November was a particularly brutal month for employees, going from the Summer months, where about ~40,000 layoffs had accumulated, to the beginning of November, where 90,000 people were rapidly laid off from large companies like Amazon, Meta, and Twitter. To make matters worse CEOs have acknowledged tough times ahead, with Andy Jassy, the CEO of Amazon, even saying he expects more layoffs in the new year.
After a decade of rapid growth, the tech industry is facing a significant slowdown. A recent report from Gartner predicts that worldwide IT spending will decline by 7.6 percent in 2020 and another 5.5 percent in 2021. Of course, the pandemic has been a major factor in the slowdown, as businesses have cut back on spending, and many consumers have shifted to cheaper alternatives. But the slowdown was already underway before the pandemic hit, and layoffs will likely continue even after the economy rebounds. Gartner estimates that global IT employment will decline by 2 percent in 2022, with the most significant job losses occurring in North America and Western Europe.
It’s no secret that the pandemic has been hard on the economy. As a result, many businesses have been forced to close their doors, and millions of Americans are out of work. The tech industry has been hit particularly hard as businesses have postponed or canceled projects, and consumers are expected to slow spending. As a result, many tech companies face financial difficulties and are forced to make cuts. One way they are doing this is by laying off employees. Startups have to lead the layoffs, with companies like Robinhood and Carvana cutting thousands of employees simultaneously.
Will there be more layoffs in 2022?
Yes, there will likely be more layoffs through 2022, investor sentiment has changed substantially since the end of 2021, and tech companies will face continued scrutiny from investors. This pullback will be hardest on smaller companies or those with smaller cash flows, significantly if the economy slows down or worsens.
List of US companies or notable tech startups that have laid-off more than 75 workers in 2022 so far:
1. Robinhood
9% of full-time employees, 340 jobs were cut 4-26-2022
2. Better.com (maybe the most notorious with mass live Zoom firing)
3 waves of layoffs amounting to 3,000 employees in the US and more than 20% of their company. At the end of last year, just before the holidays, they fired 900 employees in Germany.
3. Reef
laid off 750 employees or 5% of its staff to focus on profitability on 5-6-2022
10K laid off in November, expects more in the new year, underlying businesses are fine
40. Meta
Laid off 10K in November, company is still off track and investor sentiment has soured
If you want to see a detailed list of layoffs, updated continuously since the beginning of COVID https://layoffs.fyi/ is a great resource. Roger Lee is the creator of this @roger_lee on Twitter and it has been invaluable to tech reporting.
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