Over 2000 People A Day Lost Their Jobs In Tech
The year 2023 has started on a high note for job seekers. The job market is becoming more competitive as many companies, particularly tech giants, unicorns, or startups, cut thousands of employees. In 2023, more than 2,700 people lost their jobs per day. According to available data, 1.53 million people have been affected. For those who are lucky enough to have a job, they can expect a decrease in their pay or no increase. Many people who are hired are having trouble due to long onboarding procedures. Recession worries and other macroeconomic risk are potentially even more dangerous than seasonality.
It’s difficult to find work these days. The industry’s growth is slowed by high inflation, international tensions, the rate-hike cycle and persistently low unemployment. The world’s largest economies are concerned about a recession.
Meta, Google and Amazon are just some of the tech giants who have recently laid off tens to thousands of workers. Last year, Microsoft had fired 10,000 people and Google had fired between 6,000- 12,000 people. Meta had fired an astounding 11,000. To top it all, Amazon, the largest employer ever, announced the layoffs of 18,000 employees. After he took control of Tesla’s account last year, Elon Musk, the CEO of Tesla, fired many people from Twitter. Similar to Dell Technologies, 6,650 workers were laid off.
We’re likely to see more layoffs in the near future. Ericsson, the telecom giant and Facebook’s parent company, recently announced plans for thousands of layoffs. McKinsey is another consulting firm in the same situation and will lay off 2,000 employees.
It has been reported that Amazon could reduce salaries by up to 50 percent in 2023. Contrary to popular belief, Google now requires workers to share their desks. Many workers are still waiting for their onboarding, despite having been hired by different companies.
According to data from Trueup.io which tracks tech layoffs (2.732 people per hour), 534 layoffs by technology companies have so far impacted 153,000.055 people in 2023.
The statistics show that approximately 241,176 people were directly affected by the 1,535 layoffs in tech companies in 2017.
Ujjal de, CEO of KarmaV (a company that assists businesses of all sizes to improve their employer brand, streamline their hiring processes), stated that “uncertainty” will overshadow the job market in 2023. Different sectors will experience uneven recovery signs and will require a cautious approach to an impending recession.
These aren’t all the reasons for staff cuts. After a pandemic, the demand for IT services rises as time passes, but at a moment when sector valuations are in decline. Startups are being pressured to adopt conservative hiring strategies, while increasing their profits.
KarmaV’s founder made the observation, “In the wake of the pandemic overvalued IT companies have started massive layoffs as the demand returns to pre-pandemic levels, and valuations fall.”
He explained that investors are less willing to take on risk and have pushed startups and SMBs to be more conservative in their hiring strategies and focus on their bottom lines.
Chatbots and other AI tools are gaining popularity. Their widespread use is expected to increase output, allow humans to concentrate on more difficult tasks, and improve their flexibility and efficiency.
Now the question is: When will the season of layoffs come to an end? It is most likely to end by 2023.
KarmaV’s founder predicts a boom of business in the second quarter of 2023, especially for those who have a background in banking, financial services and the insurance industry (BFSI), due to the rapid digitalization.
He said, “Improvements to infrastructure, like 5G, will hasten smart cities initiatives and revolutionize production, transport, healthcare, and retail sectors.” As the domestic startup ecosystem and R&D centers experience renewed energy, there will be a surge in demand for tech professionals who have edge computing AR/VR, data analysis, and AI skills.