A worrying trend has been developing over the past few months. In an attempt to reduce costs, businesses are cutting back on their workforce after a surge in hiring at the world’s biggest companies.
Although it seems like yesterday that there were many job opportunities, companies are now preparing for a possible recession.
According to Crunchbase News, this is more than 37,000 tech workers who have been laid off in the U.S. so far this year.
Businesses increased their workforce to meet the skyrocketing demand in the months after widespread adoption of Covid-19. They didn’t know that rising inflation rates would slow down the demand.
Companies have one goal: to weather the recession.
Layoffs by some companies
Employees of European TikTok were informed in July that their jobs might be at risk due to the company’s business restructuring efforts.
Anna Sopel, TikTok spokesperson at the time, stated that “there are a few roles within the operations, marketing teams that have shifted in focus. That can’t be called an ‘companywide restructure.'”
Employees across Europe and the U.S. were informed that they could be at risk despite their refusal to undergo a complete restructuring.
Twitter announced a hiring freeze in July and revealed that 30% of its acquisition staff had been laid off. In recent months, Twitter has experienced major turmoil.
The company is still trying to hold on to its Elon Musk takeover deal. Although the outcome of the lawsuit is still months away, layoffs could continue to hamper Twitter’s profitable growth.
Groupon, an online coupon site, announced that it had cut 15% of its staff — more than 500 people.
Groupon, like other companies, is trying to cut costs and get on the right track for net profit at the end of the year.
Kedar Deshpande (CEO of Groupon) stated that Groupon’s overall business performance was not as good as we expected and that he is taking action to improve it.
Robinhood announced, months after having made a complete commitment to remote work arrangements, that it would be firing 23% of its employees.
Vlad Tenev, CEO and cofounder, also cited overhearing to be the primary cause of these layoffs. The company needed more staff to keep up with the retail boom last year.
But, as the business slowed down, the company found itself with an excess workforce and insufficient revenue.
New Tesla employees were told in June that they would be fired after only a few months of service.
Electric vehicle manufacturers also pulled job offers. This was apparently based on performance reviews. However, former employees claim they didn’t work long enough at the company to support a performance review.
This was after Elon Musk, CEO, said he felt a “super bad feeling about the economy” and that Tesla might have to lay off 10% of its employees.
Companies that have halted hiring or teased layoffs
“Realistically there are probably some people at the company that shouldn’t be.”
This is what Mark Zuckerberg said at a Meta all-hands meeting recently. The CEO spoke about the company’s current structure, future plans, and the coming economic downturn.
Zuckerberg stated in June that Meta’s engineering team could face significant cuts. The tech leader seems to encourage employees to leave, even though he didn’t explicitly state it.
Google, which is in a slightly better position than other companies, announced in July that it would slow its hiring efforts.
CEO Sundar Pichai stated that the tech giant will continue to look for new talent but would instead focus on technical roles because the future of the economy is in doubt.
Pichai stated, “We must be more entrepreneurial and work with greater urgency, sharper focus, and more hunger than what we have shown on sunnier days.”
Microsoft has a number of job openings that were closed last month due to economic concerns.
The company stated that its current job opportunities would remain in place, despite the fact that it had reduced its hiring efforts across many sectors of its business including its Azure public cloud division.
Spotify is a leader in the music streaming industry. Last June, it announced that it would reduce its hiring efforts by 25%.
It is one of many tech companies that have struggled to survive in a world of falling stock prices and rising operating costs.
A spokesperson for Spotify Adam Grossberg stated that the bear market hadn’t had a “material impact on our business” yet but that it was monitoring the situation and “evaluating the future headcount growth.”
This post was written by Tara Kintz. Tara is a director at Signature Workspace. Signature Workspace, owned and operated by Cantor Fund Management, offers services and amenities such as private offices, flex space, co-working space, virtual offices, meeting/conference rooms, and more.