Pace of Layoffs Picks Up Speed In Tech Sector

"Technology-driven companies across industries have been laying off workers at the fastest pace since the Covid-19 pandemic shocked the global economy in 2020, according to one data tracker.

Collectively, employers in the slumping tech sector cut more than 150,000 jobs in 2022, based on estimates from Layoffs.fyi, a website that tracks the events as they surface in media reports and company releases.

That figure compares with about 80,000 layoffs in March-December 2020 and 15,000 in all of 2021, based on data compiled on the site.

The tally was created by San Francisco internet entrepreneur Roger Lee, who launched the tracker after the pandemic struck "as a side project to create awareness around all of these tech layoffs, in the hopes of helping laid-off employees find a home."

The estimates include large employers such as Facebook parent Meta Platforms Inc. (more than 11,000 layoffs announced in November) and Amazon.com Inc. (about 10,000 possible job cuts), as well as smaller businesses in the U.S. and abroad.

The figures are rough estimates and don't capture all layoffs but reflect a trend that is playing out in many of the largest tech companies.

For years, many tech companies aggressively added workers amid strong revenue growth and rising share prices.

The hiring pace picked up during the pandemic as individuals and companies leaned on technology to help get through lockdowns and other Covid-related disruptions.

Now, the same businesses are laying off employees, implementing hiring freezes and cutting costs, as spending on tech products slows and the outlook for digital advertising dims.

Some chief executives have apologized for expanding their payrolls too fast.

The pullback in tech hiring has happened when the broader labor market has showed signs of resilience. There are several reasons for the apparent disconnect between news of tech firms cutting workers and the monthly government reports showing overall U.S. payrolls maintaining steady growth -- one of which is that many laid-off tech workers are finding new jobs quickly.

About 79% of workers recently hired after a tech-company layoff or termination landed their new job within three months of starting their search, according to a ZipRecruiter survey of new hires." [1]

 

In this case, about 30,000 of them could be unemployed in 2022.

 

1. Pace of Layoffs Picks Up Speed In Tech Sector
Barnett, Andrew; Li, Ming.  Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 04 Jan 2023: B.1.