We saw many tech companies partake in mass layoffs in 2022, leaving many individuals with the challenge of unemployment. Unfortunately, tech layoffs have continued into 2023, all the way through the final month of the year. Due to overhiring during the COVID-19 pandemic as well as economic uncertainties and shifts in market demands, businesses big and small were forced to reevaluate their workforce structures. Many talented individuals now find themselves unexpectedly navigating the job market.
According to tech layoff tracker Layoffs.fyi, 1,169 companies have laid off 260,238 employees in 2023. This is a significantly higher amount than in 2022, which saw a layoff of 164,969 employees. We cannot help but wonder, will these tech layoffs continue in 2024? Read on to learn more about the companies that have had to lay off employees in 2023, in addition to predictions for 2024.
Big Tech Layoffs
In 2023, some of the largest tech companies faced the harsh reality of economic challenges, causing them to implement substantial layoffs. These industry titans found themselves compelled to reassess their organizational structures in response to changing market dynamics, emerging technologies, and global uncertainties. The layoffs, unprecedented in scale, affected thousands of employees across various departments.
These companies include Salesforce, Amazon, Meta, and Microsoft, among many others. Let’s look at the number of layoffs for these tech giants:
Salesforce: Back in January, Salesforce announced that it was cutting 10% of its workforce, impacting over 7,000 employees. There were many employees that were not aware that they were part of the layoff, only finding out over a month later.
Amazon: Amazon cut more than 18,000 jobs in January. A few months later, the company announced that its Halo Health Division was being shut down, bringing the total layoffs to 27,000, 8% of its corporate workforce. In addition, last month saw a cut of 180 roles in the company’s gaming division, as well as several hundred in their Alexa division.
Meta: This tech giant announced its laying off of 6,000 employees in May. Since November 2022, about 21,000 individuals have lost their jobs at Meta.
Microsoft: At the start of the year, Microsoft announced layoffs of over 10,000 employees. In March, they laid off a team dedicated to guiding AI innovation that leads to ethical and sustainable outcomes. Later that month, the company laid off 559 workers from its Bellevue and Redmond operations.
With many companies still laying off workers with so little time until 2024, it seems the year will end as it began. Here are a few of the leading companies that have made cuts in December:
Etsy: On December 13, the company’s CEO announced that they would be laying off 225 workers, which amounts to about 11% of its workforce. This was cited as due to “a very challenging macro and competitive environment” which led to a need for cost cutting.
Spotify: Music streaming company Spotify announced 1,500 layoffs early this month, which is about 17% of its workforce. This was the third round of layoffs for Spotify in 2023, and the reason was cited as slowing economic growth.
Course Hero: The online learning platform laid off over 20 of its employees this month, following cuts earlier this year of 42 people which, at the time, was 15% of its workforce.
Predictions for 2024
The large amount of layoffs in 2023 is reasonably leading to concerns for what 2024 might bring. According to experts consulted by The San Francisco Standard, it is predicted that the majority of mass layoffs are over, as long as the rate of hiring returns to normal levels. The correction of the overhiring that we saw during the pandemic may continue into early next year, however these layoffs will likely not be as substantial as they were in the start of 2023.
The optimism from these experts follows the Federal Reserve announcing that it would hold interest rates steady for the third straight time, and would likely cut rates at least three times in 2024. These are positive indicators that companies may be more likely to post new jobs next year after being reluctant to hire in 2023. Tech workers will remain high in demand, but hiring in the tech industry will be a lot more sustained to prevent the overhiring seen in the pandemic era from happening again.
This period of significant workforce reduction highlighted the vulnerability of even the biggest names in the tech sector and highlights the importance of adaptability and strategic planning in the ever-evolving tech landscape.
Are you looking to get back into the tech industry? Hoping to break into tech in an entry-level position? Does your company or organization have a tech project they could use our expertise in implementing? Sedna Consulting Group has over 15 years of experience in helping talented individuals find positions that suit their needs and expectations. Send us a message on LinkedIn or Instagram if you would like to begin working with us to find your next career.