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Last year was, by all accounts, a bloodbath for the tech industry, with more than 260,000 jobs vanishing — the worst 12 months for Silicon Valley since the dot-com crash of the early 2000s.
Now in 2024, tech company workforces have largely returned to pre-pandemic levels, inflation is half of what it was this time last year and consumer confidence is rebounding.
Yet, in the first four weeks of this year, nearly 100 tech companies, including Meta, Amazon, Microsoft, Google, TikTok and Salesforce have collectively let go of about 25,000 employees, according to layoffs.fyi, which tracks the technology sector.
All of the major tech companies conducting another wave of layoffs this year are sitting atop mountains of cash and are wildly profitable, so the job-shedding is far from a matter of necessity or survival.
Some smaller tech startups are running out of cash and facing fundraising struggles with the era of easy money now over, which has prompted workforce reductions.
If it appears as if an entire sector is experiencing a downward shift, Pfeffer argues, it takes the focus off of any single individual company — which provides cover for layoffs that are undertaken to make up for bad decisions that led to investments or strategies not paying off.
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Some smaller tech startups are running out of cash and facing fundraising struggles with the era of easy money now over, which has prompted workforce reductions. But experts say for most large and publicly-traded tech firms, the layoff trend this month is aimed at satisfying investors.
Shulman adds: “They’re getting away with it because everybody is doing it. And they’re getting away with it because now it’s the new normal,” he said. “Workers are more comfortable with it, stock investors are appreciating it, and so I think we’ll see it continue for some time.”
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And as Wall Street rallies on news of laid-off tech employees, more and more tech companies axe workers.
“You’re seeing that these tech companies are almost being rewarded by Wall Street for their cost discipline, and that might be encouraging those companies, and other companies in tech, to cut costs and layoff staff,” said Roger Lee, who runs the industry tracker layoffs.fyi.
So it’s exactly how it feels - it’s pure greed, done by the powerful and unaccountably rich CEOs to woo powerful and unaccountably rich Wall Street investors. All of these tech companies at this point treat their workers as numbers on a balance sheet, just elements of an optimization game where only those oligarchs have a seat.
Not enough profit and also copycat syndrome
Avarice and narcissism?
It’s interesting how often that’s the answer to this kind of question.
Perhaps the economy is not as good as everybody says it is, and a very cyclical sector like tech is the first one to feel it.
Incompetent management
The (non-founder) C-suite seems to think that people hate them for laying off other staff. People hate them because the C-suite doesn’t have to face the consequences of their incompetence. It’s the regular staff that does. CEOs instead get golden parachutes for running companies into the ground.
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Yeah. I worked for a SaaS company that had two rounds of layoffs because they hired C-suite executives who were better at talking than building software or running product teams.
One was let go in the layoffs – but given a book of clients to start a competing business. The other is still there holding pointless meetings that keep people from getting work done.
The mindset in tech for years now has been “growth at all costs”, what we’re seeing is the effects of that cost
