Young companies in this decade are built by people who fall into one of two categories: developers, and “support beams” — people who have shallow skills sets across a wide spectrum as opposed to specific expertise. According to the US Bureau of Labor Statistics (BLS), jobs created by establishments less than one year old decreased by 40.44 percent between 1994 and 2010.[1] Between 2012 and 2022, the demand for software developers will increase 22 percent, and the employment demand for web developers will rise 20 percent over the same time period.[2][3] While younger companies may have less capital to invest in employees, the fact that employment in young companies is going down from year to year speaks to more than just a lack of money to pay employees; it speaks to a decreasing supply of human capital needed to reach the same major milestones the same company would reach in the 1990s.
In addition to that, the BLS suggests that projected employment between 2010-2020 will increase by 1.3 percent across all companies.[4] The discrepancy between the trend of overall employment going up and employment for companies less than one year old going down points to the lack of human capital necessary in most young companies, due to the ability of developers to automate processes and time-intensive tasks. With the introduction of the lean startup methodology, which is the process that helps companies reach successes more quickly by rapidly iterating on feedback from stakeholders, extremely small teams of innovators can build applicable software quickly and efficiently, while generating large amounts of revenue. Within these teams, it is necessary to have a small group of those who are builders to lay the architecture and foundation, and those who serve as support beams, allowing the builders to focus on continually building upwards while creating a successful product or service for a market.
With $3 billion invested in Massachusetts companies in 2012, the value of a degree for most college majors has diminished in the eyes of these young companies.[5] Young companies often value the ability to learn quickly and execute efficiently far above anything else, especially in the realm of software or web development. From an entrepreneur’s perspective, what he or she cares most about is building the company. This involves either finding someone with an extremely specific skill, which could be in an industry or specialty that is accessible most easily through research institutions, or having an employee who is good at a wide range of skills and can help enable those with specialty skills execute more quickly on an iterative process.
With today’s ability to access the wide range of information on the Internet, a majority of web developers or software programmers are self-taught based on what they find online. Even with the aid of an educational program, which certainly give a more formalized, rigorous web development education, field of programming is a constant process of hunting down information or examples on the Internet to figure out how to build something next. This access to information allows developers to specialize in anything and everything on a daily basis in the current world, as in the past you needed experts in certain aspects of technology; a developer has access to countless resources and endless documentation that allows them to find answers that would have demanded expert knowledge in the past.
Along with the increase in developers comes the great increase in automation of processes. More often than not, a developer is building something to make a repetitive process self-perpetual with no need for human interaction, aside from one person clicking a button to either execute or stop a script. Computer developers are finding new ways to do data entry, data mining, reporting, statistics, and even internal processes, when it comes to communication and organization. For example, I’m currently working full-time at HubSpot where metrics are constantly being used to evaluate success. Whenever we reach and point and say, “It would be great to know ‘x,’” one of the developers dives in for an hour and builds a report that can be accessed indefinitely. It includes insight that an internal team member may be looking for, such as the number of users that have successfully completed a specific set of onboarding tasks for a web application.
Paired with this increase in automation comes the downfall of the entry-level job. TIME Magazine’s February 24th, 2014 issue contained an article about higher education, and cited that the amount of jobs that require a bachelor’s degree or above will have changed from 16 percent in 1973 to a high of 35 percent in 2020.[6] This could be directly attributed to the fact that the lower-level entry-level job is disappearing, and larger companies and startups that have already found product-market fit are the ones employing the majority of degree holders. Within the realm of specialized industries, or studies such as biochemistry, electrical engineering, finance, and law, the degree will become increasingly important to employers. Evaluating a job candidate that is holding a specialized degree will allow an employer to directly attribute the degree to a specific understanding of knowledge that supersedes base-line entry level work.
After gaining experience in multiple startups myself, it has become clear to me that there is a need for — an extremely high value placed upon — candidates with three core characteristics: the ability to learn very quickly; the capacity to effectively communicate with skilled employees; and the ability to motivate others effectively using empathy, most specifically related to the web developer or technical expert. These types of people can act as support beams in companies, and land in key roles in product management, customer success, and operations. There is no degree specific to this skill, but it cannot be learned through a simple Google search. Things such as interdisciplinary class projects and real world experience can help build these specific skills.
People are frequently asking for connections to developers for a potential project. There are dozens of tools that help one become well versed in web or software development: Codecademy, Tuts+, and Treehouse, for example. Those latched onto their own ideas, which they can ultimately build themselves, are often stuck in an old paradigm — one in which companies would go out, hire a lot of people, and make their ideas a reality. In the modern world, the paradigm involves teaching yourself how to build, getting something started, and hiring later. In the past, the method of hiring others to build made a lot of sense. However, the new simple truth is that successful young companies have an approach to get builders and support beams that can hack stuff together to get the company’s wheels spinning. Once off the ground, then it’s time for an entrepreneur to step back and hire those with degrees to implement more scalable operational processes, as well as apply domain-specific knowledge into new departments such as R&D and marketing.
Automation itself is causing a fundamental shift that has been rocking startup ecosystems for the past decade. The majority of employment opportunities, most specifically at startups, are moving toward this two-fold employee marketplace: either you’re a developer that can build, or a support beam. A quick glance at the Boston-based VentureFizz.com jobs board will show that almost all jobs fall into one of these two buckets for all the younger companies that have posted jobs.
Between the demand in developers rising at such a rapid rate and the ability to become self-taught, it’s no surprise that President Obama, in support of code.org’s initiatives, is asking Americans to learn computer science.[7] Government-spawned initiatives such as Code for America also show the need for Americans to stay ahead of the curve and become the builders of tomorrow, rather than the dreamers of today with no ability to make those dreams come true. While there are recommendations by the government to learn code, it is imperative for startups to pass on computer-intensive skills to Americans. There are some local initiatives within the Boston & Northeastern communities to help encourage this, such as Intelligent.ly, General Assembly, iMadeIT, and more. In addition, I would point to HubSpot as an example of this in creating a world-class program that helps teach students to become great developers in conjunction with Northeastern’s innovative co-op model.[8]
In addition to this, there is a far greater need in the realm of startups and America to help educate and enable those without coding experience, and those who simply don’t enjoy it, the support beams of these young companies. While skills such as empathy and motivation are essential, there’s a huge opportunity for the entire ecosystem, from young companies to global enterprises to local organizations, to help enable these support beams to become knowledgeable in the large range of skills that startups need. Obama pointed to this in his 2011 State of the Union Address:
“The first step in winning the future is encouraging American innovation. None of us can predict with certainty what the next big industry will be or where the new jobs will come from. Thirty years ago, we couldn’t know that something called the Internet would lead to an economic revolution. What we can do — what America does better than anyone else — is spark the creativity and imagination of our people.” [9]
Without properly training employees, potential employees, and the American public to become either developers or support beams, it will prove difficult for the innovators of America to drive the economy forward.
Matt Bilotti
Entrepreneurship ’15
References:
[1] “Entrepreneurship and the U.S. Economy.” U.S. Bureau of Labor Statistics. Accessed March 12, 2014. http://www.bls.gov/bdm/entrepreneurship/bdm_chart2.htm.
[2] Henderson, Richard. “Industry employment and output projections to 2020.” Industry Employment. Monthly Labor Review, n.d. Web. 12 Mar. 2014. http://www.bls.gov/opub/mlr/2012/01/art4full.pdf.http://www.bls.gov/ooh/computer-and-information-technology/software-developers.htm.
[3] “Home : Occupational Outlook Handbook : U.S. Bureau of Labor Statistics.” U.S. Bureau of Labor Statistics. Accessed March 12, 2014. http://www.bls.gov/ooh/computer-and-information-technology/web-developers.htm.
[4] “Home : Occupational Outlook Handbook : U.S. Bureau of Labor Statistics.” U.S. Bureau of Labor Statistics. Accessed March 12, 2014.
[5] “Boston Startup Scene Presentation Fall 2013.” Boston Startup Scene Presentation Fall 2013. Accessed March 12, 2014. http://www.slideshare.net/bussgang/boston-startup-scene-presentation-fall-2013.
[6] Foroohar, Rana. 2014. “The School That will Get you a Job.” Time 183, no. 7: 22. Business Source Complete, EBSCOhost (accessed March 16, 2014).
[7] “President Obama Asks America to Learn Computer Science.” YouTube. December 08, 2013. Accessed March 12, 2014. http://www.youtube.com/watch?v=6XvmhE1J9PY.
[8] “Serious About Co-op Students.” Serious About Co-op Students. Accessed March 12, 2014. http://www.eliastorres.com/blog/serious-about-coops.
[9] -President Barack Obama, January 25, 2011. “Innovation.” The White House. Accessed March 12, 2014. http://www.whitehouse.gov/issues/economy/innovation.
