Making Sense Of Tech Layoffs
Who, Exactly, Is Getting Laid Off?
A CNBC article written in mid-January revealed that tech companies have laid off more than 70,000 employees in the last year — Google announced it would lay off 12,000, Microsoft is cutting 10,000 workers through March 31, and Amazon is planning to cut more than 18,000 employees. This article by Crunchbase states that more than 140,000 jobs were cut in 2022.
More than a few people on Reddit have pointed out that these numbers do not tell the whole story. If you write that thousands of tech workers were laid off, it leads to two natural questions:
- What constitutes a tech company?
- What constitutes a tech worker?
Before I continue, I am going to put up a critical comment I received on one of my blogs.
For the umpteenth time, this will be a blog post that basically just lists a bunch of articles and then comments on/rambles about them.
Why Is This Happening?
Clement has a pretty good explanation linked below. The factors include inflation, high interest rates (which were raised in response to inflation), and over-hiring. Meta, which hired 20,000 people in 2022 before cutting 11,000 (at least according to Orosz, in this ChangeLog podcast episode), is a good example of why this should be taken into consideration.
I think there are a number of reasons Google has made so many headlines:
- Though they very recently released a disappointing fourth-quarter earnings report, this is still a company that has historically been very profitable. It is difficult to put them in the same category as Meta, which faced challenges due to competition with TikTok, an obstacle related to Apple, and a Snow Crash inspired technology called the Metaverse
- Google is famous for treating its employees really well. Does your office have a secret passage? What about free back massages and yoga studios? Maybe your office does have a secret passage, but no one told you about it
- Google’s execution has been, for lack of a better word, strange.
From tech.co:
According to CNBC, some of the 12,000 employees leaving the company woke up, to their bemusement, to find their access to Google company properties blocked…But what really shocked staff was the number of high-profile and newly promoted Google employees present among those being laid off, leading many to question the nature of the criteria used to select employees for redundancy.
— Source
Google does not seem to have laid people off based on performance, and layoffs were so sudden that even the Dave Ramsey Show made fun of them. There are reports that employees were simply locked out of their accounts without any sort of notice.
How Has This Impacted Software Engineers?
Once again, the number of tech workers laid off does not tell the whole story. The article based its findings on layoffs.fyi, but admitted that the data is provided voluntarily. They had the following findings from 2022 layoffs:
- 20% of those laid off were salespeople
- 5% were engineers
- 3% were in finance
This article by 365DataScience analyzes 1157 LinkedIn profiles of those laid off from November 2022 to January 2023 to determine a trend:
- 27.8% of those laid off worked in HR and talent sourcing
- 22.1% were software engineers
- Marketing employees were 7.1%, customer service was 4.6%, and PR, communications, and strategy was 4.4%
365DataScience further breaks down its data. Of the 300 in its data set laid off from Twitter, 23.7% were software engineers are 12.7% were in marketing. Of the 257 in their sample set laid off from Amazon, 28.8% were software engineers and 37.4% were in HR and talent sourcing. At Meta, of 208 employees 18.3% were software engineers and 29.8% were HR and talent sourcing.
At Microsoft, of 142 employees, 13.4% were software engineers and 39.4% were HR and talent sourcing. At Google, of 102 laid off 35.3% were software engineers and 16.7% were program managers.
I know what you are probably thinking: These are pretty small sample sets, they are not up-to-date, and this is not exactly random sampling. Unfortunately, both sources draw from biased data.
Random Thoughts
In light of these numbers, I find some of the comments on Reddit to be dismissive. Significant portions of software engineers are being cut from some of these major tech companies; but yes, their complaint that “tech worker” is a very broad term are valid.
I enjoyed this ChangeLog podcast episode I mentioned earlier, which directly contrasts an episode from March about “the insane tech hiring market.” Some of the advice, though solid, is admittedly cliche
- If you are still working in tech, try to save more money
- Try to weather the storm and hold to your network, in case you need them
- Strive to be in the top 25% of performers and align yourself within your company’s profit center
Wow, thanks for that surprising and unexpected advice.
I will link again to my HackerNoon article, which I think was an inspiring story — a developer named David Ballowe landed a full-time job without needing a college degree or bootcamp. This is not the path I took, but it serves as a reminder of what it takes to succeed in this field: Discipline and passion, rather than the amount of money you invested in a program.
I would also be curious to hear if the hiring process has changed this year. Are companies still using the same LeetCode/system design interview process from before? If so, is it more rigorous? If not, is it because profitable tech companies have recognized that it is easier to simply auto-hire anyone laid off from a prestigious tech company like Google?
