Here's what could turn around Massachusetts' biotech job market in 2024

Among biotech companies, employees and recruiters, it’s no secret that 2023 was a rough job market.

“This is the longest bear market the life sciences industry has ever been through,” said Matthew Toner, co-founder and CEO of LifeSci Search, a global executive search firm.

With the benefit of hindsight, recruiters working in the life science industry spoke with the Business Journal about how the down market in 2023 impacted jobs. Recruiters also offered insight for the 2024 job market, including what may turn this year into a better market for job seekers.

What went south in 2023?

Looking back, there were around 70 life sciences companies that laid off nearly 4,000 Massachusetts employees over the course of 2023. Close to 20 local biopharma companies closed their doors last year.

Carina Clingman, founder and CEO of Recruitomics Consulting, which helps with hiring, retention and human resources for early-stage biotech and medical device companies, said last year got worse as it went along. In the first half of 2023, her firm opened up 15% fewer jobs than in 2022. In the second half, it opened up 75% fewer jobs.

“We started to see a little bit of a decrease (in early 2023), but it really picked up starting last summer…I think that was when runways were actually running out,” Clingman said.

Toner noted that a “market correction” was in order coming out of the Covid-19 pandemic. Investment in life sciences companies reached record levels in 2021, including from investors new to the industry. In many cases, that extra cash led to hiring sprees. When cash became more difficult to find in the last 18 to 24 months, that led to layoffs at many companies.

Ryan March, senior managing director at Stratacuity, a Portsmouth, New Hampshire-based boutique biotech staffing agency, said that even those companies that weren’t laying off workers were hesitant to hire the newly available talent. Instead, many were looking over their shoulder, wondering if they might be next.

Is there a turnaround ahead in 2024?

While it’s still early to tell whether 2024 will see a marked improvement in the life science job market, Clingman said chatter in the biotech community coming out of the JP Morgan Healthcare Conferences paints an “optimistic” picture for the year, Clingman said. She said she’s on the lookout for companies going through IPOs and getting funding to fuel their hiring. 

Last week, Fractyl Health became the first Massachusetts company to go public in 2024, and the fourth life sciences company so far this year. The Lexington company raised $110 million in its IPO. That’s compared to just 19 biotech companies that went public last year, per a BioPharma Dive tracker, including two Massachusetts companies.

Clingman said she’s also already seen some early-stage biotechs land partnerships with larger companies. 

“That does give people an avenue within the company even to shift into a role within the bigger parent organization if it’s a partnership or a buyout event,” Clingman said.

However, there's some concern about the Federal Trade Commission blocking deals, March said. That could have ripple effects on companies’ ability to partner and grow. March pointed to the FTC’s December decision to try and block Sanofi’s proposed acquisition of an exclusive license to Maze Therapeutics Inc.’s Pompe disease treatment as an example.

Mergers and acquisitions are a big driver in the current market, March said, in part because a lot of Big Pharma companies are reaching the end of exclusivity on their patents and “looking for ways to replenish their pipelines.”

Despite generally positive signs that the biotech market, and therefore the job market, is improving, Toner, March and Clingman agreed the industry is still in a “wait and see” period — at least in the first half of 2024.

Most companies, she said, “don’t want to be the first one to go out and do something, they want to see someone else go out and do it before they do,” Toner said.