Massive layoffs in big tech companies such as Twitter, Meta, Amazon, Google, Microsoft and Spotify continue.
As fears of an upcoming recession and production costs rise and the race to AI speeds up, the companies have described the layoffs as an inevitable trajectory.
Twitter was one of the first among the big tech companies to take a bite and make headlines. Shortly after Elon Musk’s takeover last November, the total company headcount was slashed by half, from 7,500 workers to roughly 3,800.
According to Musk, it was a necessary decision to make as advertisers reevaluate spending. On top of that, the company had already been going through “revenue challenges” before the new CEO had even stepped in, dropping 35% in revenue (or $1.025 billion) in its third quarter.
This move sparked outrage among the company’s employees, some of which had lost access to their Slack accounts before knowing they had been laid off, and a hundred others voluntarily resigned.
Meta, Microsoft, Amazon Bid Goodbye to More Than 30000 Employees
Last week, the company underwent a second round of layoffs, affecting 50 workers from the site production division.
Meta followed shortly after Twitter, cutting 13% or 11,000 members of its workforce last November, marking the biggest layoff in 2022 and company history.
As investors express their hesitation in the metaverse offerings, the tech giant experienced a disappointing 70% share price decline last year, with a 19% rise in expenses and a 4% drop in revenue in its third quarter, according to data.
In a statement, Meta CEO Mark Zuckerberg shared his plans to focus more on a “small number of high-priority growth areas,” meaning some teams will grow while others will sustain or reduce their headcount for the following year.
“In aggregate, we expect to end 2023 as either roughly the same size or even a slightly smaller organization than we are today,” he said.
Microsoft and Amazon followed earlier this month, with an estimated 10,000 and 18,000 employees laid off, respectively.
Microsoft CEO Satya Nadella explained that the company could not be exempt from a weakening global economy. “As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” he explained in a company memo.
Meanwhile, Amazon Chief Executive Andy Jassy shared that the company was experiencing difficulty with annual planning given the uncertain economy and the company’s rapid hiring in previous years.
Amazon had previously cut 10,000 jobs last November, but the number has nearly tripled. The company’s stock fell more than 1% early this January, becoming half the price it was in 2022.
Google Carries Out the Biggest Layoff
More recently, Google announced the layoff of 12,000 or approximately 6% of its employees. Google CEO Sundar Pichai said the company is banking on AI technology moving forward; to do this, it must take cost-cutting measures.
“I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI. To fully capture it, we’ll need to make tough choices," he mentioned.
The latest entry into the layoff season comes from Spotify, but the company has yet to reveal how many jobs it plans to cut.
Overall, an estimated 56,000 employees have been laid off by 174 companies so far in 2023. This is more than a third of the estimated 158,000 employees fired by 1035 companies in 2022.
And as the trend continues, these numbers are only expected to grow in the coming months.