Tech giants continue to cut jobs: Latest layoffs

By Polina Fomenkova, PR writer at F1V

Last year, tech companies fired 160,000 people — a shocking figure. And, as January shows, mass layoffs are far from over. In the first month of this year, tech giants fired a record 70,000 employees.

Mass layoffs are a result of over-hiring in the last two years. During the first year of the pandemic, people spent more than ever on digital services, which is a trend no more. In 2022, the global economy dipped, people became more frugal, and tech companies had to adapt.

Here’s a roundup of some of the recent tech layoffs. This list is not comprehensive.

The pandemic was a tremendous growth driver for Amazon. In two years, the corporation has doubled the size of its operations and nearly doubled its workforce — from 798,000 in 2019 to 1.6 million people in 2021.

But now retail sales have slowed and costs are rising. Therefore, the company decided to cut 18,000 jobs (mostly in retail and recruiting), the largest workforce cut in its 28-year history.

Google's parent company Alphabet announced on Jan. 20 that it is laying off 12,000 employees. The company will give its fired US employees 16 weeks of severance pay, also adding two weeks on top of that for each year these people worked at the company.

Meta is another company that was actively hiring during the pandemic — its workforce grew by 60%. In 2022, however, Meta's operating profit dropped by 46% year over year, to $5.66 billion.

In November 2022, Mark Zuckerberg said the company would cut 13% of its jobs, meaning over 11,000 people.

Last October, Microsoft's quarterly revenue increased by just 2%, the lowest rate since 2016.

"We will align our cost structure with our revenue and where we see customer demand," CEO Satya Nadella told Microsoft employees, announcing the layoff of 10,000 people on Jan. 18. It is about 5% of the corporation's global workforce.

Most of the layoffs will affect sales and marketing departments.

In January, Salesforce announced that it was reducing its staff by 10%, which is about 7,000 employees.

Analysts have estimated that staff reductions will help Salesforce reduce operating expenses by more than $1.5 billion a year and widen the company’s operating margin to 26% from 21%.

By the end of 2025, HP Inc. plans to cut up to 6,000 jobs, about 12% of its global workforce, to navigate a potential economic downturn. This will cost the company about $1 billion in labor and non-labor costs related to restructuring.

In June, Tesla announced it would make redundant at least 10% of its workforce, which is about 6,000 employees.

Its CEO Elon Musk told the staff that the company had become "overstaffed." He added that the layoffs would not affect those who build cars and battery packs.

In December, he announced a new wave of layoffs. Musk still denies that Tesla has problems and said he was cutting jobs because of the interest rate growth and the market’s general volatility.

In November, Twitter CEO Elon Musk fired nearly half of Twitter’s staff (4,400–5,500 contract employees), who one day found out that they were logged out of their email and Slack accounts.

Musk said he had to do it because Twitter was losing $4 million a day. In January, Twitter cut at least a dozen more jobs at its Dublin and Singapore offices.

Even though IBM exceeded its last quarterly revenue target by $300 million and net income rose 16% to $2.71 billion, it still decided to cut 3,900 jobs.

The reason is the weak asset sales in 2022 and the failure to meet its annual revenue target. The corporation is now making efforts to cut costs and has already set aside $300 million to cover future layoffs.

At the same time, hiring won't stop, as it looks for specialists for client-facing research and development.

Coinbase Global Inc. cuts about 950 jobs as part of its restructuring plan. This has been the third round of layoffs at the cryptocurrency exchange since 2022. Coinbase expects to incur a total of $149–163 million in restructuring costs.

In January, the Swedish-based music streaming company announced that it started to optimize costs and is forced to fire 6% of its team.

According to Spotify CEO Daniel Ek, the laid-off workers will receive five-month severance pay and can keep their health insurance for the period. It will cost Spotify €35-45 million.

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