Tech layoffs are making headlines — but the impact is much broader than many may realize. As companies scale back, they’re also recalibrating their operations, and investing billions in technologies such as AI. This juxtaposition of contraction and expansion has left workers, communities, and investors trying to make sense of what’s going on in the industry.
Large-scale tech layoffs have been a frequent feature in the news this year, with Oracle, Meta, Tesla, Robinhood, Intel, Google and more pulling back on hiring or slashing jobs. These companies’ decisions have been motivated by a variety of factors, from pandemic-era over-hiring to strategic repositioning and the race to develop generative AI.
When these decisions are made with no clear roadmap in sight, it can create a toxic culture of fear and uncertainty within an organization. People see every new hire as a potential target, and managers begin to prioritize productivity over morale. Rolling layoffs can also demoralize teams, and increase stress levels amongst current employees.
Even so, it’s important to remember that the tech job market is still booming, and most of these layoffs are happening within organizations that are still growing rapidly. Moreover, the labor market overall is cooling down, but it’s shifting from a state of overabundance to one of more sustainable balance between supply and demand. Despite this shift, job seekers are generally unwilling to relinquish their pandemic-era gains, and no subset of the workforce is holding on with as much steadfast determination as those in the technology sector.