HS050 The Tech Job Debacle

Google, Microsoft, Twitter, META/FB and a few others laid off an estimated 200,000 tech and tech-adjacent folks in recent weeks. Other companies like Fedex and Amazon have made layoffs, many impacting the IT teams. What does that mean for the tech industry? Between AI and our corporate overlords are we all lucky to be employed, and should we go back to working 80 hour in-office weeks? It’s worth noting that the companies have hundreds of millions in cash and record profits—why do they feel the need to lay off tech and tech-adjacent workers. What’s going on here? And what should IT folks do about it? (Johna will happily steal her client’s observation that all the big muckety-mucks got together in Davos and a week later came the layoffs… do we think that’s a coincidence?)   Shareholder don’t want risk, but shifting business risk onto employees might not be sustainable. Employers are complaining that people “don’t want to work” which I take as “they are no longer over-working or committed to the vision so some such”. Workers have little incentive to do so when they can lose their jobs through no fault of their own While employees may become shareholders, they lose share vesting rights when laid off. Generally, tech layoffs come with generous severance – it roughly costs about $1B per 10000 workers laid off. The layoffs have continued this week into second tier companies and its beginning to feel like performative media: “I have to do layoffs because everyone else is” One angle that several analysts are highlighting is that CEOs and executive have made huge mistakes in over-hiring and are happily admitting that its their fault But the CEO’s and executives are taking any pain, nor are the shareholders. Their brands or careers aren’t damaged, they all tell each other its good experience and valuable learning It should be noted that only the tech sector is taking layoffs. In general, there are few layoffs in the wider economy, which is sometimes used as a deflection by tech CEOs. This week Yahoo cutting 20% of staff, Gitlab 10% and cutting office space   Link: An announcement from GitLab CEO Sid Sijbrandij | GitLab – https://about.gitlab.com/blog/2023/02/09/gitlab-news/ Link: Exclusive: Yahoo to lay off more than 20% of staff as it shrinks ad biz – https://www.axios.com/2023/02/09/yahoo-layoffs-2023-tech-media-companies Link: GoDaddy Inc. – A message from GoDaddy CEO Aman Bhutani – https://aboutus.godaddy.net/newsroom/press-releases/press-release-details/2023/A-message-from-GoDaddy-CEO-Aman-Bhutani/default.aspx Link: Tech’s Elite Hates Labor – Ed Zitron’s Where’s Your Ed At – https://ez.substack.com/p/techs-elite-hates-labor Link: Blame the CEO for Tech Layoffs at Google, Facebook, Salesforce, Amazon – https://www.businessinsider.com/fire-blame-ceo-tech-employee-layoffs-google-facebook-salesforce-amazon-2023-2?r=US&IR=T Link: Zoom is the latest tech firm to announce layoffs, and its CEO will take a 98% pay cut – NPR https://www.npr.org/2023/02/08/1155392099/zoom-layoffs-tech-jobs Eeek eek the sky is falling https://www.grid.news/story/economy/2023/03/21/tech-layoffs-in-2023-are-about-to-surpass-last-years-record-n...