Subcribe

STEM Shortage Claims and Facebook’s $19 Billion Acquisition of WhatsApp


Tech titan Facebook’s recent acquisition of WhatsApp for the bargain basement price of $19 billion in cash and stock (slightly less than the inflation adjusted cost of the Manhattan Project) generated a spate of news articles noting that both WhatsApp co-founders Brian Acton and Jan Koum had been turned down for jobs at Facebook. Notably, Brian Acton seems to have gone through an extended job hunt in 2009 and was turned down by both Facebook and Twitter (at least according to his Twitter feed :-) ).

Both Acton and Koum had years of experience as paid professional software engineers at Yahoo at the time they were turned down by Facebook. Acton is a graduate of the top-rated Stanford University as well. It is difficult to see a substantial technical difference between Yahoo and Facebook; both are gigantic “free” web sites with a range of services such as search, messaging, and e-mail supported by advertising dollars. Both engineers seem like excellent prospective employees for Facebook at the time they were each turned down.

Facebook, it may be noted, has been prominent in claiming that it cannot find qualified software engineers through a range of groups including FWD.us, code.org, and Compete AMERICA.

The widely watched code.org “What Most Schools Don’t Teach” inspirational video contains a statement (starts at about 3:00) by Facebook CEO Mark Zuckerberg:

Our policy is literally to hire as many talented engineers as we can find. The whole limit in the system is just that there aren’t enough people who are trained and have these skills today.

The turndowns of Acton and Koum suggest that Facebook’s problem, if real, lies in Facebook’s hiring practices rather than in any genuine shortage of qualified software engineers. Simply put, Facebook and many other technology companies are excessively and irrationally picky in hiring, ignoring or turning down many highly qualified applicants.

Qualified but Can’t Get A Job

The WhatsApp turndown stories are not unusual even in media coverage of the technology industry, which, with rare exceptions such as Patrick Thibodeau’s coverage at ComputerWorld, tends to parrot industry claims of a desperate shortage of qualified software engineers and other STEM professionals. Every few months, in fact, brings articles and personal accounts that often describe great difficulty in finding jobs in the technology industry despite what appear to be impressive qualifications.

I recently wrote about Chand John’s article The PhD-Industry Gap in The Chronicle of Higher Education about his lengthy search for a job, despite graduating with a Ph.D. in Computer Science from Stanford’s highly rated computer science program.

Jennifer Wedel gained national news coverage when she described her husband, out-of-work semiconductor engineer Darin Wedel’s lengthy and then unsuccessful job hunt after being laid off by Texas Instruments, to President Obama in an online Q&A session. These published accounts match many “anecdotal,” word-of-mouth accounts that I have heard or, to some degree, personally witnessed.

It is always difficult with individual cases to be sure of the reasons and to know all of the particulars. For example, Darin Wedel was (is?) unable to relocate out of Texas due to a child custody situation. He reportedly received several offers from major technology companies for jobs outside of Texas following his wife’s Q&A session with President Obama. Industry apologists have tried to use this to dismiss his case as irrelevant. However, in this era of e-mail, Skype, and many people working successfully in the technology business from a large distance (e.g. India or China), why exactly couldn’t the desperate “starving” technology companies offer him a job he could do from Texas? Not so clear. There are also many technology companies in Texas such as Texas Instruments and Dell. But apparently they are not all that desperate either. :-)

Thus, there may have been good reasons why Facebook turned down Acton and Koum, despite their seemingly impressive credentials and Facebook’s recurrent claims of being unable to find qualified applicants. It is pretty unlikely that the problem was that Acton or Koum could not program — “code” in current parlance. Neither dismal public schools that don’t teach “coding” nor restrictive US immigration policy (Koum is an immigrant from the Ukraine who allegedly lived on food stamps at one point) can explain the turndowns. As veterans of Yahoo, both Acton and Koum certainly look like genuine “purple squirrels” with exactly the technical skills that Facebook was seeking and needed in 2009 — before the current mobile mania began.

Qualified or Young?

One thing that stands out is age. Both Acton and Koum are old by Facebook standards. Acton was born in 1972 and would have been 37 in 2009, well over the magic age of 35 when software engineers often begin to informally report encountering difficulty finding jobs despite impressive qualifications.

Facebook founder Mark Zuckerberg has been quoted as saying: “Young people are just smarter. Why are most chess masters under 30?” Incidentally, the statement is debatable. World Chess Champions since the FIDE (the Fédération internationale des échecs or World Chess Federation) chess championship system was established in 1948 are about evenly split between under 30 and over 30. In fact, the world champion at the time of the reported quote (2007) Viswanathan Anand was thirty-seven and was forty-three when Magnus Carlsen finally defeated him in November 2013. Zuckerberg was born on May 14, 1984 and will turn thirty this year.

In addition, in 2009, Acton would have had over ten years of paid professional experience as a software engineer. It is rare to encounter job advertisements for software engineers or other STEM professionals with more than ten years of experience. This is even true in exceptionally complex fields such as molecular biology where ten years is almost certainly too short for even very intelligent people to master the field.

One may note that it is theoretically illegal to discriminate on the basis of age in hiring in the United States. :-)

Water, Water, Everywhere, but Not a Drop to Drink

In fact, technology companies appear to be extremely picky in even choosing to interview applicants, let alone actually hiring them. This pickiness alone probably accounts for the perceived “shortage” of “qualified” applicants. It also explains why a minority of software engineers who fit or appear to fit the extremely narrow, rapidly changing, and often unstated criteria of the tech companies report fierce competition and multiple job offers, while many others like Chand John or Darin Wedel (and perhaps Brian Acton in 2009) report a long frustrating job hunt.

Empirically, many factors separately or in combination seem to frequently push software engineers out of the “hot” software engineer category into the “unqualified” category despite impressive actual qualifications. These include:


  • Less than three years of paid professional experience working for a commercial firm.

  • More than ten years of paid professional experience

  • Over 35 (sometimes over 30)

  • Look over 35 (even worse)

  • Gray hair (really bad)

  • Has a Ph.D.

  • Freshly minted Ph.D. (even worse)

  • Membership in some low-status “minority” groups (e.g. Black or Hispanic with American Indian Ancestry)

  • Female

  • An extended period of recent or current unemployment — over six months

  • Lack of a college degree

  • Stated skepticism about currently “hot” technologies even if knows them (e.g. the applicant thinks Git is an awful version control system after using Git for years)

  • Scores perfectly on a coding test interview (better than interviewers could do) :-)

  • Just plain different in some other way

Note that I am not endorsing any of these often hidden criteria. Some in fact are illegal in the United States. Nor am I arguing that they are consciously used — although I believe they are used consciously in some cases. The requirement of three years of paid professional experience, for example, is frequently explicitly listed in job advertisements and job descriptions for software engineers and other STEM professionals. Neither am I arguing that these criteria are applied by all tech companies or by guilty companies all of the time.

I use the phrase “Hispanic with American Indian Ancestry” in my list for the following reason. The Silicon Valley is located in California. According to census data, about thirty-seven percent of Californians self-identify as Hispanic-Latino. Nonetheless, it is fairly rare to encounter Spanish surnames in Silicon Valley tech companies, especially among software engineers. Among those rare software engineers with Spanish surnames, people with obvious American Indian ancestry seem rare, although this is common among Hispanics as a group in California. And yes I have met software engineers and other STEM professionals with Spanish surnames and obvious American Indian ancestry in the Silicon Valley and Southern California.

I use the phrase “some low-status minority groups” to distinguish these groups from minority groups such as Asians and Indians (from India) who are common in software engineering — heavily overrepresented, in fact, in comparison to their proportion of the US population. Social status seems to be the key issue rather than simply membership in a minority group.

Incidentally, with respect to my list, according to news reports Jan Koum dropped out of San Jose State University and presumably lacks a college degree. According to news reports, both Acton and Koum “took a year off to tour South America” not long before applying to work at Facebook, giving both a recent period of prolonged unemployment.

Yes, Mark Zuckerberg is also a college dropout, but tech CEO’s often appear to apply a different standard to people they hire than themselves.

Conclusion

Facebook turning down the founders of WhatsApp and then paying $19 billion for their company a few years later is probably simply another example of the extremely picky hiring practices of technology companies, a pickiness that frequently appears unrelated to actual technical “qualifications.” Technology companies can probably solve their “shortage” by discarding hidden and/or unconscious non-technical criteria as well as discarding excessively narrow “purple squirrel” technical requirements in hiring software engineers and other STEM professionals. Doing this will save them time and money (possibly $19 billion in Facebook’s case) and even make the world a better, fairer place at the same time. :-)

© 2014 John F. McGowan

About the Author

John F. McGowan, Ph.D. solves problems using mathematics and mathematical software, including developing video compression and speech recognition technologies. He has extensive experience developing software in C, C++, Visual Basic, Mathematica, MATLAB, and many other programming languages. He is probably best known for his AVI Overview, an Internet FAQ (Frequently Asked Questions) on the Microsoft AVI (Audio Video Interleave) file format. He has worked as a contractor at NASA Ames Research Center involved in the research and development of image and video processing algorithms and technology. He has published articles on the origin and evolution of life, the exploration of Mars (anticipating the discovery of methane on Mars), and cheap access to space. He has a Ph.D. in physics from the University of Illinois at Urbana-Champaign and a B.S. in physics from the California Institute of Technology (Caltech). He can be reached at jmcgowan11@earthlink.net.


If you enjoyed this post, then make sure you subscribe
to our Newsletter and/or RSS Feed.


13 Responses to “STEM Shortage Claims and Facebook’s $19 Billion Acquisition of WhatsApp”

  1. In reality, there is no shortage of Software Engineers nor Scientists, nor is there is a shortage of trades that support Software Engineering such as Software Quality Assurance Engineers, Web Designers, Project Managers and the like.

    In part the problem is that new hires are expect to “Hit The Ground Running” because management is no longer willing to pay for on the job training anymore.

    Thus with my degree in Physics, 26 years as a coder, 14 years of C++ experience, a year of Java, 4 years embedded, device drivers on various platforms, having learned C in school in 1984, I found it flatly impossible to get a job as an iOS developer because I do not yet have an App in the App Store.

    Another problem is that recruiters – not so much in-house recruiters but third-party recruiters or “headhunters” – do not have a clue about the skills, technologies or toolsets required of the candidates they attempt to place.

    How many recruiters can get Hello World to comply with specification and run to completion in any language at all?

    So what we have is that those who are looking for work, as was my own experience, cannot convince the recruiters to place us in jobs we are qualified for.

    And the hiring managers cannot convince the recruiters to Read enough of The Fine Manual so that they know the difference between a qualified candidate and an unqualified one, as a result the hiring managers get very few qualified submssions.

  2. Doug says:

    “…it is theoretically illegal to discriminate on the basis of age…” No, it IS illegal to discriminate on the basis of age but it DOES happen all of the time. When I was younger I was not hired for looking too young (I was carded at 21 to enter an R rated movie) and I have not been hired for being considered too old, even if perfectly qualified for a position. It is difficult to prove even if you are told it directly and you almost never see an age discrimination lawsuit based on hiring, since it is so difficult to prove. The majority of age discrimination lawsuits come from people who are already hired and aren’t able to rise in the ranks or are fired because of their age.

  3. Seriously? says:

    You’re kidding, right? Aside from that fact that you’ve just made a pretty serious claim with absolutely no support,
    1. Facebook uses a totally different platform then Yahoo
    2. Actom and Koum built a messaging platform designed on Haskell and JavaEE – neither of which Facebook uses at all.
    3. Their careers at Yahoo weren’t very well noticed. Remember, they LEFT to go work on a super risky startup.
    4. You don’t know what Empirically means. At all. Not even a little bit. You are banned from using that word until you locate a dictionary.
    5. Your list is just plain wrong. Entirely wrong.

  4. […] post over at Math Blog. There is no short of STEM folks in the US, and hasn’t been for a long … long time. Any […]

  5. From a recent NY Times article –

    “Just six of the 32 companies it looked at had a median age greater than 35 years old.

    The seven companies with the youngest workers, ranked from youngest to highest in median age, were Epic Games (26); Facebook (28); Zynga (28); Google (29); and AOL, Blizzard Entertainment, InfoSys, and Monster.com (all 30).

    According to the Bureau of Labor Statistics, only shoe stores and restaurants have workers with a median age less than 30″

  6. Arnor says:

    sorry, small correction. The Manhattan Project actually cost $26 billion in current dollars according to Wikipedia (based on consumer price index, not sure how much that makes sense, but alas)

    https://en.wikipedia.org/wiki/Manhattan_Project

  7. Forrest Pruitt says:

    I enjoyed this post, but I feel like the premise is a little weak. There is no telling what positions these two were seaking. They might have been applying to a specific position that they, in all honesty, might not have been qualified for.

    There is also frequently the consideration of ‘fit’– how well you are predicted to work with the current team. This is as much a behavioral issue as it is a skill issue; they may have been more than qualified technically but lacked some other desired quality. It’s not ‘picky’ to know what you need in a new hire.

  8. anon says:

    Yeah, I interviewed with them recently. I have ~5 years of exp and was interviewed by people who had max 1 year of exp.

    Concepts such as design patterns were alien to them. Heck one of them thought I was bullshitting him the whole time. If even 25% of people have an experience similar to mine, I am not surprised they can’t “find” good talent.

    It felt like a frat house, honestly. Heck one of the kids told me I should watch Breaking Bad. “It’s dope man!”

  9. SagarM says:

    In this case i feel FACEBOOK is lucky that they have not hired WHATSAPP guys in 2009 or so.

    Because, though they paid 19 Billion to WHATSAPP founder, but the BIGGG thing is that it has given FACEBOOK one more PRODUCT to earn money. Think Positive.

  10. Jack Hill (Taft 1961) says:

    I encountered a situation similar to what your report in the blog entry.

    After successfully running a small software design and consulting firm (small because I was one of the primary coders/designers) with a wide variety of experience, published articles, and since day 1 experience (I was attending a well-respected Ivy League institution from whence I graduated, when they brought up an early campus-wide time-sharing network) and was repeatedly put before companies looking for the kinds of experience I (and damned few others) had, but because I was of a certain age and in spite of being technically atop my field, even interviews were hard to come by…

    Knowing that age discrimination is illegal, albeit far too common, I altered my resume to include only recent experience and marveled at the results… evidently, Human Resources people at Tech companies are not the brightest of the bunch – One could easily figure my age from when I graduated from college – based upon the shocked faces of the interviewers when they met me.

    Of course they found ways to hire someone else without saying outright they thought I was too old… I got even by gaining a Special Education teaching credential, working 11 more rewarding and productive years, finally retiring at age 70!

  11. […] don’t know if you saw this post, STEM Shortage Claims and Facebook’s $19 Billion Acquisition of WhatsApp. The author claims we have rampant ageism in technical hiring. He’s […]

  12. David Eaton says:

    I have a PhD in Chemistry. Physics and math were first loves, but a fellow has to eat, and unemployment in the field is usually very low, even when the economy is in the crapper. Some friends in pharma have had problems keeping the same job, but few go without for long.

    I can’t imagine the ageism. Chemists get better with experience, no doubt, though I wonder what it is that Facebook wants to do that would devalue experience entirely in favor of creativity or whatever magical powers they ascribe to youth.

Leave a Reply

Current day month ye@r *