Why 2023 may see even more jobs cuts

‘You’ve been fired’ or ‘Sorry, we’re going to fire you’ have become the scariest words for workers around the world as companies see mass layoffs one after another .

On January 5, e-commerce giant Amazon announced it would lay off 18,000 employees, almost 3% of its total workforce. On the same day, US business software maker Salesforce announced it was laying off about 8,000 employees, or his 10% of its workforce. Salesforce’s sole chief executive, Marc Benioff, after continuing to actively recruit during the COVID pandemic as millions of Americans work from home and demand for the company’s technology soars. , told employees in a letter that he blamed himself for the layoffs.

These job cuts are in line with other large companies announcing job cuts in the final months of 2022 and in January of this year. After the holiday lull, more job cuts are on the horizon, with various companies led by tech companies set to lay off thousands of employees.

Let’s see what the situation is like and how bad it is this year.

who was fired?

As previously mentioned, Amazon and Salesforce have already announced massive layoffs of their employees in the first week of January this year. This is in line with job cuts in the tech industry in 2022. Tech giants like Meta, Twitter, Netflix, Intel, Apple, and even Amazon have announced job cuts over the past year.

according to the website layoff.fyiIn 2022, more than 1,000 companies will lay off 152,000 workers, according to the government. Another report from Challenger, Gray and Christmas, which has tracked the job market for nearly 30 years, found the biggest surge in tech layoffs in November, when about 53,000 jobs were cut.

Graphics: Pranay Bhardwaj

In addition to Amazon and Salesforce, Adobe has cut about 100 people to focus on sales. Chime Financial Inc, a digital banking startup, has also announced 160 job cuts. His video hosting platform Vimeo announced two days ago via LinkedIn that the company was laying off his 11% of its workforce amid “tough times.”Major cryptocurrency exchange Huobi is about to lay off about 20% of its workforce

Acquired by Elon Musk in October 2022, Twitter is currently taking the hardest hit from its peers. Social media platforms have displaced about 3,700 jobs through email. Another social media giant, Meta, has also cut his 13% of the company’s workforce, laying off 11,000 people.

Tesla has announced it has laid off 200 of the 350 employees working on Autopilot, which looks like Tesla’s crown. In June 2022, Netflix laid off 300 employees after losing subscribers for the first time in over a decade.

Music streaming company Soundcloud also laid off employees, affecting 20% ​​of the company. His Flipboard, a major news aggregator, has also laid off his 24 employees, representing his 21% of the workforce.

Explains why Amazon's 18,000 employee layoffs are just the tip of the 2023 iceberg

Online giant Amazon, which employs 1.5 million people worldwide, has announced it will lay off 18,000 people. This cut is believed to be the largest in the company’s history. AFPMore

report in live mint says more than 30,000 workers worldwide have lost their jobs in less than a week into 2023. This is double his number of people who will lose their jobs in December 2022. The layoffs in 2022 were more serious layoffs than the Great Recession the world experienced from 2008 to 2009, which began with the collapse of Lehman Brothers.

Global Outplacement and Career Transition Firm 65,000 technology employees lost their jobs in 2008, according to data collated by Challenger, Gray & Christmas, a global outplacement and career transition firm. world.

More layoffs coming?

And if people think the worst is over, think again. There will be more layoffs this year, both in the tech world and beyond.

Cisco Systems has announced that it will begin a restrictive plan that will affect about 5% of its workforce. HP Inc plans to cut up to 6,000 jobs over the next three years, the company said, slashing profits.

Twitter, which has already had mass layoffs in the previous year, will continue the trend. The company reportedly laid off dozens of employees in its trust and safety teams in its offices in Singapore and Dublin in January. The report added that a series of recent layoffs also eliminated roles related to misinformation, global allegations and policy on state media.

Seagate Technology said it is cutting about 3,000 jobs. CEO Dave Mosley said:

Explains why Amazon's 18,000 employee layoffs are just the tip of the 2023 iceberg

Goldman Sachs is likely to begin laying thousands of jobs across the company. AFPMore

In addition to these, Goldman Sachs is likely to begin laying off thousands of jobs across the company from Wednesday, two people familiar with the matter said.Sources speaking to news agencies Reuters He said he expects the job cuts to be 3,000, but the final number has yet to be determined. Goldman Sachs layoffs are likely to be focused on investment banking, but they will also affect most of the major divisions. Loss-making consumer businesses are also likely to lose hundreds of jobs.

Fast-food giant McDonald’s is also planning job cuts as part of a major restructuring, with the layoffs scheduled for April. McDonald’s CEO Chris Kempzynski wrote an internal memo informing employees of the impending layoffs, according to a CNN report.

San Francisco-based online apparel service Stitch Fix is ​​also set to make layoffs, with nearly a fifth of its office workers likely to be laid off, interim CEO Katrina Lake said in a memo to staff. rice field. Cryptocurrency lender Genesis is also set to make job cuts, reportedly affecting her 30% of staff, as he cuts the struggling lender’s workforce to 145.

Explains why Amazon's 18,000 employee layoffs are just the tip of the 2023 iceberg

Fast food giant McDonald’s is also planning job cuts as part of a major restructuring.AFP

But why cut?

But while all these companies are laying off employees, the question still arises as to why they are laying off so many people. Experts say the main reason for this he is the COVID-19 pandemic. They explain that in 2020, as people entered quarantine and life moved online, companies hired in large numbers. However, as normalcy is restored around the world, these companies will have to revise their numbers and staffing.

There are other pandemic-related reasons. Daniel Keum, Assistant Professor of Business Administration at his School of Columbia Business, said: forbes Over the past few years, companies may have resisted laying off employees due to the negative attention and cruelty of layoffs at the depths of the pandemic. Additionally, companies may have postponed layoffs because they found it difficult to judge employee performance. Now, with more companies returning to the office at least part-time, management is considering layoffs that may have previously resisted.

Besides the COVID-19 pandemic, the war between Russia and Ukraine is another reason for mass layoffs. The war, now in its 320th day, has caused a major economic decline worldwide. With supply chains disrupted, interest rates and fuel prices rising, inflation headwinds mounting, and the world facing a recession.

Companies realized that newly hired employees proved to be expensive. Fears of a recession and slowing growth are also forcing companies to restructure and cut costs.

Ketan Godkhindi, Chief Strategy Officer at Witzeal Technologies, a gaming technology company based in Gurugram, said: Quint“2023 will be a year of maintenance as companies in a pretty bad patch look to cut bench power. Economists say next year will be defined by a mild recession and slowing growth This may cause companies to delay adding personnel.”

So if 2022 was bad, it doesn’t mean 2023 will be better. I hope there are no scary pink slips in our future.

With input from agency

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