Around 74 major tech companies laid off over 15,000 workers in February. Let’s understand the potential reason behind job cuts.
The tech industry is facing money problems. Companies like Sony, Bumble, Snap, SAP, Cisco, others are trying to save money by cutting jobs.
The reason behind this mass layoff can be:
- The economy is not stable, and
- Businesses are changing their goals quickly.
Companies need to adapt to new technology and market conditions to stay competitive. This means they sometimes have to make big changes, like cutting jobs. As a result, many workers feel uncertain about their jobs. Others reasons of this major layoff can be:-
Economic Uncertainty and stock market declines lead to cost-cutting measures, including layoffs. Cisco plans to lay off 4,250 employees due to uncertain business conditions and slow demand.
Change in Goal Many companies globally, including SAP and Expedia, are restructuring to align with new priorities, resulting in significant job cuts.
Overstaffing after Pandemic Many tech companies, like Amazon and Meta, hired excessively during the pandemic due to high demand, but later found the surplus staff unnecessary amid changing economic conditions, leading to layoffs.
Investors Push for efficiency post-pandemic, leading companies to cut costs. Job cuts are widespread as firms seek to meet investor demands and improve effectiveness.
Rise of AI and Automation are replacing human tasks. Although not explicitly stated by all companies, the impact on layoffs, especially in repetitive tasks, is evident. While February’s AI-related layoffs were small, it signals a growing trend for the future.
To learn more WHY THESE TECH LAYOFFS ARE HAPPENING, watch this YouTube video by CNBC.
