Wall Street Yesterday, Silicon Valley Today, Next Talent Mecca?

The answer might be closer than you think.

The job market has always had pockets or industries that have been the most lucrative in terms of salaries and the potential for wealth creation. For the longest time, the title of the most monetarily lucrative place to be was Wall Street — or the world of finance and investment banking.

This was until the last decade or so when the world of technology and entrepreneurship took over the world. As the Googles, Apples, Facebooks of the world usurped every other company in terms of scale and profitability, top talent found a new home in the Silicon Valley.

This was largely owing to the combination of the financial crisis of 2008–09 and the surge in tech and internet companies in the years that followed. According to a CNN article from 2018 — a decade after the global financial crisis,

In 2008, 20% of business school graduates worked in finance and 12% worked in tech, according to the Graduate Management Admission Council, the nonprofit organization that administers the standardized B-school entrance exam. Today, 13% of MBAs work in finance and 17% work in tech, the council’s annual survey found.

Within a decade, tech jobs had gone from lagging finance by 8 percentage points to leading it by 4.

Technology was, and probably still is, the new sexy — or I might say the cool.

Warren Buffet has been replaced by Jeff Bezos and Elon Musk. The aspirations have shifted.

However, in a world that is increasingly changing more rapidly than ever before, will this trend stay, or are we already looking at a new trend? 2020, owing to the pandemic, has accelerated many business trends, and this may well be one of them.

From the “sexiness of Wall Street” to the “coolness of Silicon Valley”, we may now be shifting to the “comfort of home sweet home”.

Yes, I think the next big thing to chase for the coming generations will be the comfort of working from home — not only in the sense of remote working and working on your own terms, in a field of your choice, but also commanding the best return for your effort. Let me elaborate.

Shift Towards a Skill-Based Market

In the competition for the top talent, companies and management are moving increasingly towards a skill-based approach towards engaging the right people for the job. There is a shift away from a focus on formal qualifications, years of experience, location of a candidate, towards a more skill and job-fit-based assessment.

Specialized talent is valued — no matter what the area of specialization. If you have a specialized skill, there is a market for it. According to a Willis Towers Watson survey, companies are also compensating employees based on an assessment of skills vs. more traditional parameters. This trend has been significantly accelerated due to the pandemic, and the realization of the capabilities of remote working.

This means that whether you’re a coder, writer, consultant, designer, editor, data operator, or any part of the services industry, your skill now dictates your value — your location is increasingly irrelevant.

Significant Cost Savings for Organizations

Hiring more remote workers, or even freelancers means that organizations don’t need to have the same office spaces that they are used to having.

The increase of technology usage and ease of remote work has meant that since 1990, Corporate America has already seen a fall of about 20% in office workspace per employee, even pre-pandemic.

This trend is set to accelerate rapidly as companies rethink the way they operate. As an example, one of the largest IT services company in India, Tata Consultancy Services, has announced its 25 by 25 vision, as a result of their SBWS or Secure Borderless Workspaces initiative:

The clear advantages of SBWS™ so far have led TCS to announce the 25 by 25 vision — by 2025, only 25% of TCS workforce will work out of TCS facilities at any time, with associates spending only 25% of their time in the office. And within project teams, only 25% of employees can be co-located.

The ability to give up 75% of office space and related costs for a company of the scale of TCS which has over 460,000 employees is a huge operational benefit in the longer run.

Lower Compensations, Higher Employee Satisfaction

A huge element of high compensation in some of the financial centers of the world is the migration of labor to these cities in search of the most lucrative jobs, and the resulting high rentals.

Hong Kong, London, New York, and other such cities have the highest rentals and property prices in the world.

By eliminating the need for employees to work in these select cities, and allowing them to work from their hometowns means eliminating a huge expense for them, and in turn the ability to pay lower salaries.

Rentals are often up to 40%–50% of the household expense, and by taking that away or lowering that significantly, a slight decrease in compensation would still mean higher savings for the employee — and hence a win-win situation.

Ability and Incentive to Upskill and Advance

With the freedom and flexibility that comes with working on your own terms, without the bureaucracy of a physical workspace, there is an opportunity to constantly enhance your skillset, or even explore parallel income streams.

This takes away any limitations or barriers in terms of company restrictions and allows for an individual to differentiate and enhance their market value at their own will and pace.

For millennials and the following generations, that ability and freedom to choose and do things at their own accord is probably the biggest incentive, much bigger than the lure of the traditionally lucrative industries.

With a completely new environment that we are now faced with, including but not limited to the workplace, there are endless unknowns, but an equal number of opportunities behind those unknowns. It is important to get ahead of the trends that are to come and position yourself accordingly.

In my mind, building up your skillsets in an area of interest and being able to market that to get the desired and appropriate value, right from the comfort of your home, is the way of the future.