Imagine working for one of the largest technology companies in the world with a not bad position and income. It’s your time, it’s technology. In addition, the company where you work every year billions of dollars in revenue explains, so it seems to be working fine. You feel safe, right?

But unfortunately for tens of thousands of workers in the tech industry in recent months, It wasn’t like that at all. Almost every company that comes to mind when you think of the “giant tech company” has laid off thousands of employees.

The magnitude of the layoffs is so great that by 2022 the number of layoffs in the technology sector will have increased by 649% over the previous year;

Moreover, many experts say this is just the beginning and things will move along a similar line in 2023; there could be more layoffs. say.

Before moving on to the causes of this discouraging situation’How many people can be fired?‘, let’s take a quick look at the companies and numbers to answer the questions;

• Amazon – 18,000+ employees
• Meta – 11k+ employees
• Alphabet (Google’s parent company) – 12,000+ employees
• Microsoft – 11k+ employees
• Xiaomi – 3,500+ employees
• Twitter – 3,700+ employees
• HP – between 4 thousand and 6 thousand employees
• Coinbase – 1200+ employees
• Snap – 1200+ employees
• Spotify – 600 employees
• Netflix – 450 employees
• Tesla – ~10,000 (For Tesla, the figure is not yet known, but Musk said last June that 10% of employees should be laid off, which amounts to about 10 thousand people)

This is reported by layoffs.fyi, which collects layoffs in the tech sector 158 thousand 951 in 2022, Since we entered the year 2023, 55,970 employees have been laid off. As you can see, layoffs are not only happening at giants, but across the industry. The giants we mentioned above naturally meet the majority of these numbers with their gargantuan staff.

Let’s come to our question; Why are giant corporations with billions of dollars in revenue laying off tens of thousands of workers?

Looking at the companies’ statements, the goal is generally ‘reduce costs’. Industry experts, on the other hand, see this as an excuse and say the main reason is the wrong steps taken by all the tech giants during the pandemic period.

Unfortunately, workers hired for the “temporary needs” of the pandemic process are starting to become unemployed in the middle of the economic crisis;

The pandemic had been a strange time for tech companies to talk about massive growth. Many technology giants from Amazon to Microsoft are based on their growth during this period. they added tens of thousands of employees to their structure.

At Microsoft, for example, which had 144 thousand employees in June 2019, this number rose to 163 thousand in June 2020, 181 thousand in June 2021 and 221 thousand in June 2022. good Microsoft has hired more than 75,000 employees during the pandemic.

Here are the steps that do not consider this future, to mitigate the impact of the pandemic even today, when it started to completely disappear, it caused layoffs.

According to some experts, the only effect of the pandemic is not the tens of thousands of workers who have been brought into the workforce due to increasing needs;

During the pandemic period, especially tourism, transportation, etc. Many people were unemployed in disrupted industries.. Despite this, efforts were made to avoid major redundancies, including government support for employers.

According to some experts, at a time when the whole world is in crisis. firing would seem pretty brutal and companies postponed the layoffs as long as possible, as this would damage the image of the company.

At the same time, in this process experiencing remote working and difficult adjustment process, failure to make proper performance assessments It is suspected that the dismissal procedures have been postponed for this reason.

In addition, the effects of the ongoing war between Ukraine and Russia affect people thousands of miles away from the war;

The war between Ukraine and Russia, which has been going on for almost a year, has dealt a major blow to the global economy, which has not recovered from the fatigue brought on by the pandemic. Experts, along with all the other reasons war and the recession in the world economy It also states that it has an impact on layoffs.

Many conditions, such as inflation, rising interest rates, rising fuel costs and supply chain deterioration, affect all industries. The technology sector, where layoffs seem absolute for the reasons we listed above, is also benefiting.

There is another idea that is quite striking and reveals the brutality of the corporate world;

According to Jeffrey Pfeffer, a professor at the Stanford Graduate School of Business, this is a cascade none of the layoffs are based on realistic reasons and there is no evidence that redundancies were necessary. Given the steady rise in revenues of nearly all giants that have made major layoffs in recent years, this claim seems true.

Pfeffer says the layoffs are an example of “social contagion” between companies. Simply as companies see other examples ‘We also have to drop out’ According to him, there is pressure from the board of directors in that direction.

In his view, layoffs do not bring any benefit to companies because severance payments, unemployment insurance costs and productivity losses due to stress in the business environment, returns to businesses as a loss. Pfeffer emphasizes that scenarios such as contraction in the sector and hiring too many employees are correct, but that this is never the main reason why ‘these companies make a lot of money’.

Whatever the reason, industry experts insist that we will hear more similar news in 2023 and layoffs will continue…

Source; Stanford University, Layoffs.fyi, TechCrunch, CNN Business, Fortune, Bloomberg