Why Are There So Many Tech Layoffs?

Each new day has seemingly brought news of another round of layoffs, most of them coming from the tech sector. The list of companies that have made cuts includes some of the most recognizable brands in the world, companies such as Amazon, Google, Microsoft, and Meta. In fact, you could argue that Apple is the only major player in “Big Tech” to avoid layoffs up to this point.

The number of people laid off is constantly changing, making it hard to place an exact number on it. Crunchbase News estimated that as of February 24, 2023, more than “102,000 workers in U.S.-based tech companies (or tech companies with a large U.S. workforce) have been laid off in mass job cuts so far in 2023”. This number wouldn’t include the 11,000 workers laid off by Meta in November of 2022, or the 10,000 let go by Amazon in that same month.

So, what is behind these layoffs and why are they happening now? 

One of the prevailing explanations is that this is the proverbial other shoe dropping on the other side of the hiring blitzes that tech companies undertook as a result of pandemic-induced demand in 2020 and 2021. Forbes states that “major firms like Amazon and Meta doubled their headcounts in a matter of months” during the peak months of the pandemic. 

While it would be easy to fault these companies for being short-sighted, it can be easy to forget the uncertainty of those times. Many often wondered what the “new normal” would look like and how long it would be before the world resumed many of its previous activities. Now that we’re getting answers to many of these questions, tech companies are evaluating the necessity of much of the staff that they brought in during the height of the lockdown. In fact, Forbes found “that the median time a recently laid-off employee has been in their role is roughly two years”.

For hiring managers, there are two sides to this story. Yes, there is undoubtedly a pool of talented individuals who are now looking for new work. On the other hand, unemployment remains extremely low (3.4% as of the February 3rd Department of Labor news release), meaning competition for talent will be high.

If you need help finding that talent, well…you know where to find us. 

Frontline's Hot Jobs of the Week!

Staff Accountant in Frisco, TX

Hey numbers crunchers! Frontline's client has an outstanding opportunity for a Staff Accountant. They're looking for someone with 3+ years of public accounting experience and/or specific Industry experience in Aviation. Is this you? Click here to apply! 

Call Center Director in Richardson, TX

Our client in Richardson, TX is looking for a Call Center Director. This position will be responsible for offering: 1) strategic planning and execution of all Call Center operations and 2) offering management and leadership for the continuous improvement of the customer experience. Want to learn more? Check it out!

3 Engineering Positions in Houston, TX

We have a 3-pack of engineering jobs for you based out of Houston!

• Mechanical Engineer
• Mechanical Engineer II, Certification
• Industrial Engineer

All three of these jobs are excellent positions and great opportunities for the right candidate. Click the link for each job to get the full job description and to apply!

What We're Reading

1. 5 Tips to ‘Quiet Thriving’ in the Workplace - The Undercover Recruiter
2. The Most In-Demand Skills for Recruiters in 2023 - LinkedIn Talent Blog
3. Boost Employee Retention with Paid Rotational Programs - The Staffing Stream