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We came into 2023 on a high thanks to our 10th anniversary in 2022 and great job placement success on the part of our graduates. And we celebrated a few notable milestones this year, including graduating the first cohort from our Software Engineering with Java/AWS Specialization program in February. In October, we received welcome recognition of our efforts to provide opportunities for tech careers to all qualified adults. The Nashville Business Journal selected us as a member of their inaugural class of Nashville Leaders in Diversity. We greatly appreciate the recognition of our efforts to provide opportunity to all and to help employers create a more diverse tech workforce, as our impact reports over the years have demonstrated. Yet I’m afraid we can only give ourselves a grade of “Incomplete” for 2023.
There were headwinds that could be felt early in the year - and that increased as the year went on. The overall job market for tech talent was the softest we have seen in the past eleven years. It started with the highly visible layoffs among the major tech industry players in the fourth quarter of 2022 and continued to expand, driven by a cyclical correction to overexpansion and overinvestment by the major established tech companies as well as investors and growth-stage / emerging tech companies. Enterprise IT employers in some industries also slowed or froze expansion of their tech workforce due to recession fears, inflation, etc.
As a result, hiring for junior talent, particularly software developers, dramatically slowed and has not yet recovered. Average job search times for graduates are at a level that we’ve only seen once before and that was during the six to eight months of uncertainty that followed the onset of COVID-19 in 2020. Slow placement cut deeply into placement rates for graduates from our cohorts in late 2022 and throughout 2023. Since placement of graduates is the most important metric for how we evaluate our own performance, we can only view our job as half done for 2023. Graduating qualified talent is simply not enough - we totally reject the “butts in seats” mentality that is unfortunately so prevalent in higher education. The statistics shared below provide more detail on the impact of longer job search times on our graduates.
We continue to provide career placement support for all graduates that have not yet secured their first job. In light of the historically long job search times for this past year’s graduates, we have stepped up our support of Seekers (graduates who have not yet found their first role using the skills they learned at NSS) by making weekly workshops / seminars available along with dozens of one-on-one support sessions with our career development team.
A second headwind developed as the year went on in the form of economic pressures, including cumulative impacts of the “COVID economy” of the last three years as well as more recent factors such as inflation, interest rates, and most recently the restart of student loan repayments, that have measurably impacted the ability of potential career changers to afford tuition and living costs associated with vocational training. As a result, we have seen proportionally more applicants that can only attend NSS if granted Opportunity Tuition or some other form of financial assistance and a corresponding decrease in full tuition applicants.
The combination of low placement rates and reduced enrollment of students paying tuition fees has weakened both legs of our operational model and forced us to rethink and reduce our expenses, including reducing the number of classes we deliver.
As a result of the challenges to our underlying operational model outlined above, we continued and intensified our recent efforts to add donations, particularly for scholarships, to supplement tuition revenue. Notable successes this year included $50,000 grants from Ingram Charities and the Scarlett Family Foundation and adding our first Director of Development, Ann Howard, who joined us late in the year. We’ve also launched a new giving section on our website where donors can learn about NSS’s impact and more easily make a donation.
I feel I’d be remiss if I didn’t mention the unexpected departure of our friend and colleague, Amy Henderson. So many of you know Amy from her engagement in the community. She was our Chief Operating Officer from the beginning of 2019, and before that a member of our Board of Directors, an executive hiring NSS graduates, the parent of two NSS graduates, and a great supporter in the community. Amy was faced with serious family health issues that led to her first taking a leave of absence and then resigning as COO and as Director so she could care for her family. Amy's calm presence and executive skills were an important factor in doubling the number of annual graduates, moving from in-person to remote, and navigating the last several years of COVID disruption. On behalf of all of us in the NSS community, I want to thank Amy for her many contributions to the success of NSS and of our graduates and to wish Amy and her family the very best.
We expect the slow job market and economic pressures to continue into 2024, but are cautiously optimistic with the number of employers who hope to start hiring again early next year and with our plans to grow our fundraising efforts. One thing that hasn’t waned during this difficult year is our team’s dedication to our students and Seekers. Everyone on our team was asked to take a temporary pay cut to allow NSS to navigate the strain on our operational model and several volunteered to take even larger pay cuts or furloughs. I was deeply touched by this demonstration of our team’s commitment to the purpose and mission of NSS.
Even with the challenges of 2023, we still were able to have a meaningful impact on the lives of our students, graduates, and the Middle TN tech community. Below we’ll break down the numbers, what they mean, and how we’re continuing to support our students and Seekers.
