Saleforce joins Netflix, Meta, Coinbase, and Uber in plans to slow hiring
After expanding headcount from 57,000 to 73,000 in 2021 (due in part to their $27B+ acquisition of Slack), Salesforce announced plans to slow hiring and put certain roles on freeze.
This should come as no surprise given the uncertainty that has roiled public markets, particularly Big Tech stocks that have gotten hammered over the past 5 months. Salesforce stock price ($CRM) has sunk over 50% in the past 6 months alone.
As recently as January of this year, they had plans to add another 4,000 employees this Quarter but it seems those plans have changed.
Is Salesforce doing layoffs in 2022?
As of writing this article on May 23, Salesforce has NOT announced any layoffs, so there is no expectation that they are trimming existing staff. Salesforce is one of the most aggressive Bay Area recruiters, while also investing heavily in expanding the talent pool across the Salesforce technology ecosystem through various internship programs, partnerships, and workforce development initiatives (including their L&D platform, Trailhead and a dedicated workforce development program, Pathfinder).
Salesforce did announce layoffs in August of 2020 during the height of the pandemic when they let go of roughly 1,000 employees.
As of now, the guidance for 2022 is simply to slow hiring with limits put on specific open headcount but at the pace they're recruiting, this still means net employee headcount growth for 2022-2023.
How is Salesforce stock performing in 2022?
Like many (or virtually all) Technology stocks, Salesforce is having a rough year in the public markets.
Year-to-Date, Salesforce stock ($CRM) is trading down 37.15%. Compared to some of their SaaS peers, this steep loss is the standard across the market with Hubspot down 44.75% YTD, Zuora down 45.18%, Snowflake down 58.18%, and ServiceNow down 30.66%. (A brightspot in the SaaS market is Zendesk, which is only down 5.94% YTD - granted, they trade at a significantly lower valuation than Salesforce - $11.9B vs. $159B, respectively.
Salesforce hiring freeze is good for Salesforce Consulting Partners
This type of hiring freeze should come as welcomed news for Salesforce Implementation Partners.
It is known throughout the Salesforce community that every company's biggest competitor in hiring Salesforce Consultants is Salesforce itself. They have a Professional Services organization that accounts for 6%+ of total revenue and that takes a lot of Consultants that companies like Accenture, Deloitte, IBM, and others are trying to hire for their own Salesforce Practices.
While the hiring freeze isn't focused solely on the Professional Services organization, when Salesforce slows their hiring of good Salesforce Developers, Administrators, and Support Specialists it is good news for the rest of their ecosystem.
Prediction: Companies will use Freelance Salesforce Consultants
During periods of uncertainty, we should expect to see all company's resource strategies shift. The primary objective is to continue day-to-day business operations as efficiently as possible and utilize a hiring strategy that gives a company flexibility when uncertainty hits.
Salesforce Contractors are a great way to operate efficiently, since you aren't guaranteeing a full 40 hours worth of pay. Instead, you can use part-time Salesforce Consultants to only focus on the most critical work; therefore, only paying for what absolutely needs to get done instead of committing to a full-time salary + benefits + paid time off.
Since Freelance Salesforce Consultants are Independent Contractors, these projects can be ended at any point. If the market does take a turn for the worse, it is easier to offboard a Contractor than it is to navigate layoffs -plus, Contractors typically have a handful of clients they are working with simultaneously, so they aren't reliant on a single company for their income.
