Do a Job Market Audit

If you have a career moat, it's probably a good idea to do a job market audit right now.

First, some context.

Those of you who have been following Commonplace for a bit would know that this is a blog about career moats, and career moats are built on top of rare and valuable skills. I spend so much time writing about this topic because I'm particularly paranoid about job security, and I spend so much time on the topic of skill acquisition because one’s ability to acquire new skills (and adapt to changing environments) is ultimately what determines the depth of the moat you’re able to build.

You may go read the archives if you’d like to know more about my approach; the broad argument I make is that career moats come in two forms:

1. You become the ‘best’ in a specific, valuable field. (Think Geoffrey Hinton, who invented the neural net approach that is so dominant in artificial intelligence today; or Jeff Dean, who is widely recognised as one of the best software engineers in Silicon Valley.)
2. You acquire a rare and valuable combination of skills.

The second form comes in a further three flavours:

• A skillset can be rare and valuable if the path to your unique combination of valuable skills is opaque.
• A skillset can also be rare and valuable if the skillset is unattractive but valuable.
• A skillset can be rare and valuable if you specialise in it before it becomes clear that it is valuable.

One interesting way of looking at this is that the career moat view of the world assumes that the job market is a market. Markets are governed by demand-side and supply-side characteristics; what makes for a valuable skill is a demand-side concern (companies want to hire for it); conversely, what makes a skill rare is a supply-side issue (you can’t build a career moat on a skill that people may learn in school).

This framing leads to a number of interesting implications — for instance, readers sometimes email me and ask “how do you know if a skill is rare and valuable?” and “what’s a good first step in building a career moat?” and my answer is always the same: “you take some time to understand the job market you’re in.” In fact, the first step to a career moat isn’t to introspect and look within yourself for your strengths and weaknesses; the first step is always to study the market around you.

This is common sense, I think: you cannot know what is valuable if you don’t grok your industry; you cannot know what is rare without some understanding of the talent pools available to the companies in your area.

This framing is useful, but I also think it’s more important today than it was just a couple of months ago. It informs my thinking around the current recession: how do you know if your career moat is any good? Well, you study the job market around you.

It’s Time to do a Market Audit

Let’s use my career moat as an example for this post. I’ll talk a little about what I’ve been doing to study the shifts in the job market around me, before generalising a bit at the end.

I first wrote about my personal career moat in Building Career Moats: A Confession:

A few months after I returned to Singapore, I met up with Willis Wee of Tech In Asia (think: the TechCrunch of Asia). He said, almost as an offhand comment: “Why is South East Asia relevant? Well, if you're a big company looking to expand: where do you go to after China and India are taken? You go to SEA, of course. It's one of the most populous regions in the world. And it's not easy to dominate the region: each of the SEA countries are wildly different. So a company that has managed to successfully expand to each of the SEA countries becomes a very ripe target for acquisition.”

I thought about that analysis for a few weeks afterwards. I realised that Wee's argument made sense. More importantly, I realised that the second order implications were relevant for my career. If SEA mattered to startups because they needed to lock up markets across SEA, then they would need people who could set up and run offices in these diverse markets. This was a skillset I could learn.

More importantly, this was a skillset that was rare and valuable. I could not compete with my peers in NUS on algorithmic interviews. But I could compete against them with regard to setting up tech offices across 3rd world countries. This was due to three things:

First, not many of my peers were aware of Willis Wee's insight. It was only by luck (and my position with NUS Hackers) that I'd met Willis for coffee. I then spent some time working out the implications of his remark.

Second, I could compete with my peers because even if they did know of Wee's insight, they wouldn't be so willing to move to Vietnam. This discomfort was an edge I could wield.

Third, I could compete because this was not an easy skill to gain. In the end, I spent 3 years in Vietnam, learning to deal with government corruption, hiring strategy, technical management and organisational building in a foreign culture. It was great. And I now have a career moat for a few years — at least until I need to settle down.

This ‘I’ll help you set up and run a regional office’ moat has been incredibly valuable to my career: it was what allowed me to leave my previous job to start my own company. My justification was that if my own thing ever failed, I could hop back onto the job market to get a job; my career moat was what gave me that security.

The truth, however, is that my moat might no longer be as valuable in a post-COVID world. And so I’ve begun setting up meetings with friends to get a feel for this shift, and to better understand what the regional dynamics will be. I think most people reach for conversations instinctively during periods like these, but I’m doing meetings with specific information-gathering goals in mind.

I’m interested in learning:

• Are their companies hiring? If they’re not, what reasons have they given for their hiring freeze? If they are, why?
• If the person I’m talking to has been interviewing around, what have their experiences been like? The more detailed the stories, the better.
• Of the companies with regional offices, how are those companies thinking about hiring in those markets?
• I work in the tech industry; what kinds of companies here have been affected? Are there patterns in the ways they’ve been affected?

The answers, of course, are messy — as they often are when you’re gathering qualitative data. Some companies are hiring more aggressively in the recession because they perceive a lack of competition (this is true for software engineering; business development roles, on the other hand, seem to have mostly been put on ice). Others have cut expansion entirely. Some are still working out the implications of mandatory work-from-home orders by the various regional governments. It’s not entirely clear how the job market will shift in the coming months.

On the software side, I’ve acquired enough anecdata to believe that many business-oriented SaaS companies are seeing net neutral growth — that is, the amount of accounts churning out is equivalent to the amount of revenue generated from new customers. This is important to me, because it determines the sorts of companies I would have to apply to if it all goes south. Like the job market questions, I continue to investigate this in as many ways as I can — if a startup operator even hints at talking about the pandemic’s impact on them in the shownotes of a podcast, I’m likely to download the episode and give it a listen.

One thing that is clear from these early conversations is that my ‘set up and run a regional office for you’ moat is mostly diminished in value. I do have two backups: I’ve been writing Commonplace as an exercise in building content marketing chops, and I’ve been doing marketing for a friend’s business intelligence company on a freelance basis on the side. I give myself an ‘ok’ grade here; my real value is that I’m able to write compellingly on several highly technical topics. So I could fall back on this skill if necessary, but the value of my offering here isn’t at the same level as compared to my primary moat.

The last option I have is that I can just grind data structures and algorithms for a couple of months and get hired as a software engineer — but this is an undifferentiated skillset, and I regard this option as a last resort.

The point I’m making isn’t that I would have to give up on my current entrepreneurial efforts and jettison out to get a job anytime soon — in fact, recessions are often good for entrepreneurs who have no existing obligations — my point is to treat information-gathering as an explicit activity, even if (or especially if!) you have a career moat of your own. Career moats depend on the supply-side and demand-side characteristics of the job market you’re in; you really do want to check if there are changes to the demand for your skills during this period.

And you don’t have to take that much time to do it.

Information Gathering as an Explicit Practice

What do I mean by ‘not much time’?

One habit that I learnt as a manager is that it always pays to evaluate your information channels explicitly. When I was running the Vietnam office at my previous company, I made it a point to review my information source choices once a month. If you do this, like I did, you’ll quickly discover that you can control the amount of time you spend on information gathering activities.

Information channels may be evaluated along three different axes:

1. Accuracy — a formal project report compiled by some team in your company is likely to contain accurate information; a rumour from Joe in sales is less so.
2. Timeliness —  conversely, the rumour from Joe is a more timely source of information than a formal project report; you might want to nurture more such sources, depending on your needs.
3. Effort — how expensive is it to get useful information? Face-to-face meetings are usually the worst; short memos are often the best.

Ideally, you want a good mix of accuracy and timeliness in your channels, with some redundancy built in so you can verify bits of information with information acquired through a different channel. And you’ll want to curate your channels with an eye on the effort you’d have to spend on each of them. Intel CEO Andy Grove famously devoted some time each week to sample customer complaints — this was his way of getting timely and accurate information of downstream problems within the company, even if it came at the cost of some extra work. He did this even though he spent a huge amount of time retrieving information conventionally, via written reports, internal memos, and staff meetings.

What equivalent information sources exist in a job market? I’m still actively searching for new ones in mine, but off the top of my head:

1. Calls with friends and ex-colleagues serve as an important source of information exchange, albeit with large time costs and potential accuracy issues. (Though such meetings are usually quite important anyway, because relationships and friendships matter).
2. Listening to startup operators in the region on their experiences with the pandemic conveys which sectors are likely to be hit in which ways.
3. Complaints from friends about work serve as a redundant source of verification of (2).
4. Reading job listings are a traditional source of job market information — but listings often aren’t timely, especially not during a recession like this one. Combine this observation with the fact that the most important jobs are rarely listed on a job board, which means that you should downweight this information source the more senior you get.
5. News of layoffs are low-effort to keep track of, though it’s questionable the value of the information you gain from them.
6. And, finally, I’ve been experimenting with a technique I learnt from Brandon Ong (who used it on me): the idea is to pick people with useful vantage points into your industry on LinkedIn, connect with them, and then ask for a 15 minute Zoom call to pick their brains.

You’ll have different sources for your industry; the point is to be deliberate about testing and acquiring new ones.

Wrapping Up

If you’re comfortable in your job and believe that you don’t have anything to worry about, that’s good. Carry on. But for a good portion of us, I think it is still rather useful to do a ‘job market audit’ like I’ve described above. When doing so, curate your information sources explicitly, so it doesn’t take too much of your time.

As the old saying goes: “take care of the downside, and let the upside take care of itself.” Or, as I prefer to put it: how do you know if your career moat is holding up well? The answer is simple: you check.

Godspeed and good luck.

Originally published 11 August 2020, last updated 21 November 2020.