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From Meta to Coinbase, tech companies are slowing hiring: Here’s why

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Oracle has reportedly begun laying off employees in the US. While the actual number of employees being laid off remains unknown for now, according to a report by The Information (via IANS), layoffs are happening across all positions including CX pre-sales engineers and marketing, CX Commerce, analyst relations, talent acquisition, CRM and even programmers. The report also states that in addition to layoffs in the US, the company also planned to cut jobs in Canada, Europe and India in the coming months. The move is part of the company’s effort to target up to $1 billion in cost reductions in an effort to serve one of its newest cloud clients — TikTok. Also read – Google boss warns employees about insufficient productivity, tells them to start working

While Oracle may be opting for cost-cutting measures to ramp up its operations to make room for new customers, it’s not alone in the tech world opting for such drastic measures. Companies in various domains, from giants like Google, Apple and Meta to crypto companies like Unocoin and Coinbase to gaming giants like Niantic and NVIDIA to streaming platforms like Netflix and Spotify are slowing hiring or firing employees around the world. . Also Read – How to Create or Delete Netflix Profiles: Step by Step Guide

Interestingly, these all happen around the same time, which points to a larger trend or reason why this is happening. We’ll talk about that soon, but first we’ll talk about all the recent events. Also Read – Microsoft Brings Outlook to Budget Android Smartphones with Outlook Lite App

Tech companies that have announced layoffs or a hiring slowdown

Google

Alphabet Inc CEO Sundar Pichai said in a letter to employees last month that the company would slow hiring for the rest of the year. In the letter, he also said that Alphabet hired 10,000 new employees in the second quarter of the year, and for the rest of the year and 2023, the company will hire people only for key roles.

“Due to the hiring progress achieved so far this year, we will slow the pace of hiring through the end of the year while continuing to support our most important opportunities. For the remainder of 2022 and 2023, we will focus our hiring on engineering, technical and other critical roles and ensure that the great talent we hire is aligned with our long-term priorities,” he said in the letter, as reported. by Bloomberg.

Microsoft

Microsoft cut jobs across all divisions in the past months after releasing its quarterly earnings report on June 30, 2022. The layoffs, according to a Bloomberg report, affected less than one percent of the company’s workforce and were part of the company’s move to “evaluate our business priorities on a regular basis and make structural adjustments accordingly.”

Amazon

Amazon earlier this week laid off 1,00,000 workers mostly from its distribution and fulfillment centers, the biggest single cut in recent memory. The company employs 15 million workers worldwide. The company laid off 27,000 employees in the first quarter of this year.

“I think it’s right for people to step back and reevaluate their employment plans. We do it too. I don’t think you’re going to see us hiring at the same pace as last year or the last few years,” Amazon Chief Financial Officer Brian Olsavsky said on the company’s earnings call.

Target

And Meta has announced its plans to permanently reduce the number of employees over the next year. During the company’s earnings call last month, Meta founder Mark Zuckerberg said the company had hired a lot of people earlier this year and that the number of employees will be sufficient for the next few quarters. He also said many teams will downsize. “Now this is a period that requires more intensity and I expect us to do more with fewer resources,” he said during the earnings call.

He also said Meta was leaving certain positions unfilled in response to attrition and focused on performance management to eliminate staff unable to meet more aggressive targets.

Apple

Apple, according to a Bloomberg report, plans to slow hiring in 2023. Although the company is not taking any drastic measures, according to a Bloomberg report, some groups will not see an increase in staff next year, while some positions will not be filled.

Twitter

Twitter has been laying off employees since Elon Musk’s takeover bid began. That includes the company’s top executives, some of whom also spoke about the sudden layoff on Twitter. Recently, the company laid off 30 percent of its talent acquisition team. The move comes after the company announced a company-wide hiring freeze in April of this year.

Uber

Similarly, Uber announced a hiring slowdown. In an email to employees in May of this year, Uber CEO Dara Khosrowshahi said the company “will treat hiring as a privilege and make thoughtful decisions about when and where to add employees,” CNBC reported. The move comes despite Uber’s revenue more than doubling to $6.9 billion in the first quarter of the year.

Netflix

Netflix laid off another 300 employees in a second round of layoffs in June of this year, representing about three percent of the company’s workforce. “We are unfortunately laying off approximately 300 employees today… While we continue to invest significantly in the business, we have made these adjustments so that our costs are rising in line with our slower revenue growth,” the company said in a statement. from CNBC.

Spotify

Similarly, Spotify CEO Daniel EK said in a letter to employees that the company is slowing hiring by as much as 25 percent. He said the company will continue to hire new talent, but will be more prudent in its approach.

Niantic

Pokemon Go-maker Niantic laid off eight percent of its 85-90 position workforce last month. The company also canceled four projects including Transformers: Heavy Metal. According to reports, Niantic’s CEO said in an email to employees that Niantic is ‘facing a time of economic turmoil’ and needs to further streamline its operations’ to weather future economic turmoil.

Unity

Back in June of this year, Unity laid off about four percent of its global workforce, which is about 300 to 400 employees. While the company did not provide a reason, a spokesperson told PC Gamer, “As part of an ongoing planning process where we regularly assess our resource levels against our company’s priorities, we have decided to reallocate some of our resources to better focus and support our long-term growth .”

Tesla

Tesla CEO Elon Musk, speaking at Bloomberg’s Qatar Economic Forum in June this year, said he plans to cut the company’s paid workforce by more than 10 percent over the next three months given the current macroeconomic conditions.

“Tesla is reducing its paid workforce by approximately 10% over the next probably three months or so… It’s quite clear that we expect to increase our hourly workforce. We’ve been growing very fast on the payroll side and we’ve been growing a little bit too fast in some areas, so that requires reducing the payroll workforce,” Musk said at the time.

Coinbase

Similarly, Coinbase also announced a hiring slowdown. Coinbase CEO Emilie Choi said in a blog post, “We are announcing that we are slowing hiring so we can re-prioritize our hiring needs against our priority business goals.”

Apart from these companies such as Unocoin, NVIDIA, Snap and WazirX have also announced similar measures.

In India, ed-tech startup Udemy cut 1,000 jobs in April. Similarly, Byju reportedly laid off 2,500 workers, while Unacademy laid off 2.6 percent of its staff in June this year.

These are some of the many tech companies that have laid off employees this year. According to numbers compiled by Crunchbase, more than 32,000 tech workers were laid off in tech in the US through July 2022. That number is much higher in India where more than 43,000 workers were laid off at 342 companies as of April 1, 2022. This brings us to the most important question — why are companies around the world slowing hiring and downsizing?

Why is this happening?

There are many reasons for this, and the answer is anything but simple. For some companies, the move may be seen as a way to offset the over-hiring they have done in the past, as happened with Amazon and Apple, for others it may be seen as a way to combat slow growth and declining subscribers, as is the case with Netflix and A target. There is also a third category of companies that are just trying to keep their heads above water. As Twitter CEO Parag Agrawal recently said in a town hall meeting with company employees — “Our costs are greater than our revenues. That’s not a good thing.”

In addition, the uncertain economic condition or the impending recession is what acts as a key factor that triggers these precautionary but drastic measures. While some technical executives have openly discussed this with their employees, others take a more reserved approach.

“The uncertain global economic outlook was the main theme. Like all companies, we are not immune to economic problems. Something I appreciate about our culture is that we have never looked at challenges like these as obstacles. Instead, we saw them as opportunities to deepen our focus and long-term investment,” the CEO of Alphabet Inc said in a letter to employees.

Zuckerberg also didn’t shy away from talking about it when he said, “If I had to bet, I’d say this could be one of the worst downturns we’ve seen in recent history,” in a weekly employee Q&A session last month (as reported by Reuters). . Similarly, when asked about a looming recession at QEF, Musk said: “I think a recession is inevitable at some point. As for whether there’s going to be a recession soon, I think that’s more likely than not.”

Spotify spokesman Adam Grossberg pointed to comments from Spotify CFO Paul Vogel at the company’s investor day, who said: “We are clearly aware of the increasing uncertainty surrounding the global economy. And while we have yet to see any material impact on our business – we are closely monitoring the situation and assessing the growth of our workforce in the near future.”

Uber’s CEO, on the other hand, took a more restrained approach when he said, “It’s clear the market is experiencing a seismic shift and we need to respond accordingly,” in an email to employees.





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