Big Tech Layoffs: The Dark Side
As 2023 enters a new period of economic recession, many who are still employed in the tech industry are worried about job security. As tech layoffs are making big news around the world, much of this news also is hiding an inconvenient truth. Understanding how tech companies approach layoffs and which jobs will be likely to be cut is simply a matter of financial survival.
How the tech industry is driven
As most financial experts will agree, global tech business is highly motivated by rising profit margins and quotas for each business quarter. Business is the backbone of nearly any industry with endless competition around every corner. Yet for the tech industry, the facets of how information technology works can easily be misinterpreted. Until recently, many tech companies sought to research these newfound trends as early as 2020.
This is when a massive splurge in new hires throughout the industry began just as the pandemic created a new niche for young employees. One of the key research tools used by tech companies was using Human Resources and Recruiting employees. While these positions are valued by tech giants, they are not nearly as essential as programming, coding, and IT-driven support positions.
And while many of these non-essential positions were highly-paid salaries for new university graduates, the financial strain from these new hires proved otherwise. Many of the largest tech companies including Meta, Twitter, Google, and Amazon saw major financial losses worth an estimated 7.4 trillion USD in 2022 as a result. This was a combination of lost ad sales and HR-related functions.
Will tech layoffs continue in 2023?
As the latest purge of positions is slowly reduced, these positions are likely to be replaced by AI technology. Artificial intelligence had been anticipated at the start of 2020 and became the testing ground for roles within tech companies to harvest this implement this information. With much of the hands-on information added to AI databases, tech giants are now resuming business as usual with impressive increases in revenue for 2023.
Sales automation services using chatbots and many other streamlining improvements are further reshaping and trimming company budgets also. Yet the biggest pitfalls for many of these companies that form the umbrella of big tech were team-driven HR projects. Once again, companies that utilized AI to assist HR teams gained an advantage to reduce excessive spending within the company for the better.
This has allowed specific companies to trim away further financial burdens which relied heavily on employee mental wellness within this sector of the tech industry. And though the role of AI strongly emulates human interaction, it may very well improve HR recruiting services as a whole. While layoffs continue throughout 2023 and beyond, this is to be expected. Larger tech giants cannot survive without using AI technology to push for essential financial gain.
And with a sigh of relief for investors who are worried about their holdings within a company, layoffs were inevitable. Perhaps this will create a new niche for the gig economy’ culture, while new waves of layoffs continue further this year.
