If you’ve been following recent business news for the past few months, then you’ve probably noticed that there’s been a huge increase in the rate at which Big Tech Companies are firing people. If not though, allow us to give you a glimpse of what the situation is looking like (at the time of writing this article).
Over the past few months, Twitter (which was recently acquired by Elon Musk) has fired 3700 people. Uber laid off the same number of personnel as well. The blow was a bit softer at Microsoft who offloaded around 1000 employees. The biggest lay off figure by a landslide though would have to be “Meta” who let 11,000 employees go (that’s 11% of their total work force by the way).
The notable missing big names from this lay off spree (so far) are Apple and Google and while they have yet to mass fire personnel, there is no guarantee for that to remain the case and they are also currently under a major hiring freeze.
The above information is strictly associated with just the publicly disclosed numbers and so, the actual figures are even higher.
So let us further examine the situation and try to understand two of the reasons it has reached this point.
The Current Global Economic Situation
The repercussions resulting from the COVID-19 Pandemic and the ongoing war in Europe are perhaps the two most influential factors that have resulted in the current global economic situation.
Almost all business around the world have been negatively impacted by that due to lack of raw material necessary for manufacturing, liquidity/cash flow problems among many others. As a result, there’s just less appetite to spend money both on the business as well as the individual level.
On one hand, investors are not as eager to invest big on businesses as much as they used and that of course causes all sorts of problems to said business (mainly less capital) and that negative effect inevitably eventually impacts the employee. Once the impact reaches the employee (in the form of lay-offs or cost cutting measures of any sort) -but now think of them as consumers rather than employees- they have less disposable income from which to spend. Less spending directly equates to even further damage to the business. A vicious cycle.
Inaccurate Post COV-19 Predictions
The Pandemic changed the way we live, its just a fact. The change though was understandably at its absolute peak during the first few months or year of the pandemic.
We drastically changed the way we work, almost all jobs changed to accommodate a remote nature. In person meetings no longer existed and were replaced by online video calls. In person communication took a drastic hit and social media was the main channel of human communications. People stopped going to restaurants, but online food ordering was at an all time high. Similarly, people stopped going to stores but online shopping flourished. Cinemas completely disappeared but everyone was binge-watching Netflix, Amazon prime and their likes. We can go on forever.
Big Tech Companies predicted that such behaviors would -to a large extent- continue even post-Covid and so, they made their planning accordingly in order to be able to accommodate the demand of their platforms and services. To some extent they were right, quite a few of the behaviors we adopted during the pandemic remain with us till today but apparently, not as much as Tech Companies had expected.
Basically, Big Tech companies over-hired and over invested for expected size of business that simply does not exist.
The above is a summary of this particular factor, you can find more details at the information source here (35) Twitter, Meta, Amazon: Why is Everyone Getting Fired? – YouTube
At this point, any information regarding the future is pure speculation. The world is just too unpredictable for forming a clear picture of what’s to come next. If the past 2 years have taught us anything, it’s that. We’ve encountered a pandemic and a war, both of which seemed to just explode onto the scene overnight.
What we do factually know though is that the world is currently in possession of a rich pool of very smart unemployed people who have had solid contributions to the growth of the biggest Tech Companies we know today. They are an amazing opportunity for upcoming business who are looking for proven talents to help them build a name for their selves in this competitive market.
Crises usually come hand in hand with innovation and emerging Tech companies will think of creative ideas to grow and thrive in this tough environment. They also luckily just happen to have a very rich pool of talented job seekers waiting for them.
The firing and layoff sprees are unfortunately expected to continue as economic conditions continue to worsen and Big Tech companies continue to deal with the repercussions of their inaccurate business forecasting.
The silver lining though as that while giants fall, others begin to rise and those should be the target of employees who were let go by their employers.
Keywords: Big Tech, Meta, Twitter, Lay-offs, Covid-19, Global Economy. Mass firing