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Tens Of Thousands Losing Jobs Every Other Month In 2023

The end of 2022 kicked off the beginning of some tough times for employees in the tech industry. Unfortunately, the tough times are going deep into 2023.

It’s the end of March, and last year’s reckoning continues to make what were previously some of the most secure companies (at least as far as jobs are concerned) very volatile. According to TechCrunch, tens of thousands of workers have already been laid off from their jobs in 2023.

While the bulk of these layoffs is driven by big tech giants such as Google, Amazon, Zoom, Microsoft, etc., the startup world has taken a significant hit in all sectors, from crypto to SaaS enterprises. As per TechCrunch statistics, 84,714 employees were laid off in January, while 36,491 were let go in February.

March has only piled on to these already irrational numbers. For example, on March 28th, Lucid announced they would release 1,300 employees (18% of the workforce). Previously, Microsoft had announced plans to let go of 10,000 people while Amazon is laying off 9,000 employees. Other companies that have let go significant portions of their workforce include; Virgin Orbit (85%), Roku (6%), Unacademy (12%), GitHub (10%), Disney (7,000 employees), and Accenture (19,000 jobs) among many others.

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So, what’s the reason behind these layoffs, and why are they still going on? Due to record revenues during the covid-19 pandemic, the tech industry undertook a hiring spree. However, these layoffs can be associated with the ‘end’ of the pandemic. So, maybe these tech companies expanded way too fast?

Forbes suggests that the median level of work experience for those laid off is 11.5 years, while that of those hired during the pandemic is roughly 2.5 years. One possible way this explains the layoffs is that more experienced employees have higher salaries; therefore, laying them off helps these tech companies meet their financial targets.

Another reason put forward by Forbes for these layoffs is the role and job function of those laid off. As per their study, HR departments account for 28% of all releases. This makes sense because layoffs imply less recruitment, suggesting less HR staff is needed. Another explanation is that HR departments are increasingly becoming redundant due to new automation technology. For example, Amazon is a company that has reportedly used AI to rank employee performance. This information is then used to fire those deemed as ‘low-performing.’