Before we talk about the massive layoffs, analyze the situation with these:
Slapped with a pink slip after 20 years at Google amidst the current mass layoffs.
College graduates hired by the Big 4 told to resign within three months of employment.
A phase when employees were unwilling to work despite the best job offers (great resignation) to when their access to Slack and emails because they were fired.
Tech workers moving to US from China, India and other countries being fired within three months of service on-site?
Recession in the making? Home sales slide because tech workers are some of the major buyers of real estate in the US.
And the dreams keep crashing with the current mass job cuts in the IT/technology sector. The shocking stories are all over Twitter and other platforms. Once called the goldmine, tech jobs have lost the luster after the second big collapse – first, the dot-com bubble crash in 2000 and now the post-pandemic disaster in the form of mass layoffs across tech companies, including the Big 4.
Layoffs in the technology sector – Dreams shattered
Massive layoffs across the tech industry have shaken the faith of everyone who saw the industry as recession-proof. From Google to Amazon and Microsoft to Meta, workers are being fired with the first round of layoffs in most major companies ranging from 10000 to 20000 employees.
The tech boom that started around 2010 lasted almost a decade and crossed every economic milestone during the period. Tech companies were adding almost an average of 100,000 employees yearly since 2010 and around 2.5 times that number (260,000) in 2022 alone, even though the mass layoffs across tech sector had started in the latter half of 2022.
Working in tech sector was not just about a fat paycheck and a big name that added value to your resume. For everyone – millennials, Gen Z and Gen X, it was also about a grand lifestyle, flexibility to switch from one job to another anytime, job security greater than any other industry, work in different locations across the globe and much more.
Free meals (breakfast, lunch, dinner, array of snacks), free online courses and tuition reimbursements, on-site gym and aerobics centers, free health and wellness programs (massage therapists, physicians, chiropractors, yoga instructors), free to and from air-conditioned, Wi-Fi enabled shuttles, fully-paid vacations and much more.
Suddenly, it is all over for hundreds of thousands of tech workers. Mass layoffs in tech are happening, and the layoff tracker is keeping the employees busy. Those laid off are in disbelief, especially the younger employees who joined the tech sector after the dot-com bubble burst. They are trying to come to terms because layoff means a big economic, social, and personal shock for them. While tech workers who have already been laid off are learning to live with the new reality, the currently employed ones are preparing for the worst.
The possible reasons behind the mass layoffs in tech companies
It was a similar state of affairs then, and this time, it might be even bigger due to the hiring boom after the tech industry saw an unprecedented expansion during the pandemic.
The pandemic era saw a dream run for every tech company – stock prices soared to new levels, startups were getting funding easily, every app boasted millions of active users acquired in no time, every new tech IPO was a big success, the cryptocurrency industry topped the three trillion mark. Such frenzy in the technology sector meant an acute talent shortage in the industry despite bulk hiring by every startup and established company.
What led to the massive layoffs in the tech sector soon after such a glorious period is still unclear. Almost every company firing employees is attributing the layoffs scenario to misjudgment in business growth potential in the future.
The CEOs and founders are mostly talking about how they miscalculated the future growth projections riding on the sudden surge in business during the pandemic period, which led to an increase in hirings across all verticals. The overambition of tech companies related to economic growth meant everyone, from freelancers to college freshers, received job offers.
From being the most secure and highest-paying sector, tech is now the major sector facing the heat of the downturn, whether due to the recession forecasts or the excess hiring led by miscalculated business forecasts. Experts are even calling it a small reversal of pandemic hiring, which could mean many more rounds of layoffs in the future.
From high-paying software programming to cybersecurity jobs and data science to AI and ML, it is not only the software side that has taken a hit. It is also the hardware, networking and support and all other allied services that are part of mass layoffs.
Layoff tracker – Job cut data and figures
To put in perspective the quantum of layoffs, here is some data:
1035 tech companies laid off 158951 employees in 2022.
Within the first three weeks of 2023, 173 tech companies w/ layoffs ∙ 55970 employees.
The list of 10 biggest tech layoffs by the end of Jan 2023: (collected from various news sources. For more information, please refer to official sites, social media handles)
Google – 12000
Meta – 11000
Amazon - 18000
Microsoft – 10000
Salesforce – 8000
Booking.com - 4375
Cisco – 4100
Philips - 4000
Twitter – 3700
Uber – 6700
The list is quite long, with the total number of companies being over 2000 at present. The Layoff tracker is constantly updated, looking at the layoff announcements coming from different companies daily.
You can refer to layoffs.fyi for more information. This layoff tracker is a crowdsourced database of the current downsizing happening in the technology sector.
Tech layoffs – The future
The tech sector collapse is set to run deep and might continue throughout the year or even more, resulting in many more job cuts. The recent layoffs might just be the first round. All in all, it’s a rough road ahead for tech sector employees, whether they are working for Google or Microsoft.
