Paywalled. But the title sounds about right.

> In Silicon Valley, the new year began as the last one ended — with tens of thousands of tech workers losing their jobs. Just a few days into 2023, Amazon Chief Executive Andrew Jassy announced that there would be 18,000 layoffs across the company. Within weeks, Microsoft revealed it was slashing its head count by 10,000 and Google said that it was terminating 12,000 employees. IBM looks to be next, with nearly 4,000 workers on the chopping block.

>This follows 2022’s bloodbath, when tens of thousands of jobs were lost at Meta Platforms, Twitter and Salesforce. According to an industry layoff tracker, the tech sector has eliminated some 220,000 jobs since the start of last year. If the laid-off tech workers formed a city, it’d be one of the most populous in the United States, bigger than Des Moines or Salt Lake City.

>The question is: Why have many of the most profitable companies of our generation — most of which are still very much profitable — announced staggering rounds of layoffs, one after the other? And why now?

>A common refrain from analysts and reporters is that the companies are “tightening their belts” after profligate pandemic hiring sprees, in order to streamline operations. The executives overseeing the cuts, for their part, cite adverse economic circumstances. “We hired for a different economic reality than the one we face today,” Google CEO Sundar Pichai said in his layoff announcement. Jassy wrote that “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.” Microsoft’s Satya Nadella noted that “some parts of the world are in a recession and other parts are anticipating one.”

>No recession has yet hit the U.S. or its tech sector. Inflation hurts, but the U.S. economy added hundreds of thousands of jobs last month. Still, certain shareholders have been vocal about their desire to see head counts trimmed — and trimmed further still.

>To that end, critics argue that simple greed is driving the layoffs; they point to the tens of billions’ worth of stock buybacks the tech companies authorized last year. The Verge’s Liz Lopatto spoke with industry analysts who said that tech companies are evaluating their bottom lines differently, and concluded that they’re doing layoffs mostly because everyone else is, even though layoffs actually often cost a given company money. And the fact all these layoffs are happening in such rapid succession gives the companies some cover — making them seem elemental, inevitable.

> Company bikes sit outside an office building on Google's Mountain View campus. TECHNOLOGY AND THE INTERNET

>So what’s really going on here? The answer may actually be pretty simple.

>“Controlling labor costs via periodic layoffs is like breathing for Silicon Valley: cyclical, necessary for life,” Malcolm Harris, author of the forthcoming book “Palo Alto: A History of California, Capitalism and the World,” told me. The layoffs, Harris says, have “very little to do with long- or even medium-term strategy except as it pertains to cultivating an insecure workforce.”

>That tracks with the economic reality we do face today, as a tech CEO might put it. Because while a recession has not yet arrived in any meaningful form, there is another economic indicator pointing to the desirability of layoffs, from a large employer’s perspective: a growing effort to organize tech workers in an unusually tight labor market.

>Tech employees’ salaries have skyrocketed over the last two years, and their bargaining power has begun to grow too. Over the last half-decade, workers in the tech industry have agitated for changes that executives have found increasingly inconvenient.

>At Google, they’ve spoken up against gender inequalities and pressured the company to drop a lucrative defense contract. At Amazon and Microsoft, they’ve protested lackluster climate policies and spurred those companies to make pledges to reduce carbon emissions. At Facebook and Twitter, workers rallied against content moderation decisions around keeping former President Trump on the platform after Jan. 6, 2021. A subset of Google employees formed the Alphabet Workers Union with the Communication Workers of America union, Amazonians founded the Amazon Employees for Climate Justice, and at Microsoft, employees at a video game subsidiary, ZeniMax, formed the first certified union ever to be recognized by the company.

>The concrete gains won by organizing tech workers so far may be relatively small, but the rising salaries and growing organizing capacity threaten the tech giants’ bottom line and the brand of executive sovereignty that’s prized in Silicon Valley. Elon Musk’s mass firings at Twitter last year, and his public demand that only “hardcore” coders dedicated to his program remain at the company, are instructive here, not least because other tech executives have said his approach was an inspiration when culling jobs at their own companies.

> Twitter headquarters is shown in San Francisco, Friday, Oct. 28, 2022. Elon Musk has taken control of Twitter after a protracted legal battle and months of uncertainty. The question now is what the billionaire Tesla CEO will actually do with the social media platform.(AP Photo/Jeff Chiu) BUSINESS

>Workers in an industry that had long been famously union-agnostic at best had been forming bonds, organizing and developing solidarity. Layoffs of this scale and suddenness can be a blow to that process.

>Affected tech workers told me that they were struck by the randomness of the firings; senior members of staff in good standing, brilliant colleagues with sterling performance reviews, all shown the door, with little rhyme or reason. Many seemed to wonder why they were spared while their peers weren’t.

>Alejandra Beatty, a technical program manager at Alphabet subsidiary Verily, told me it was “very much a surprise” when she was laid off this month. For one thing, she had known herself to be in good standing at the company. “I was high performance, considered one of the pillars of the local community in the Boulder, Colo., office. Now I’m not even allowed to go back in, not even as a visitor,” she said. Beatty was also struck by how many of those let go were performing functions crucial to keeping “core products” working.

>If there’s one thing that firing people in a large-scale and seemingly random way accomplishes, it’s instilling a sense of precarity, even fear, in those who remain.

>“It’s completely devastating,” said Skylar Hinnant, a senior quality assurance tester at Microsoft’s ZeniMax subsidiary, “both to the people who are laid off and their families, and their colleagues, who felt, for that day and will feel it a long time after, that they’re at risk.”

>Hinnant said he knew plenty of people who lost their jobs across Microsoft — everyone does. “You can be the most important engineer at your job, you can be an awesome programmer, at the end of the day if the algorithm wants you gone you’re gone.”

> In this Sept. 24, 2019, file photo, a woman walks below a Google sign on the campus in Mountain View, Calif. Google is in the crosshairs of U.S. antitrust regulators who accuse it of wrongdoing similar to charges Microsoft faced 22 years ago, when Google was starting out in a Silicon Valley garage. How Google grew from its idealistic roots into what regulators describe as a cutthroat behemoth is a story shaped by unbridled ambition, savvy decision making, technology’s networking effects, lax regulatory oversight and the pressure to pump up profits. (

>“I think it’s waking people up to some realities of what the industry is really like,” Alejandra Beatty said. “We are workers. Even though we have benefits and we are highly trained — we’re still workers. We can still arbitrarily lose our jobs like anyone else.”

>Beatty had been a visible member of the AWU, advocating in media interviews for reproductive rights in the workplace. She was always civil and constructive, she says, and felt her suggestions had been well-received by management. Now she thinks a lot about whether her termination was retaliatory. Ultimately, she decided the layoffs were too large, too automated to have targeted her directly. “I think I was yet another number in whatever crazy algorithm the consulting company used to figure out the cuts,” she said.

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Yep, that article just about nails it. I believe by laying off a quarter million workers they've created their own recession. So in six to nine months when the lack of consumer spending hits and the west coast of the US has negative growth they will say "see! We were right!"

A great argument about why not just unions, but strong unions are necessary. If that's not on the cards then government needs to step in and break up these behemoths. Actually, both needs to happen.

This is all it is about.

How Big Tech is using mass layoffs the media to bring workers to heel.

There have been like 80,000 layoffs, that is nothing. There are 10 million job openings right now. The media is hyping layoffs to make it seem like workers are at risk.

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Lol, I’m just laughing at everyone that seemed to think these corporations were better than any others. Welcome to the real world!

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You sir are the hero we needed.

The media has really been pushing the corporate agenda hard and it's embarrassingly transparent.

Unions might help but I honestly dont know how this will play out.

They arent exactly workers in the traditional sense.

"As in you unionize? Fuck it I'll just hire someone from India or Estonia to do your job. Still want to unionize?" Then throw in the typical "I'll make sure you will never work in this town ever again!" except instead of town, they might say something like industry because of how irrelevant location is.

There might be some over-analysis here.

According to other articles Microsoft hired 50000 people during the pandemic, versus the 10000 being terminated. Now I don't know how many of the 50000 were replacements as opposed to new positions, but even the article acknowledges that there has been lots of hiring and this might just be a correction: "...after profligate pandemic hiring sprees..."

The whole objective here is to create a recession. That is how this administration is going to tackle inflation. It's about the only card left to play. You need desperate workers with little cash to drive wages down and thus costs and thus cost of goods.

It would not surprise me if the powers that be in government have gotten in cahoots with the powers that be in industry and said, "Hey, now would be a good time to start trimming some fat from your payrolls."

220,000 in the last year. A significant chunk of it in the last 2 months.

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There is also the coming commercial real estate crisis that’s looming.

It is literally stated in the LA Times article: > This follows 2022’s bloodbath, when tens of thousands of jobs were lost at Meta Platforms, Twitter and Salesforce. According to an industry layoff tracker, the tech sector has eliminated some 220,000 jobs since the start of last year. If the laid-off tech workers formed a city, it’d be one of the most populous in the United States, bigger than Des Moines or Salt Lake City.

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>It would not surprise me if the powers that be in government have gotten in cahoots with the powers that be in industry

This is just now occurring to you?

> In Silicon Valley, the new year began as the last one ended — with tens of thousands of tech workers losing their jobs. Just a few days into 2023, Amazon Chief Executive Andrew Jassy announced that there would be 18,000 layoffs across the company. Within weeks, Microsoft revealed it was slashing its head count by 10,000 and Google said that it was terminating 12,000 employees. IBM looks to be next, with nearly 4,000 workers on the chopping block.

3 of those 4 companies are not Silicon Valley companies.

That tracker lists Carvana and Capital One as tech companies.

We can see that if you merely class every company doing anything as a tech company then "tech" is laying off a lot.

The very idea that Microsoft, Amazon and Carvana are colluding to bring anyone to heel is ridiculous.

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The current democratic government literally stepped in to crush a union.

Social Media is only amplifying the message. So many tech subs are parroting the same buzz words we see in headlines.

Meanwhile the comments are mostly "glad im safe" and "my employer has plenty of openings still"

Recession to the wealthy just means everything is on sale. They can't make as much money with slow and steady growth. They want to buy on the dip they engineered.

Agree, it's not as if this hasn't likely happened before.

I’m a dev and I won’t join a union. Two years is the maximum I would work at a company - big Google or tiny startup, on average it is 2 years per company (for me). It is quite common in the tech industry. I don’t want to be bound by salary ceiling based on seniority, like so many other unions work. I don’t want to pay union dues. There probably other reasons as well. Like heck, if you got canned, really what seems to be problem here? There are lots of job for techies out there. It probably won’t as much as Google did, but that’s fine, still it ain’t like there aren’t jobs out there.

There is a flaw in that statement. If an employer could hire someone from India or Estonia they would have already done it to save money. The working class hold all the cards but are too disorganized and misinformed to use them.

Laughs in LLC. They only make people regroup into their own power house that costs less and creates more.

It’s so concerning all the stuff I read to stay up to date with the world, then once in a while I’ll see something not just in my industry but where you work that feels so totally disconnected from reality you can’t help but wonder how much of this well meaning, but just plain wrong stuff I’m reading is.

There was so much staff just for hiring in the growth times it was ridiculous. No kidding that wasn’t going to last.

These companies are always placing risky side bets to grow different business that of course are going to get looked at when things aren’t growing at 50%. Those people I feel legit sorry for, but it’s a small percentage overall, so you got to put it into perspective.

It takes years to get good at this stuff and learn these systems. What is not talked about is sometimes the people that get hit in these things are the one who let their skill set go, or try to hide in the system via transfers, or maybe just got burnt out as the pace is intense.

At no time do I feel brought to heel. We’re adults, hey the freewheeling time is over for awhile we need to buckle down. Anyone who has been in the Industry for awhile knows these cycles happen every five years or so. The good times will be back sooner or later and no need to be high drama. The world is not getting less technical.

I would prefer if they bring me to Nike or Skechers instead, to be honest.

Just remember, when your boss tells you "the grass isn't greener on the other side, it's always the same" just think to yourself - "is this the industry I want my career to be in?"

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Form a guild. Fight back.

Did not read it. they are trying to induce market crash

Europe is hiring tech.

It is not the government but the feds and yes the literally said that they want to increase the unemployment rate to fight inflation

It's about capital allocation and using record profits to make leveraged corporate buybacks while there's a volatile market. Now interest rates are up and bills are due.

Didn’t IBM just publish some bullshit about how laying people off wasn’t the IBM way?

Which is really goddamn shitty.

It's just clickbait. Look at a chart of total tech employment over the last 10 years. There's a huge surge especially from 2015->2022. Then there's a small drop. Employment levels are still higher than they were at the start of 2020 in tech despite the total USA workforce having shrunk by hundreds of thousands of workers in the same period of time.

12ft.io/add-paywalled-url-here

Goes back to Reagan...

Welp...

Traditionally tech always seemed like a safe harbor compared to other industries. Its also a sign of recession when the tech bubble pops, if late 90s/2000s are anything to go by.

It always does

To be followed by the great student loan debt default. The student loan asset backed securities scam makes home loan asset backed securities scam of the early 2000s look like a walk in the park

I also think its meant to be a strike against the push for full time work from home.

This reads like someone really trying to get somewhere but they have nothing to work with. Big tech has been irresponsibly over-hiring with impunity for years. That is unsustainable.

As someone who has worked in multiple big tech companies, I’ve seen multitudes of managers come in with the goal of growing their teams as a means of padding by their resumes. These teams will be vastly over-provisioned with dismal output proportional to their team size. The manager will leave the team while claiming a win for himself but really just putting ButtsInSeats and junior/mid career workers with far too little work on their plate.

Anyone with insider familiarity in big tech that is surprised by layoffs is living in a dream.

I was laid off, once. In the 2 years prior, I was fortunate enough to live so below my means that when layoff came around I could say, "when I said this quality of life or fuck off, I fucking meant it; fuck off with that bullshit" and it not lead to a life of destitution. For those not so lucky, my condolences. I have faith you'll make it, all the same. <3 As asshole-ish as it may seem in such a time, try to use it as a learning experience (as recently got Reddit airtime). You really can only depend on yourself.

It gives them a pass to hire for less and retain others who are underpaid and unhappy. They don't need a recession to drive down employment costs, they just need to make people afraid to leave, and willing to accept less for the same job.

NGL, commenting “paywalled” in an article about mass layoffs is quite meta.

Some level of unemployment is the only way capitalism works.

Well it’s either that or cut government spending by massive amounts.

Inb4 raise taxes…look at tax revenues as a percentage of gdp over the last 80 years

> India or Estonia they would have already done it to save money.

Well there’s a reason why firms are engaging in more aggressive offshoring.

There’s also a point where if you need a remote job done and an American wants 2x the salary of a European to do the job….and way more than that of an Indian well it makes sense just to hire multiple people overseas even if you lose some of the benefits of having them onshore.

And how do unions prevent layoffs?

Lol at 1/4 the salary before taxes

But you’ll be in Europe, … like all the time!! … It’s like vacay work!!

Here is the non-paywalled version

https://12ft.io/proxy?q=https%3A%2F%2Fwww.latimes.com%2Fbusiness%2Ftechnology%2Fstory%2F2023-01-30%2Fcolumn-how-big-tech-is-using-mass-layoffs-to-bring-workers-to-heel%3Futm_source%3Dreddit.com

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Blah blah we bounce right fucking back. Fuck you management in bIg TeCh

There is also something to be said to hold onto good workers if you think you will need them in the near future. Treating highly skilled workers like seasonable mall Santas is not good either.

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They're also trying to compete with AWS and a number of other cloud services - they would have been hiring a lot regardless

Low interest rates mean high corporate profits. Fed is steadily increasing interest rates. Fed said they need to see higher unemployment before they will start to consider lowering interest rates. Welp, here ya go.

Fear mongering. Still a very competitive system compared to the rest of the world.

This is pure conspiracy theory bullshit. Yes, the fed's mandate is to control inflation. They do that by raising rates. Rates were probably unhealthily low if anything. That might cause a recession, but that's not the goal.

Layoffs are happening because dumb fucks on wall street and the VCs in the valley are predicting a recession that may or may not actually happen. They therefore want to see blood in the water to know these companies are serious about treating their feelings seriously, despite companies like Google being ridiculously profitable. These companies should just start paying dividends and put an end to this infinite growth, short term quarterly thinking bullshit that has them laying off thousands of workers despite historically good numbers.

With the current stats in the market there’s never been a recession though.

Unions can’t force employers to keep members employed, if they downsize, reorganize or need to cut headcount a union can’t stop that.

Oh Belvedere! Come Here... Boy

The expected “infinite growth” model has always given me a good chuckle. I worked for a few people who I considered to be pretty damn intelligent. This was almost a creed for them. So fuckin stupid

I don’t think greed is going anywhere anytime soon unfortunately

Pretty much, though as someone who has worked in tech since 2006 I'm seeing something different now: lots of foreign contractors.

We've always had a big cohort of talent in India working alongside us as longtime employees but now I'm also seeing a ton of contractors from places like Brazil, Argentina, Poland, Mexico, etc.

At my company we're told this is our new way of doing business which means reduced US hiring for the extended future. A bunch of my US peers are experiencing the same thing.

Contractors are taking roles in analytics, UX, project management, change management, media production and some product management roles. Development is mostly staying in India.

My manager said the business English proficiency of foreign contractors has vastly improved in the last decade and the company is going to be saving a ton of money.

I dunno. From my lowly position it seems the winds of change are picking up.

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Honestly, these jobs are likely paying far more than 2x Europeans. Tech salaries in America are at least 2x Canada, they can often be 3-4x many European countries. When you include stock grants, perks, etc, these are damn expensive employees.

How many of those jobs can match the salaries that these tech companies had? Tech hiring largely froze last summer. Sure, developers will find other jobs, but there are many people who will struggle to replicate what they had.

Stock prices have been decimated. Lowering staffing can increase earnings per share can increase stock price.

My whole job is screening and hiring, my employer often works with some of the best known blue chip tech companies in the world, and this totally jives with the patterns I've personally observed around working in and around the tech sector. As a whole, it's really hard for me to see what's happening right now as anything other than a protracted attempt to stop long-term wage growth and reduce salaries, primarily by opening certain fields to outsourcing and cheaper immigrant workers—i.e., H1B visa abuse, etc.

They aren't done yet.

The fed's mandate is to control inflation. If they don't get it sorted by election time, it's going to bite them in the ass. They are going to use every trick in the book to try and sort it out.

Raising rates is one that they have direct control over. And the Federal Reserve says that raising rates may lead to unemployment.

>The president of the Federal Reserve Bank of Boston said earlier Monday
that the Federal Reserve will have to keep increasing the interest rate
to get inflation down but that would also mean a rise in unemployment.
And as the Federal Reserve does plan to continue the interest rate
hikes, experts project that the national unemployment rate will rise
from 3.7 percent currently, to a median of 4.4 percent next year.

Directly or indirectly, the government is going to remove money supply from the economy by taking away jobs and making people accept low pay again out of desperation.

Was entry level when the dot com crash happened. For 6 months I couldn't find a job. Everyone was saying that in the future every single software job was going to be in India. Why have it anywhere else? Everyone drew lines parallel in it to the manufacturing industry and pointed out that everything is made in China now. I was convinced I was going to have to switch careers and that software in the US was dead. And then it wasn't, and then I ended up making more money than I ever thought I would make.

It turned out all those stories about every single tech job going to India were wrong. Now I'm hearing all the same people say all the same stuff again. I'm skeptical this time around.

It is and it isn't, since it wasn't the new hires that got fired exclusively.

The correction is happening in the market. During the Trump era companies converted tax money into buy-backs, and did other things that inflated the price with no real growth to back it. But everyone did it, and the interest rate was low, so investors felt ballsy and went with it. In 2020 it got even worse, and a recession hit everything, except the market, because everyone was doing it, and the interest was low so investors felt ballsy and went with it.

Then in 2021 the economy lurched again, and things started moving. The interest rates were low and the investors felt ballsy, so the market stayed waaaay overinflated. But investors refused to believe it was their fault. The market reacted by, rather than lowering the market, making everything more expensive until the market was effectively cheaper. But it couldn't be the investors fault, so people assumed that supply was limited due to issues with the distribution. But as distribution and supply improved, the inflation kept, but it couldn't be the investors. But something had to be done, and so interest rates went up. When interests rates went up, investors weren't able to leverage their investment against loans as effectively, so they started feeling less ballsy, their coke waning, and so they started selling, which lead to a snowball effect. The investors couldn't have done anything wrong, so it couldn't be a market only correction "the recession is coming" said Chicken Investor and everyone said the same. The prices kept falling, but the rest of the economy was doing just fine.

Now investors don't use economic models, that is they are not based on theory and science to be proven to actually describe the way things work. Instead they use financial models, which play it a bit more loose and are more of general guides on how the economy works. So we have a model where companies decide how much of a company's valuation is real and how much speculative. That is if you buy a $100 stock, it may be that if the company folded right there and then you'd get, at most, $80, and the other $20 were bets on the future (that didn't pay off). They use a model that goes backwards, they look at the revenue and profits the company makes, they look at the capital they have, the number of employees, etc. and from it create a base valuation. When the stock price is higher than valuation, that means there's speculation, how much investors are willing to do depends on how ballsy they feel. When the stock price is at-price it's considered "a safe bet" basically a good place to put your money that will have some returns and is good as a backup. When the stock is worth less than the minimum valuation, people assume that the company is imploding, losing value and worth getting pennies on the dollar, and therefore will be worth even less in the future. When the economy is doing well this model is very good, it basically is about company size vs how people feel about betting on it, a clash between reality and observation. But it doesn't capture all cases. Like using a barometer to find out how high above sea-level a boat is and realizing that if it lowers that means the boat is sinking, unless it's just the tide going down. Same here, the model doesn't capture cases where there's a large market correction, and it really doesn't work well in these cases. But that would be admitting that the investors got greedy, and the investors did not do a mistake, it must be the employees that got it wrong!

And so companies do layoffs. There will be those that try to make excuses, to say this is a solution to a real problem, which is absurd because there isn't. They will say that the companies over-hired and are losing money for it. But the profits and information doesn't show that at all. The companies did over-hire, and therefore should set a period of internal-optimization with low-hiring rates, and a focus on performance and project analysis. So by the time the market stabilizes and the correction is over, the companies would find themselves roughly where they should be. The need for mass-layoffs is only to keep investors happy with their arcane (at least to them, many don't seem to understand the logic behind them) models. But of course, this would mean that it's the investors who are being too greedy, and they can't be wrong. The thing is this won't prevent the hit to investors for the next quarters. It doesn't mean that investors won't get their money, we were just 4 months ahead of schedule. This is like getting your May paycheck deposited on February by accident and then withdrawn. It just isn't their money yet but it will get to them. But the investors can't be wrong or impatient in their greed. People will argue "lowering the amount of employees will result in lower prices", except, of course, we already had very low levels of unemployment way before COVID, and inflation wasn't hitting hard. Sure there was overhiring in 2020, but this itself was a symptom of over-valued companies, no the source of the problem. And even then inflation was driven a lot by companies demand, based on their high prices. As long as companies are not reducing their demand on products and services, we won't see this go down. The other thing is that employee expenses are pretty small compared to other day-to-day sources of costs, yet we are not seeing a rush to cut on those down (because those actually harm the company's profit in the short-term). That is, once you look at the bottom-lines, the same problem of limited profit growth (while revenue has been booming) is still there. The reality is simple: you hold the boat, keep it slow, and rake in the huge increases in profit from just internal optimization.

Companies are not really making an effort to reduce the impact on the long-term, and this solution won't quite make it work. Markets reach equilibrium really well, but they can do this in all sorts of fashion, and will destroy everything in their path. But hey, the investors do not get greedy, and this isn't their mistake. Somehow it's all for us right? Either way, at least I can say this (being one of the many people laid off) this too shall pass. It's just the flow of things.

Yes corporate America can’t possibly have workers feeling like human beings again, best to manipulate everything in the US economy so that the human cattle return to their cubicles broken and submissive.

not in location but in mindset lol

I guess. But the article veers from that too. It counts Capital One and Carvana as tech. And I only got down to the Cs to see those!

Honestly it looks like the article is just bundling up nearly any company that uses computers in their business and laid off as "tech" (or Silicon Valley in that paragraph).

Carvana puts thousands of car salesmen on the street because the leadership can't figure out how to properly track car titles and it's part of a "tech layoff trend to bring workers to heel".

BTW, a friend's actual Silicon Valley, actual tech (and I don't mean selling mattresses over the internet) company laid off today. About 3.5% of headcount. So there is something there. I just think it's being massively misrepresented here.