Data storage company Seagate said it laid off 3,000 of its employees in an effort to restructure and cut costs. Cut jobs make up 8% of the global workforce, but the company says the current economic downturn needs to cut costs to meet its needs. The company is expected to lay off those impacted by the end of the second fiscal quarter next year and expects up to $70 million in pre-tax payments on severance and other severance pay.

Commenting on the matter, Seagate CEO Dave Mosley said:

“Global economic uncertainty and large client inventory adjustments worsened in the later stages of the September quarter, and these dynamics are reflected in both short-term industry demand and Seagate’s financials. We have taken swift and decisive action to respond to current market conditions and improve long-term profitability, including adjustments to our production volume and annual capital expenditure plans, and the announcement of a restructuring plan that will deliver significant cost savings while sustaining collective investments. capacity solutions. drives our future growth.”

For the past few months, other tech companies have been laying off workers. Calm is cutting 20% ​​of its employees, Snap announced 20% layoffs, Twilio laid off about 900 employees, Meta said it would lay people off, and Microsoft laid off about 1,000 employees working in its Xbox and Azure divisions.

Quarantines due to COVID-19 are still affecting supply chains in China and the war in Ukraine, and the resulting sanctions are negatively affecting food and gas supplies. The demand for these goods exceeds the supply, which causes prices to rise. To prevent inflation from spiraling out of control, central banks such as the US Federal Reserve raise interest rates. Higher interest rates will reduce people’s disposable income, which means there will be less demand for scarce goods – which will ultimately lower inflation.

With less money left, people cut out services like Netflix or phone upgrades, hurting tech companies’ bottom line. As a result, these companies are reducing their more experimental business and focusing on their profitable products and services – unfortunately, this means that many employees are no longer needed by their respective companies. Source