For a stretch of the pandemic, tech companies couldn’t hire fast enough. Talent wars broke out in Silicon Valley, with firms vying for software engineers, often lavishing extravagant perks on their new and would-be hires. As profits soared, executives acted as if the party would never end.
Now, it has — and workers are bearing the brunt of pullbacks. Nearly 200,000 tech employees have been laid off since the start of 2022, according to Layoffs.fyi, a site that tracks job cuts in the sector. Four of the largest tech companies — Alphabet, Amazon, Meta and Microsoft — have announced a total of more than 50,000 job cuts in recent months.
But even after significant cuts, the largest tech companies are still behemoths. They grew enormously during the pandemic, adding tens of thousands of workers. The layoffs announced in recent weeks reverse a fraction of the hiring done in recent years.
In announcing the layoffs to employees, executives struck notably apologetic tones, expressing regrets about overzealous expansion and rapid hiring. The executives pointed to economic factors, made worse by inflation and rising interest rates. But they are also admitting that they over-hired, misreading the durability of the pandemic acceleration in the growth of online services.
*Since the end of 2019, the company has grown by 728,000 people.
“As part of our annual planning process for 2023, leaders across the company have been working with their teams and looking at their work force levels, investments they want to make in the future, and prioritizing what matters most to customers and the long-term health of our businesses. This year’s review has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years.”
— Andy Jassy, chief executive, Jan. 4