Changing face of the tech industry25 May, 20232
Current state of the marketSignificant downsizing in the technology sector made headlines in...
Current state of the market
Significant downsizing in the technology sector made headlines in the year 2022 and this trend is anticipated to persist in 2023 as well. According to Layoffs.fyi, a data tracking platform, the number of global layoffs has surpassed 169,000 since the start of the year. This figure exceeds the total number of layoffs that occurred in 2022, which was reported to be 164,411.
This trend does not only jeopardize innovation in the sector but also presents a potential end of the era of inflated salaries. The current economic outlook , interest rates fluctuations and the ongoing impact of the pandemic on hiring practices have been identified as key contributing factors to the big layoffs.
Following the conclusion of the pandemic-induced hiring boom, several prominent technology corporations including Alphabet (12,000 employees), Amazon (18,000), Meta (11,000), Twitter (4,000), Microsoft (10,000), and Salesforce (8,000), have implemented large-scale layoffs resulting in the termination of significant numbers of employees (numbers mentioned in brackets).
How are consumers affected?
While the news of the tech layoffs may be alarming, it is unlikely to have a significant impact on the end-consumers. Despite the downsizing measures implemented by various technology companies, the development and delivery of their products and services continue to expand overall.
How does this impact the industry?
With so many professionals looking for work and employers looking to downsize, salaries are likely to deflate and job requirements might become even more stringent. This shift could lead to greater stability and predictability in the industry, ultimately resulting in a more sustainable and mature market environment. Big Tech’s reputation from an employer branding perspective is not as attractive as it used to be, job seekers being less inclined to pursue opportunities with these companies, as they are deemed less safe and secure. Its impact on the overall economy is expected to be relatively minor as this only constitutes a small fraction of the overall tech workforce.
Despite the current market situation, Big Tech companies remain major employers, and their products and services continue to have a significant impact on various aspects of our lives. These companies are often at the forefront of technological innovation, and their products shape the way we live, work, and communicate.
All in all, the instability and unpredictability of the job market in the tech industry has led to increased uncertainty for both employees and job seekers, as well as a shift in perceptions of job security. While these changes may be challenging for affected individuals, they may also contribute to a more dynamic and innovative job market, encouraging greater adaptability and resilience in the workforce.