Dive Brief:
- Zillow is grappling with talent retention in the "highly competitive job market for tech and product talent," said Rich Barton, co-founder and CEO, speaking during the company’s Q2 earnings call Thursday for the period ending June 30.
- “Practically speaking, it would be more expensive to recruit and replace valuable employees tomorrow than it will be to retain folks today,” Barton said. “Attrition and churn is an insidious barrier to growth."
- The company issued off-cycle restricted stock units to bump up compensation for employees, particularly those in competitive job categories, Barton said. Zillow's employee retention plan will involve the issuance of 4.5 million to 6.5 million RSUs, which will vest over the next few years, and result in an estimated 2% dilution. The company expects the plan, effective Aug. 8, to cost between $180 million and $190 million.
Dive Insight:
Zillow is one of many businesses fighting to retain tech talent. Currently, the IT unemployment rate is sitting at 1.7%, less than half a percentage point above the historic low recorded in May 2019.
Despite tech giants like Google and Microsoft, with plans to pause or slow hiring, businesses are struggling to keep talented employees, who have no shortage of opportunities.
Zillow, a real estate marketplace, is seeing continued customer interest, with visits up 5% year-over-year, and an average of 234 million monthly users for Zillow Group apps. The traffic growth requires taking a more advanced technology approach.
“As we transition, we need to build digital tools for customers that are native in our asset sites, technology to support customers across our platform as well as efficient tools for loan officers and agents to serve these customers with a high level of transparency and integration between all parties,” Barton said.
However, Barton said the company would not scale its technology without having the “key foundational components” intact, which will require a skilled tech talent portfolio.
