire S&P 500 technology sector, they're not going to make a noticeable dent on unemployment.

[1] I compiled a spreadsheet (https://spreadsheets.google.com/ccc?key=0AqpDDf0Sr4EXdDJMZEt...) based on information available on Wikipedia[2] and through Google searches

[2] http://en.wikipedia.org/wiki/List_of_S%26P_500_companies and individual company pages

jonsteinberg5• 16 years ago

Jorge this is a fair point. However, over time I have to believe that the shift to post-industrial will create more jobs. You're right that this doesn't absorb anything close to 10% in the short or medium term.

Also, I wasn't arguing in my post that this was a solution to 10%; just that in my world and sector there's lots of jobs despite this big unemployment number. And we need more technical literacy (not just programming skills as some commenters have misinterpreted) throughout our education system.

For example, every business class I took as recently as 2003 involved products in boxes and shipping.

rorrr• 16 years ago

Yeah, but walmart people will soon be replaced by robots. More and more automation will create more and more unemployment among uneducated.

It's pretty fucking hard to automate programming. Heck, we can't even solve voice and character recognition.

rbranson2• 16 years ago

We have automated the hell out of programming (compilers, shared libraries, higher level languages, etc), but as soon as we do that, they just expect us to be more productive :)

I think it will be still be a long time before robots replace humans, even at Wal-Mart-like jobs. There are a few places where it's appropriate (self checkout, for instance), but there are things that humans do without batting an eyes are very very hard or expensive for robots (spoken communications, visual and auditory classification, spatial navigation and obstacle negotiation).

Humans aren't really that expensive honestly. Considering that the rent on a few servers from EC2 can equal the hourly wage of a Wal-Mart employee, it's going to be a while before these equations start working out.

charlesju2• 16 years ago

http://twitter.com/#!/charlesju/status/10722704009199617

High School dropouts are 15.7% unemployed. College grads are at 5.1%, basically full employment given job changes. http://bit.ly/3FWnbX

phil• 16 years ago

That's not "basically full employment" -- it's the highest unemployment rate among college grads in the last 2 decades.

Here's a BLS report that shows that more clearly: http://data.bls.gov/PDQ/servlet/SurveyOutputServlet?request_...

charlesju2• 16 years ago

http://en.wikipedia.org/wiki/Full_employment

"The idea that the full-employment unemployment rate (NAIRU) is not a unique number has been seen in recent empirical research. Staiger, Stock, and Watson found that the range of possible values of the NAIRU (from 4.3 to 7.3% unemployment) was too large to be useful to macroeconomic policy-makers. Robert Eisner suggested that for 1956-95 there was a zone from about 5% to about 10% unemployment between the low-unemployment realm of accelerating inflation and the high-unemployment realm of disinflation. In between, he found that inflation falls with falling unemployment."

KevinMS• 16 years ago

Good, let them struggle.

Maybe someday they will learn that the only developers aren't young and just out of college.

There are plenty of good developers that are self taught, and there are also plenty of good developers who aren't in their 20's, but if you every look at the "about us" of these startups, and they have pictures, what do you see?

lkrubner2• 16 years ago

Responding to previous comments, I would advise against using an Indian firm for a startup. I think overseas firms can do well when assigned routine work, like putting in a CMS where all the requirements are straightforward, or handling inventory and accounting. For exceptional circumstances (which is what a startup faces) you want people who can meet everyday in the same room.

Geographical distance is a major problem for small startups.

I worked on a project last year where the project manager was thrilled at the idea that he could hire Indian programmers for $10 an hour. I was in New York City, we had another programmer in North Carolina and another in Europe. The "CEO" was an investor who attended meetings 2 or 3 times a month. The project manager was basically the CEO, but he had no real power, since everything needed to be decided by the CEO. Myself and the project manager would have 3 hour conversations and decide on something, but then need to explain it to the CEO, whom we only saw a few times a month.

The project went nowhere.

From this, I conclude, it is best to have small team working in the same room, when doing a startup.

The team in India was unusually bad. Every time they committed code to Subversion, something broke and I would have to fix it.

gnufied• 16 years ago

Duh, You are right; if someone wants to hire lots of cheap Indian labour for $10 an hour, you will get bad programmers. I think, at that rate you will get bad programmers anywhere in the world.

I am building (http://solaro.com) and we just launched our application out of beta. Development happens from India and surely there are kinks and warts, but at the end of day it works.

I think there are lot of things people get wrong when doing outsourcing:

1. Going cheap. Good programmers are costly. In India you will have to fight with Google, Amazon, Microsoft, Adobe and likes for the talent, you can't pay cheap and expect good programmers.So, please do not come to India, if goal is to stay cheap.

2. Not involving the team. You will have to bring down your walls and involve everyone intellectually. This is real, if people aren't involved with the product, you are going to get crappy result. I am saying nothing new, but what already Jim McCarthy said in Dynamics of software development. But this is more true for projects, where your team is spread across different geographical locations.

3. Iterate. Short iterations, deliver, continuous integration and continuous deployment. Do not sleep on the project.

4. Small teams, do not build a large team just because it is cheap. I know I am saying the obvious here, but I have seen people getting it wrong too often.

5. If the client (or product owner) is located in different geographical location, he/she has to work harder than everyone else.

lkrubner2• 16 years ago

So far, on Hacker News, the conversation has focused on hiring programmers, but the original article is broader than that:

"Despite all this unemployment, every startup I know needs to hire not only engineers, but also sales and operations team members. And this is not just bubble seed startup dollars at work."

In 2008 I tried to find a good marketer to work with a client of mine. This is a difficult task. There are many people who claim they understand online marketing. Finding anyone who is any good is very difficult. The noise to signal ratio is amazing.

Likewise when it comes to fundraising, pitching to investors, etc. It is tough to find the few people who are good.

Possibly part of the problem is that, even in this economy, the folks who are truly good are making really good money and don't want to invest time with a startup.

No doubt there are many folks out there who will one day prove their talent but they have not yet had the chance. The question then becomes, how to find them?

iskander3• 16 years ago

I've hired a few technical employees in the Chicago area, and I found that it's almost impossible to find someone with basic reasoning skills. Most people I interviewed had very poor eyes for details, had a hard time spotting or understanding their own mistakes, making sense of novel situations, thinking abstractly or generalizing from specifics etc... This was true even among CS graduates from schools with decent reputations. I don't know why the pool is so bad or if it has always been this way.

bugsy14• 16 years ago

How much do you pay, what relocation is offered, what interviewing expenses do you cover, what benefits are paid, what severance package is offered, and do you provide engineers with all the tools, books and training they request.

You don't need to answer me, just answer these honestly to yourself and that will tell you why you can't find anyone competent.

iskander3• 16 years ago

If qualified applicant need assurance of all these things before even applying, that confirms in my mind that such applicants have the privilege of scarcity.

Has your hiring experience been substantially different from mine?

Supermighty• 16 years ago

From my view the real problem is how valuable will English majors be at my startup. How long will it take them to get up to speed where someone doesn't have to hold their hand anymore.

I am really weary of hiring someone with zero programming experience. But not as apprehensive about hiring a programmer with little experience but some experience.

I'd be more likely to hire someone who was a self starter when it comes to learning programing over and English major who just couldn't find a job.

gunmetal• 16 years ago

The resume/interview hiring process is severely broken in US. It is not the schools, it's the companies hiring, they are looking for some perfect holy grail but really need to just start hiring people and pick through the chaff. These startups deserve what they get making it impossible to even find their 'perfect employee'.

itsnotvalid• 16 years ago

TL;DR version of anything like that: Those people aren't the ones that startups want to hire right now.

puredemo• 16 years ago

Because those 10% of unemployed folks are definitely highly-skilled programmers. Right.

danbmil99• 16 years ago

1) because all us smart NYC programmers got the hell out of there during the "Silicon Alley" days.

2) Practically anyone who lives within 100 miles of Wall Street and can program, and isn't a completely dysfunctional human (and many who are), is doing something in the financial sector. It's a huge brain drain, and it's practically impossible to compete with on the basis of salary. To boot, you can't easily motivate these folks with options because A) NY doesn't have a reputation for churning out tech winners and B) these same people study finance for a living, so when you offer them some options or founder's stock, suddenly you're into a discussion of volatility premiums and Black/Scholes analysis of the present-day value of said stock/options.

It's just not a suitable place for a vibrant startup community.

rick888• 16 years ago

I've noticed that many startups want people that are: a senior developer in new technology X, is good at Photoshop, and can design customer facing webpages. They also want to pay you well below market wages (because you should be happy to work for a fun company that has a fooseball table) and give you company equity in place of sub-market wages (which is a joke, because most startups are out of business within 5 years).

rwhitman• 16 years ago

To those hiring in NYC - I just relocated to the east coast from CA and am looking for opportunities in NYC. Feel free to reach out.

known• 16 years ago

They prefer to hire a highly skilled wage slave.

cafard• 16 years ago

I know a number of quite proficient programmers with degrees or backgrounds in the classics. Some, to be sure, are of the generation where 8th-grade programming class wasn't really an option. I'd much rather see the primary and secondary schools teach human languages and mathematics than see them try to teach coding.

10% unemployment yet every startup in NYC struggling to hire

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