What Led To Mass Layoffs In Tech Sector Globally And Who Was Affected?
Illustration: Binay Sinha
Listen to This Article
The latter half of 2022 and the beginning of 2023 has been tough for people working in the tech sector globally as many companies resorted to mass layoffs amid concerns about recession. These mass layoffs came after a hiring spree was witnessed by these tech giants during the pandemic.
According to a recent report by 365datascience, over 150,000 people have been affected by tech layoffs in 2022 alone, whereas, 68,500 new cuts were seen in January 2023 alone.
The distribution of these layoffs at Twitter, Amazon, Google, and Microsoft is very similar. While the HR department took the biggest hit at Meta, Amazon, and Microsoft, the software engineer position was the most affected one at Twitter and Google, shows the report.
The report suggested that nearly half of the laid-off workers belonged to the age group of 30-40 years and had an average work experience of 11.9 years. The second most affected group, nearly 36 per cent was between 20-30. Even though women made up a small proportion of the tech workforce, more than half of those laid-off are women, further widening the gender gap.
Possible factors driving layoffs
According to a
Times of Indiareport, a drop in stock price, economic fears, and declining sales were cited as the reason for downsizing by software firms.
Another factor that could have added fuel to these layoffs is that the focus of many tech companies is now gradually shifting towards Artificial Intelligence (AI) and automation.
After OpenAI launched its chatbot ChatGPT, Google announced its AI tool BARD and Microsoft launched Bing. Even though these companies have not explicitly opened up about reducing payroll costs to allocate funds toward the building and development of AI tools, there is speculation regarding the same.
JPMorgan Deploys AI Chatbot To Revolutionize Research And Productivity
JPMorgan has deployed an AI-based research analyst chatbot to enhance productivity among its workforce, with approximate... Read more
Private Equity And Banks: The Complex Web Of Leverage
Private equity has emerged as a significant force in the global financial landscape, driving substantial growth and inve... Read more
Financial Watchdog Highlights Unresolved Vulnerabilities In Shadow Banking Sector
The world’s leading financial stability watchdog has issued a warning about the unresolved vulnerabilities within the ... Read more
JPMorgan And Small Caps Lead Market Rally: A Sign Of Economic Optimism
In a week marked by strong financial performance, JPMorgan Chase & Co. reported a 25% rise in profits, and US small-... Read more
Big Banks Vs. Regional Banks: The Battle For Market Share
The financial industry is a competitive landscape where big banks and regional banks vie for market share. Each type of ... Read more
The Evolution Of Philanthropic Advisory Services In Private Banks
The landscape of philanthropic advisory services provided by private banks has undergone a significant transformation. T... Read more