Tech layoffs are set to worsen early next year amid ongoing global macroeconomic conditions
December Jobless-Claims Data: The last month of the year is often the second-highest month for job cuts. January is worse. Led by companies like Meta, Amazon, Twitter, Microsoft, Salesforce, and others, the tech layoffs are robust and set to worsen early next year amid ongoing global macroeconomic conditions. According to a MarketWatch report, tech layoffs are part of a strategy by firms to maintain viability through 2023 and beyond.
Data from layoffs.fyi, a crowdsourced database of tech layoffs, showed that 1,495 tech companies have sacked 246,267 employees since the onset of Covid-19, but 2022 has been the worst year for the tech sector and early 2023 can even be grimmer.
As of mid-November, more than 73,000 workers in the US tech sector have been laid off in mass-level job cuts led by companies like Meta, Twitter, Amazon, Netflix, Cisco, Roku, and others.
No Tech hiring only Tech firing:
Reports of Cisco considering firing employees surfaced last month. The networking company is said to have laid off around 5 percent of the workforce, which is over 4000 employees. It is said that the layoffs are a part of “rebalancing” act while “rightsizing certain businesses”.
As quoted by the report, Cisco hasn’t directly commented on the layoffs but said in an official statement that it “didn’t take this decision lightly” and “will offer those impacted extensive support, including generous severance packages”.
The report quoted Chuck Robbins, Chairman and CEO of Cisco, who did not divulge into giving direct details related to layoffs but said he would “be reluctant to go into a lot of detail here until we’re able to talk to them. I would say that what we’re doing is rightsizing certain businesses”. “You can just assume that we’re going to — we’re not actually — there’s nothing that’s a lower priority, but we are rightsizing certain businesses,” Robbins further told analysts.
Thousands of job cuts have also hit other industries, with Ford Motor Co., Walmart Inc. and PepsiCo Inc. all reducing their head counts, leaving many employees to wonder: Could I be the next?
Historical data shows December often ranks as the second-highest month for layoffs and discharges, going back to 2000, according to the Bureau of Labor Statistics. But the month when companies would consistently cut the most workers is coming — which is January. (The pandemic made 2020 an outlier year when massive layoffs were recorded in March and April as Covid-19 spread and lockdowns went into effect.)
Layoffs around the holidays are a relatively recent phenomenon. In the 1970s and 1980s, companies were more cognizant of the optics of putting people out of work during the most wonderful time of the year, says Andy Challenger, a senior vice president with Challenger, Gray & Christmas, a career services and executive-coaching firm.
Google is reportedly bracing for a massive layoff early next year and Alphabet and Google CEO Sundar Pichai has reportedly offered no assurance to worried Google employees that it won’t happen.
In a companywide meeting with staff, Pichai said “it’s really tough to predict the future, so unfortunately, I can’t honestly sit here and make forward-looking commitments”.
He told employees that what the company is trying hard to do “is to make important decisions, be disciplined, prioritise where we can, rationalise where we can, so that we are set up to better weather the storm, regardless of what’s ahead”. “I think that’s what we should focus on and try and do our best there,” Pichai added.
