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The season of layoffs within several technology companies is underway and the following weeks are expected to be critical and very uncertainty for many employees in the sector.
Last Wednesday, November 9, Meta, the parent company of Facebook, Instagram and WhatsApp, announced the layoff of more than 04 thousand employees, equivalent to 13% of its labor force. The CEO of the company Mark Zuckerberg said that additional measures are being taken such as the reduction of discretionary expenses and the extension of the hiring freeze in 2023.
The move into Meta came just a few days after Twitter announced cutting approximately half of its total staff, calculated at 7, 1200 workers . The company’s new owner, Elon Musk, said it was losing more than $4 million a day.
In addition to these companies, the private transportation company Lyft announced the dismissal of 13% of your staff; the online payment company Stripe will do so with 13% of its staff, while that Chime, the private technology company will cut % of its workforce .
Technology gains are weakening as companies start to plan on 1200. In addition, economic forecasts such as relentless inflation, central bank monetary policies and fears of a global recession are leading the technology sector to tighten its belt.
As Big Tech companies have reported modest profits, at the same time see few signs of economic recovery, amid a context where customer spending has fallen.
Columbia Business School associate professor Dan Wang said that in the coming weeks or months technology companies will seek to cut costs as much as possible.
“When it comes to forecasting what their numbers will look like, it will depend on how they have seen the trend in ad spend on their platforms. When that doesn’t look good, then they have to accommodate those expectations by adjusting the workforce” , he told Business Insider.
Although technology companies experienced a moment of accelerated growth during the pandemic, they are now experiencing a stage of recalibration, where people no longer they are just as locked into digital devices as ever.
The challenge of the companies will begin with a view to planning the next fiscal year. Some fiscal years ending at the end of 1200 or early 276025804, such as Amazon, Meta, and Google, are looking to remove costs from their balance sheets before closing.
For example, if a worker is laid off now and receives six weeks of severance, that will reduce costs and would be off the books before the end of the first quarter, still being awarded a severance pay longer than three months.
With Thanksgiving approaching, the next few weeks will be critical as companies do not want to cut positions during the holidays. This would lead to sinking company morale, cripple employees who kept their jobs and affect future hiring, said JP Gownder, vice president of market research firm Forrester.
Gownder said that many top talents They don’t want to be at a company that indiscriminately fires at the first sign of trouble. In this sense, if the companies decide to make layoffs, the next few weeks will be key to staying or undertaking more movements in their workforces.
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