This is one of the things which we like to say about startups, but it doesn't stand up under scrutiny.
The competing job offer is Google or another megacorp. What's their turnover for engineers in a year? 10%? 15%? The definitionally average startup has a higher turnover even if we restrict it to turnover caused by business failure, to say nothing of voluntarily or involuntarily losing one's job.
If you exit a position with Google/etc, you have a network full of people who also spent the last couple of years at Google. You can easily lateral into jobs of comparable quality. If you exit a position with a failed startup, your lateral transfer is likely into another job which pays below market. Your immediate professional peers are also people trying to avoid the failure stigma. They may also be slightly busy looking for a job to help you with your own job search.
If you work for Google for 2 years and then separate from them, your 401k increased by $30k in the interim and you probably have six figures sitting in the bank account. If your startup is shot out from under you, you may end up counting the number of ramen boxes in the pantry while hoping that the startup can make good on its final payroll check.
If you work for a megacorp and are let go, it is highly likely that you were let go for firm- or individual-specific reasons rather than industry-wide calamity. This is very much not guaranteed in startups, where e.g. ebbs and flows of the capital market can cause a daisy cutter to hit the hiring pipelines at dozens of firms at once. You could lose your job at the same time that everyone else stops hiring. Ask the wizened veterans of the dot com bust who are, what, in their late 30s?
Startups are meaningfully less secure than working at bigco. Anyone who says differently either doesn't understand them or is trying to sell you something.
For engineers above a certain skill level it's difficult to imagine job security becoming a real concern in the foreseeable future.
You're certainly correct about the opportunity cost of forgoing higher guaranteed comp at a BigCorp in return for a potentially higher reward, but I don't think that directly relates to the question of job security.
Do you remember 2001? One moment everything was brilliant. a year later and I had people who were working alongside me... people who were better than me in the late '90s... working for me, because their other option was retail. "I can't pay you what you are worth," I said to an ex-coworker I found working in a sandwich shop in the mid-aughts, "But I can pay you more than this place does." The guy really was pretty good, and he ended up working for me for many years.
Now, maybe we are in a bubble and maybe we are not, but the tech sector has a history of very sharp ups and downs, and in the downs? my experience is that a lot of pretty good people end up un[der]employed.
The other interesting thing is that from what I've seen? Layoffs at big companies (and if the sector takes a dump, there will be layoffs) are generally more "fair" than interviews at the same places. By that, I mean that those people who are shy but good are often the last to get laid off, but beyond a certain level, when interviewing, the "shy" part hurts you more than the "good" part helps you.
When Sonicity failed in 2001, I had a track record as a lead developer on a successful, well-reviewed enterprise product, the lead engineering role at an ISP that might still have been among Chicago's most popular, and research publications at least one of which has a cite record that a lot of ACM journal submissions would envy. Not to mention, I had cofounded a company that had raised a significant amount of money. I was living in San Francisco at the time.
I had to move to Ann Arbor to find my next job.
The thing about the daisy cutter that Patrick said is not a myth. If you're one of the people here that believes we're in a bubble, you should take it seriously. They didn't call 2002 "Nuclear Winter" for nothing.
When my employer failed in 2002, I had no trouble getting another job offer. Unfortunately that company failed before my start date. As did the one after that.
I moved to NYC to get a semi-functional job market.
These days the possibility of highly correlated failure is a major component in my career decisions.
No but at least if I lose my regular job I don't lose the pay I've already received.
If I'm paid $100k pa at Regular Corp and I get laid off after 1 year, then I keep the 100k I've already been paid.
If I'm paid $50k pa and 5,000 options at Startup Inc and I get laid off then I'll probably end up forfeiting the options which leaves me 50% worse off than if I'd worked for Regular corp.
Sure, but you're less likely to be fired at short notice from a big company. Unless you do something stupid or illegal you will be put on a performance plan and have some time to get your act together. Lets say you're working at a startup on a h1b visa, if they decide to let you go with little notice you have a limited amount of time to line up another job or leave the country.
