Nearly 25,000 tech workers were laid off in the first weeks of 2024. Why is that?::undefined
As others stated a small portion of that was due to over-hiring, some to follow the layoff trend and some to make the earnings call look good.
But from what some experts are saying; there’s also another factor, which is even worse.
There’s a looming threat of a recession hitting in a few months (which is said to be a much bigger recession than the post-Covid one). And this recession will be tied to the Commercial Real-Estate Bubble.
They are saying that it will be like the 2009 Mortgage Crisis and will be very disruptive.
There’s this theory that companies are reducing their headcount to prepare for this recession by reducing their expenses to the minimum. Which makes sense.
For the companies without savings that is a must but the ugly part is that you see big names with huge amounts of money in the bank laying off people as well.
Well, because they don’t want to invest that money on the people, they will use all that money to buy smaller companies when the recession hits. All big tech with enough money in the bank is rooting for the recession to happen so they can buy everything for very cheap and grow even more.
I think another thing that isn’t being talked about with these layoffs, which would call for more unionization and policy making, is that “AI” is taking over these jobs.
Also when companies merge, there are “redundant” employees. So like the recent Microsoft layoffs, those were going to happen.
There was massive over hiring near the end of covid. So now they are shedding again.
Everyone is cutting headcount, so everyone else is following along. Thinking this must be good we stay competitive.
It’s a pretty US focused issue though, as in European countries you can’t just fire someone like that. There’s definitely more cautious hiring though.
There hasn’t been the same purge here in Europe. I think the US tech industry is very large, and covid saw demand surge, resulting in a lot of hiring. Demand slumped which led to this. We’re not seeing the same purge in other industries. Headcount just needs to normalise again, which I think won’t take much longer. Unfortunately there is a compounding factor: interest rates. Tech was propped up by free money. Without that, we might see larger structural issues in the industry. If companies start failing then we enter a new phase in the layoffs.
Yeah very large at more at will employment so you can just Hoover up anyone and then see if you needed then later…
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.”
ughh this makes my blood boil
yeah workers are “OK” with it, yeah, no, they’re too fucking terrified they’re next to do anything about it
hate this guy
More like the workers aren’t unionized and have no voice in the matter, amirite?
Unions can’t stop layoffs - at best they can just change the order in which employees are laid off (First-in Last-out / seniority), I guess the process might make the company reconsider, but there’s no direct intervention.
I’m a member of a union and went through layoffs.
I think it’d only change if unions had power on the board / guaranteed share ownership, etc. as is the case in Germany (board representation with workers’ councils) and was proposed but rejected in Sweden (share ownership).
