The word “Layoff” in itself is very intimidating for everyone. To witness someone, lose their job, it’s heartbreaking. We are aware of many folks who have lost their jobs. The situation is even dire in America or other Western economies, where companies are firing at a much higher rate than in India. What is causing this Big Tech downturn? Let’s try to decode this.
It’s that awful hour when the Leading multinational corporations, including Apple, Google, Twitter, and Amazon, have all declared hiring freezes and/or large-scale layoffs. Fears of an impending recession are hurting international tech companies the most.
Despite avoiding the widespread layoffs experienced in the West, the Indian IT sector saw a decline in hiring as a result of squeezed margins and declining demand. Companies have reportedly frozen or reduced employee bonuses due to concerns over the US and European IT budgets’ declining levels. For instance, it has been reported that the variable pay element of employee compensation for the current fiscal has decreased at both Infosys and Wipro.
Let’s understand it on a case-to-case basis:
Amazon: 10000 Jobs At Stake
According to an article in The New York Times last Monday, Amazon plans to let go of around 10,000 technical and corporate positions, largely in the retail, device, and human resources division. This would be the largest firing in the 28-year history of the world’s largest e-commerce company, founded by Jeff Bezos, and would make the e-commerce juggernaut the most recent tech titan to undertake a massive redundancy plan.
According to the Times, the number is still erratic because several teams are carrying out the cuts. As per global media reports, Amazon also started terminating several contractual workers who served in recruiting capacities for its advertising, internal operations, and other departments recently.
Andy Jassy, who took over as CEO in July 2021, has been slashing costs to conserve cash as the company faces sluggish sales and a bleak global economy.
The alleged layoffs would affect 1% of Amazon’s global employees and 3% of its corporate staff.
Several sacked employees have taken to LinkedIn to share their narratives and look for jobs which also includes several H1-B visa holders.
Meta: 11,000 Layoffs
The market capitalization of Meta was wiped entirely in the fourth quarter, and the stock fell to its lowest level since 2016.
Since the beginning of this year, the company’s Reality Labs division has lost $9.4 billion as a result of CEO Mark Zuckerberg’s dedication and passion for the metaverse.
After increasing its headcount by roughly 60% during the pandemic, now Meta is rightsizing. Facebook’s parent company, Meta, announced last week that it would cut 11,000 jobs or around 13 percent of its staff.
Competition from rivals like TikTok, a general slowdown in online ad spending, and difficulties with Apple’s iOS updates have all harmed the company’s performance. In a message to staff members, Zuckerberg stated that individuals who lose their employment will be paid for 16 weeks in addition to two more weeks for each year of service. For six months, Meta will also pay for health insurance.
Twitter: 3,700 Layoffs
According to internal messages seen by CNBC, Elon Musk, the new Chief let go of about 3,700 Twitter employees shortly after finalizing his $44 billion acquisition of the company late last month. That is around half the workforce. Musk stated in a statement on November 4 that he had “no choice” but to fire the staff members, adding that they had been given a three-month severance package.
According to Musk, the layoffs come as Twitter is losing more than $4 million daily. Revenue decreased 1% from a year earlier in the second quarter, the most recent time Twitter disclosed earnings.
Microsoft: Approximately 1,000 Job Losses
Microsoft said in October that it has fired around 1% of its workforce. According to an unnamed source mentioned in an Axios report, the cuts affected around 1,000 workers.
For the quarter ending on September 30, Microsoft had previously predicted the weakest revenue growth in more than five years.
Wall Street Firms Slash Jobs
Along with the biggest names in technology, major Wall Street firms like Citigroup, and Goldman Sachs, have also made job cuts. Morgan Stanley also plans to do the same in the near future.
Tencent Starts Terminating
According to reports coming out of China, the tech giant Tencent has begun terminating workers from its cloud, gaming, and video streaming businesses.
According to Tencent management, they have closed non-core companies in a few sectors, including online education, e-commerce, and game live-streaming, as part of their cost-cutting efforts.
Along with competitors Alibaba Group and smaller Chinese IT firms like Xiaohongshu, Tencent already reduced employment earlier this year.
China’s tech industry is still suffering from a regulatory crackdown and challenges brought on by the zero-COVID policies that have slowed the country’s overall economy.
Layoffs In South Asian Companies
Many of the Tech giants’ regional offices are located in Singapore, a significant tech hub, where hiring is frozen or downsizing is occurring.
Two waves of layoffs and job retrenchment were announced by the Singapore-based gaming and e-commerce behemoth Sea Limited (the parent company of Garena and Shopee) in June and September.
StashAway, a digital wealth manager based in Singapore, let go 14% of its staff, while currency exchange Crypto.com fired 5% of its Singapore employees.
iPrice, a Malaysian online shopping platform, also laid off 25% of its workforce, and more than 200 employees were let go by the Indonesian education tech firm Zenius.
Warner Bros. Discovery, Seagate Technology Holdings Plc, Arrival SA, Coinbase Global, and Walt Disney Co. are a few other American businesses to name that have let go of staff.
What we are witnessing today is downsizing or to say rightsizing?
Be with us and go through our next article to have incisive insight into downsizing in tech behemoth and its impact on firms, millions of families, and the government.
