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TECHNOLOGY
It's the end of the boom times in tech, as layoffs keep mounting
UPDATED NOVEMBER 16, 2022 · 1:31 PM ET
Laurel Wamsley
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Amazon said Wednesday it had begun layoffs in its Devices and Services division.
Michel Spingler/AP
For more than two decades, the U.S. tech industry has been a reliable source
of booming stocks and cushy, high-paid jobs. In the span of weeks, the sheen
has faded and the ax has fallen.
More than 35,000 tech workers across 72 companies have been laid off this
month, adding to a total of 120,000 tech jobs lost this year, according to
layoffs.fyi, which tracks job cuts in the tech industry. It's safe to say a
reckoning is underway, even as each company is grappling with its own
challenges. (See: Twitter.)
Many of the companies making public statements have cited at least one of
two primary causes:
First, they hired a lot of employees during the pandemic, when people were
extremely online. Now, the internet boom has faded, offline life has picked up,
and those new employees seem too expensive.
Second, broader economic wobbles have made brands more reluctant to spend
on digital ads–a source of revenue for many tech companies. High interest
rates have put an end to the cheap-money era of venture capital.
Here are some of the companies that have announced the biggest job cuts.
Amazon: a reported 10,000 jobs
Amazon said Wednesday that layoffs had begun, though it did not state the
number of employees affected.
The online retail and cloud computing behemoth plans to lay off some 10,000
employees in corporate and technology jobs, The New York Times was the first
to report on Monday.
"After a deep set of reviews, we recently decided to consolidate some teams
and programs. One of the consequences of these decisions is that some roles
will no longer be required," wrote Dave Limp, Amazon's senior vice president of
devices and services, in a memo shared on the company's website.
As of this fall, Amazon employed more than 1.5 million full- and part-time
workers around the world, many in warehouses. The 10,000 expected layoffs
would comprise about 3% of Amazon's corporate employees, according to the
Times, and a significantly smaller share of its overall workforce.
The cuts reportedly will focus on Amazon's devices division, including Alexa,
the company's virtual assistant technology, as well as its retail and human
resources divisions.
Earlier this month, the company announced a hiring freeze on corporate jobs.
"We're facing an unusual macro-economic environment, and want to balance
our hiring and investments with being thoughtful about this economy," wrote
Beth Galetti, Amazon's senior vice president of people experience and
technology.
Meta: 11,000 jobs
Facebook and Instagram's parent company, Meta, laid off 11,000 people last
week – about 13% of its staff.
CEO Mark Zuckerberg attributed the cuts to overhiring during the pandemic. In
a letter to staff posted to the corporate website, he cited a decline in e-
commerce, the wider economic downturn, increased competition, and a decline
in ad sales–the primary way the company makes money.
TECHNOLOGY
Facebook parent company Meta sheds 11,000 jobs in latest sign of tech slowdown
"I got this wrong, and I take responsibility for that," he wrote.
The layoffs come as the company has invested billions in the so-called
metaverse, pitched as a virtual-reality future in which people will work,
mingle, exercise and go to concerts. But it's an unproven bet on the future, and
not all everyone is convinced it should be the social media company's focus.
Meta CEO Mark Zuckerberg made big investments in the "metaverse," which he showed off during a virtual event
last year. Last week, Zuckerberg announced the company was laying off 13% of its staff.
Eric Risberg/AP
Zuckerberg said the workforce cuts would affect the whole organization, with
recruiting staff disproportionately affected due to fewer hires anticipated in
the coming year. A hiring freeze through the first quarter of 2023 will continue.
Twitter: about 3,700 jobs
Billionaire Tesla and SpaceX CEO Elon Musk bought the social media platform
at the end of October and wasted no time slashing its workforce. He
immediately ousted the company's leadership, including its CEO, CFO, and top
lawyer. Mass layoffs were announced on November 4, with about 50% of the
staff cut.
"Regarding Twitter's reduction in force, unfortunately there is no choice when
the company is losing over $4M/day," Musk tweeted.
BUSINESS
Twitter layoffs begin, sparking a lawsuit and backlash
Co-founder and former CEO Jack Dorsey tweeted that he accepted blame for
hiring too many workers in recent years.
"I own the responsibility for why everyone is in this situation: I grew the
company size too quickly. I apologize for that," he wrote.
Musk's $44 billion purchase of Twitter – which he tried to get out of for
several months – has saddled the company with $13 billion of new debt.
His short tenure at the top of Twitter has been marked by hasty changes
quickly halted, including his plan for a revamped Twitter Blue verification
service, which charged $8 a month to get a blue checkmark on one's account.
Accounts impersonating celebrities, major corporations, and Musk himself
proliferated immediately, spurring Twitter to halt Twitter Blue signups twice
within a week.
TECHNOLOGY
Elon Musk says Twitter bankruptcy is possible, but is that likely?
Key executives who were not fired, including Twitter's head of content
moderation and safety on the platform, and the company's chief privacy officer
and compliance officer, resigned last week.
Stripe: about 1,000 jobs
Payment processing platform Stripe announced on November 3 that it was
cutting 14% of its workforce.
Stripe CEO Patrick Collison wrote in an email to employees that the pandemic
pushed the world toward e-commerce, spurring the company's growth.
The CEO said he and his brother and co-founder John Collison had made "two
very consequential mistakes": being too optimistic about the internet
economy's near-term growth, and growing Stripe's operating costs too quickly.
"We are facing stubborn inflation, energy shocks, higher interest rates, reduced
investment budgets, and sparser startup funding. ... [M]any parts of the
developed world appear to be headed for recession. We think that 2022
represents the beginning of a different economic climate," Collison wrote.
Salesforce: hundreds of jobs
Salesforce, which makes cloud-based business software, laid off some of its
employees last week, CNBC reported.
Salesforce said in a statement to NPR: "Our sales performance process drives
accountability. Unfortunately, that can lead to some leaving the business, and
we support them through their transition."
A source familiar with the cuts said they affected hundreds of employees in
the sales organization.
ECONOMY
Have you invested in crypto on FTX or other platforms? We want to hear from you
Microsoft: fewer than 1,000 jobs
The software company made cuts across its divisions last month, Axios
reported. Fewer than 1,000 jobs were cut, a source told Axios.
A request for confirmation of the layoffs was not immediately returned.
Zillow, Snap and Robinhood
Zillow, the online real estate marketplace, laid off 300 of its employees late
last month, TechCrunch reported. The company laid off 25% of its workforce a
year ago as it shuttered its instant buying service.
Snap, the company behind Snapchat, said at the end of August that it was
cutting its workforce by 20%. The layoffs affected some 1,200 employees, with
the company's full-time workforce about 6,400 as of June.
Robinhood, the brokerage app company, laid off 23% of its workforce in
August. That amounted to 780 employees, according to Bloomberg. The
company had already reduced its staff by 9% in April. "This did not go far
enough," wrote Robinhood CEO Vlad Tenev.
NPR's Alina Selyukh contributed to this story.
tech meta amazon layoffs twitter
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