“I absolutely loved what I did,” Chavez, who is based in Phoenix, said in a text message. “But I was fed up with being fired.'' He is currently pursuing a graduate degree in psychology.
Mr. Chavez announced that hundreds of thousands of technology workers have been laid off over the past two years in what appears to be a never-ending wave of cuts that upend the culture of Silicon Valley and the expectations of those who work at some companies. There is only one person. One of America's richest and most powerful corporations.
Technology companies laid off more than 260,000 employees last year, according to layoffs tracker Layoffs.fyi, with executives citing “overhiring” and high interest rates during the pandemic, making it difficult to invest in new businesses. This is said to be the reason for the reduction in personnel. But even with stable interest rates and a booming job market in other industries, these layoffs have dragged on into 2024, leaving the tech industry's workforce discouraged and confused.
The U.S. economy added 353,000 jobs in January, about twice as much as economists expected. Still, Google, Amazon, Microsoft, Discord, Salesforce, and eBay all made significant layoffs in January, and the layoffs seem to be slowing down. PayPal announced in a letter to his employees on Tuesday that it would cut an additional 2,500 jobs, or about 9% of its workforce.
The continued cuts come as companies come under pressure from investors to improve profits. Tech stocks slump on Wall Street in 2022, forcing companies to win back investors By focusing on increasing profits and laying off some of the tens of thousands of workers hired to respond to the boom in consumer technology spending due to the pandemic. With many technology companies laying off employees, layoffs are no longer a sign of weakness. Now, executives are looking for more places to squeeze more work out of fewer people.
“We will continue to be cautious about what we invest in and continue to invest in new things, new areas and things that resonate with our customers. If we can accomplish that, we're going to do it,” Amazon Chief Financial Officer Brian Olsabsky said in response to a reporter's question during Thursday's media earnings call.
“This is how the U.S. capitalist system works,” said Mark Zandi, chief economist at Moody's Analytics. “It's ruthless when it comes to pursuing profitability and creating wealth. It redirects resources from one place to another very quickly.”
Gil Luria, a technology analyst at DA Davidson, said economic concerns and inflation in 2022 and 2023 will also reduce the amount of software and cloud services that businesses buy.
“It ripples through the software ecosystem, and as we look to 2024, the latest data points show that while things are no longer getting worse, they still don’t seem to be getting better,” Luria said. “Their customers are not loosening their wallet strings.”
Unable to recapture the phenomenal revenue growth of the past few years, tech company executives have instead opted to change things positively for Wall Street by continually cutting well-paid workers. are doing.
It seems to be working fine. In 2022, the Nasdaq Composite Index, a stock index dominated by tech companies, lost a full third of its value. In 2023, it increased by 43%. It rose another 3% in January.
The shine has disappeared from the technology industry.
Even as stock prices rise, the mood in the San Francisco Bay Area, the heart of the U.S. technology industry, only worsens. The power that high-tech workers felt commanded to change jobs and earn higher pay and better stock awards has partially evaporated.
For many tech workers, the luster has faded from the industry in which they traded their lives for the chance of job security, flashy perks and big stock options. Google and Meta have cut back on employee perks in recent years, including free laundry, free massages, and food and fitness offers. “Technology seems to have completely changed since the mass layoffs,” an anonymous worker posted on workplace gossip app Blind this week.
“Feeling job insecurity is very new,” says Julia Grummell, a former senior product designer at a Bay Area software company. Since she was fired in February 2023, Grummell has received rejections from automated systems, been ghosted by employers after several interviews, and been rejected without any feedback, she said. said. And she faces competition from vast numbers of workers who, like her, have been laid off.
Grummell said she has received interest from some companies that have already cut staff, but she is wary of those companies. “I'm not really interested in joining an organization that clearly doesn't care about the people who keep the business running.”
Like Chavez, she said she is starting to think about looking for other types of work, focusing less on pay and more on jobs that offer a better work-life balance and more meaning and fulfillment. Ta.
Even workers with years of experience and deep technical expertise struggle to be rehired.
Parker Lopez, a Seattle machine learning engineer and data scientist, was laid off at a health tech startup in May 2023. The last time he was on the job market was a few years ago, and it took him just three months to find one. work. But this time, he applied for over 1,000 roles without getting any results.
“It feels very wasteful,” he said.
Jennifer Pearl, a contractor who was fired from Amazon, said she had a hard time passing interviews despite having years of experience in software engineering, data science, and manufacturing, including at Microsoft. Pearl previously said he was able to find a job within a few days.
“We’re worried,” they said. “I've been doing this job for 20 years…and now I'm lucky to get a call again.”
Some of the recent layoffs have targeted middle managers who led teams hit by previous waves of layoffs. Some of them are looking to get back to writing code rather than directing other people's work, thinking they might be safer in that role. Workers who used to move from company to company every three to four years to maximize the amount of stock options they could accumulate are now staying put.
Tech workers have also been subjected to a year of nonstop debate about the artificial intelligence boom and its potential impact on the workforce. Many programmers are using AI tools to write code faster, and executives and technology experts often talk about how much more efficient their workforce will be in the near future.
AI executives argue that more productive workers mean more profits for companies, leading to more growth and more jobs.
But tech workers themselves aren't so sure. Neither of them are economists.
“The high-tech sector may be able to produce more and innovate without having as much talent in the future,” Moody's economist Zandi said. “That's a lesson in AI.”
Tech jobs, once glamorous, well-paying and coveted, have become less secure and less attractive to many people in recent years. As a result, workers are taking lower-paying jobs, moving laterally, or seeking alternative job opportunities.
The job search has been tough since being laid off last April, said a former Meta user experience researcher in the Bay Area who spoke on condition of anonymity to avoid damaging his future employment prospects. . She originally worked in academia, but joined industry to expand her knowledge and ensure job security, good benefits, and a higher salary.
“It was a perception of stability,” she said of joining the tech industry. “And yet here we are.”
