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Tech layoffs: Over 2,700 people lost their jobs per day so far in 2023. When will layoff winter end?
- According to Trueup.io data, which tracks tech layoffs, so far in 2023, there have been 534 layoffs at tech companies with 153,005 people impacted (2,732 people per day).
The start of 2023 has turned jittery for job seekers. There is a scarcity of new jobs as existing employees by tens of thousands are let go by many companies, especially by tech biggies, unicorns, and startups. So far in 2023, more than 2,700 people have lost their jobs on a daily basis. As of now, cumulatively, over 1.53 lakh people are impacted as per data. And those who have a job thankfully still under their kitty are facing either salary cuts or no hikes. Meanwhile, many are hired but are still struggling due to onboarding delays. The biggest spoilsport for this layoff winter could be macroeconomic risks and recession fears.
It's hard to find a job these days. The industry growth struggles with constraints from high inflation, geopolitical tension, rate hike cycle, multi-year low unemployment rate, the cold war between US and Russia and so much more. The major economies are feared to be at the edge of recession.
Tens of thousands of people have been laid off by tech giants such as Meta, Google, Amazon, and Microsoft in recent times. Meta last year shocked by carrying a massive 11,000 job cut, while Google trimmed its workforce by 6% to 12,000 layoffs, on the other hand, Microsoft let go of 10,000 employees. And to top all of them, e-commerce giant Amazon laid off massive 18,000 employees. Tesla's CEO Elon Musk who took charge of Twitter last year also fired a significant amount of people on the social media platform. Dell Technologies as well carried mass job cuts to the tune of 6,650 employees.
More layoffs are in the offing. Lately, the parent of Facebook is said to be looking for another 11,000 job cut, while telecom giant Ericsson announced a plan to trim 8,500 jobs. Consulting firm McKinsey too is on a similar boat and is planning to let go of 2,000 employees.
If that is not enough to send uneasiness among job seekers, then reports have said Amazon may trim the salary of employees by 50% in 2023. Whereas, Google now seems to be asking employees to share desks while working. On the other side, many employees are still awaiting their onboarding after months of being hired by various companies.
According to Trueup.io data, which tracks tech layoffs, so far in 2023, there have been 534 layoffs at tech companies with 153,005 people impacted (2,732 people per day).
The data showed that last year, there were 1,535 layoffs at tech companies with around 241,176 people impacted.
Ujjal De, Founder and CEO of KarmaV which enables organizations of any scale to build their employer brand, and simplify & streamline the recruitment process, said, "uncertainty will loom over the job market in the first half of 2023 as various sectors will witness uneven signs of recovery and impose a cautionary approach towards an impending recession."
But these are not the only reasons for layoffs. IT companies are witnessing normalization in demands post-pandemic but their valuations are squeezing. Further, startups are pushed to look for conservative hiring strategies while concentrating on improving their bottom lines.
KarmaV founder pointed out that post-pandemic, the inflated IT businesses are making massive layoffs as the demands are normalizing and valuations are shrinking.
"A reduced risk appetite of the investors is drying up aggressive funding and pushing startups and SMBs to focus on their bottom line and resort to a more conservative hiring strategy," he added.
Another key reason could be the adoption of artificial intelligence such as chatbots which are gaining popularity as they are likely to drive productivity, lessen human work and allow to take on more challenging tasks, and are likely to be flexible and efficient.
So when will the layoff winter end? It is probably expected to end in the second half of 2023.
KarmaV's founder believes that rapid digitalization will drive a surge in demand, and market recovery is expected in the second half of 2023, especially for talents with experience in the BFSI sector.
He added, "Infrastructural developments like 5G will accelerate smart city initiatives and transform manufacturing, transport, healthcare, and retail sectors. The homegrown startup ecosystem and R&D hubs will gain fresh momentum, and demands will swell for tech talents with edge computing AR/VR, data analytics, and AI expertise."
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Business NewsCompaniesNewsTech layoffs: Over 2,700 people lost their jobs per day so far in 2023. When will layoff winter end?
First Published:25 Feb 2023, 10:01 PM IST
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