Big tech companies are in our news every day with great news. However, in the last 1 year, big tech companies have laid off more than 70,000 people globally. This doesn’t even count the downstream effect on contractors and those that depend on it.
What has Led to this Massive Shakeout?
Since the hiring spree that happened during the pandemic, very huge numbers of employees have been fired from various tech companies.
- Alphabet-12,000
- Amazon-18,000
- Meta-11,000
- Twitter-4,000
- Microsoft-10,000
- Saleforce-8,000
Other major names that are in the spotlight include Spotify, Netflix, Tesla, Robin Hood, Coinbase, and Snap. However, their layoff numbers are slightly lower compared to the rest.
The downstream effect of these layoffs by big tech companies affects advertising agencies. Ad spend reduces significantly.
The long-term effect of these lay-offs is that it will be felt in the consulting, marketing, advertising and manufacturing spaces. Companies will cut down on spending and direct it towards AI.
What’s the Cause of the Layoffs?
The leading cause is reduced spending in various industries. Various tech companies are funded via advertising.
In the years leading to COVID-19, the income stream was decent, and expenditure and staffing were too. However, advertising was reduced last year due to fears about a global recession caused by the pandemic. That’s why layoffs in Big tech are endemic.
What does this mean to consumers?
The headlines are scary but they won’t cause too much effect on the consumers. In total, work on tech products is still growing. A great example is Twitter, even though many people thought it was doomed, they are diversifying its stream revenues.
However, the recent layoffs won’t affect overall economics that much. These numbers are just a fraction of the technology workforce. Most of these numbers of guys getting laid off by big tech are those hired during the pandemic.
Big tech will still employ people and impact the various aspects of our lives.
