The tech industry’s moment of reckoning: layoffs and hiring freezes
Companies have been cutting costs. | Photo by Natt Garun / The VergeOver the past few months, the economy has started to turn, and tech workers are being hit hard. Meta, Twitter, and more have fired thousands, and others...
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It feels like every day, we hear news of mass layoffs and hiring freezes from big tech companies that were formerly famous for having deep pockets and near-endless amenities for workers. Now, it’s clear that the industry as a whole is tightening its belt, leaving hundreds of thousands of employees out of work — and more wondering if they’ll have a job within the next few months or searching for jobs in an industry that no longer has a spot for them. It’s gotten to the point where one tech recruiting site created an interactive tool to track the layoffs across established companies and startups.
It’s impossible to blame the wave of large-scale layoffs on any one factor. Twitter’s layoffs happened because Elon Musk bought the company and took it private, and Meta’s CEO claims its 13 percent reduction in staff is a course correction after the company went on a hiring spree during the online retail boom that came out of the pandemic. Companies that rely on advertising, like Meta and Snap, have also been hit hard by privacy policy changes from Apple.
Meanwhile, the iPhone maker is blaming the economy for its own hiring slowdown, despite being one of the few companies still announcing record-breaking earnings and beating estimates.
To open 2023, Amazon announced its layoffs of mostly corporate employees will trim 18,000 workers from the roster, the biggest reduction — in raw numbers, despite Amazon’s 1.5 million-strong workforce — yet.
We’ll probably see even more reasons for layoffs or freezes as other companies announce their own. Stay tuned to this page for the latest on big tech companies’ cost-cutting measures and how they affect current and former employees.
Here’s all our coverage of the recent outbreak of layoffs from big tech, auto, crypto, and more:
1,852 Amazon workers are out of a job in Seattle.
The company is in the process of laying off 18,000 people, and carried out a round of cuts today. Washington’s publicly-accessible WARN system lets us know how many people in Amazon’s home state were affected: 1,852 in Seattle, and 448 across the lake in Bellevue, for a total of 2,300.
Screenshot: Sean Hollister / The Verge
DirecTV is reportedly laying off hundreds of workers.
“Most” of the people affected will be managers, according to Deadline, though apparently the company classifies around half of its employees with that title. In a statement to Deadline, DirecTV said it was “adjusting [its] operations costs” because less people are paying for TV and shows are getting more expensive to secure and distribute.
Amazon confirms it’s laying off 18,000 workers.
Following a report from The Wall Street Journal, Amazon CEO Andy Jassy is notifying employees that the company’s ongoing layoffs will affect 18,000 workers.
It’s the first time we’ve gotten a concrete number from Amazon since The New York Times reported in November that the company planned on cutting 10,000 jobs.
Apple’s market cap is down $1 trillion from its peak exactly one year ago.
On January 3rd, 2022, the value of Apple’s shares briefly crossed $3 trillion.
Today, on January 3rd, 2023, the value of $AAPL shares fell to 125.07 at the market’s close, a 52-week low that sets its market cap at a frankly piddling $1.99 trillion. Now analysts are predicting a slight decline in revenue when Apple releases its latest quarterly earnings report in a few weeks.
The share price is down amid greater economic and interest rate concerns (see, it’s not just Tesla and crypto taking a beating), as well as gloomy news about both iPhone production and demand.
Micron will cut 10 percent of its workforce next year.
The chipmaker announced the plan as part of its earnings report on Wednesday, saying the reduction would come from “a combination of voluntary attrition” and layoffs throughout 2023. The company also won’t be doing bonuses next year and says that executive salaries will be cut too.
Micron recently reported it has 48,000 employees, according to CNBC, meaning around 4,800 positions could be affected.
Like Intel, which has planned its own layoffs, Micron is investing billions in building new US fabs.
Some ex-Meta employees say they’re not getting full severance.
A group of former Meta employees say they’re only receiving eight weeks of base pay and three months of COBRA as severance — half of what CEO Mark Zuckerberg promised when the mass-layoffs were announced, according to CNBC.
The full-time, non-contract workers, who were in a Meta apprenticeship program, say the company hasn’t responded to their questions with an answer on whether the discrepancy is intentional.
GameStop is reportedly cutting more jobs.
Axios reports GameStop has begun another round of layoffs. The scale of the layoff is unclear, but Axios says the blockchain team was “heavily impacted.” In an email to employees obtained by Kotaku, CEO Matt Furlong said the decision to lay off staff was due in part to high inflation and “weakened consumer confidence.”
The company, which gained a lot of notoriety as a meme stock, laid off staff and fired its CFO in July.
Job cuts are coming to a Silicon Valley original.
HP, one of the world’s largest PC vendors, according to data from Gartner, announced in an earnings report that it’ll lay off 4,000 to 6,000 employees by the end of 2025. According to numbers cited by CNBC, that’s between seven and 11 percent of its workforce.
This is just the latest in a series of large tech layoffs, not to mention that the PC market has also had an especially rough year following a pandemic boom.
Alexa isn’t pulling its weight.
Internal documents obtained by Insider indicate that Amazon’s Alexa division made up the “vast majority” of the over $3 billion that the company lost across its “Worldwide Digital” department, which includes Alexa, Echo devices, Prime Video, and other products.
Amazon confirmed layoffs affecting thousands of employees on its hardware and services teams last week, and the company’s CEO says to expect even more job cuts next year.
Amazon employees are still waiting to hear if they’ll keep their jobs.
Were you expecting Amazon to simply announce its expected 10,000 layoffs? Recode writes that the company’s swinging the ax quietly instead — quietly enough that many don’t know what’s going on. Meanwhile, “large swaths of the company’s HR division” are receiving voluntary buyout offers.
More at Recode:
