Some of the world’s biggest tech companies announced a wave of layoffs this week, losing tens of thousands of jobs as they reversed course after years of expansion.
Google’s parent company announced on Friday that it will cut 12,000 jobs. Microsoft and Amazon cut 28,000 jobs on Wednesday. Overall, tech companies have cut more than 200,000 jobs since the summer.
But “it was largely expected,” said Alex Zukin, managing director of Wolf Research.
“I think a lot of companies are right-sizing their staff.”
He said most of the big tech companies have expanded dramatically through the pandemic. They made a big bet that people and businesses’ behavior during his COVID-restrictions in 2020 will be a permanent shift to a more online lifestyle.
Microsoft CEO Satya Nadella said in an email to employees that customers are indeed adapting to a slowing economy and trying to “optimize their digital spending to do more with less.” said there is.
Zukin says Microsoft is a perfect example of a company that expanded too quickly.
Nadella took over the company “From 60,000 employees to 220,000. So they’re cutting his 10,000, which isn’t all that surprising,” he said.
Earlier this year, Canadian tech giant Shopify made a similar calculation. During the pandemic, CEO Tobi Lütke made a big bet that e-commerce would be “5 or 10 years ahead.”
Shopify, which has doubled its headcount since early 2020, was forced to furlough 10% of its staff this summer.
“Ultimately, it was my call to make this bet, and I made a mistake with this,” he told staff in a note. No. We deeply apologize for that….for a company like ours, this news will be difficult to understand.”
Since then, the biggest names in technology have followed suit.
But economists tracking employment levels found that furloughed workers appeared to have had little trouble finding new jobs.
“By December, many tech workers who were laid off early in the economic cycle appeared to have found new jobs relatively quickly,” said Aaron Terrazas, chief economist at job-search website Glassdoor.
“Technical skill sets are incredibly valuable, whether it’s engineering or data science, and that’s why, to some extent, we’ve seen technology become a little less technical and traditional companies a little more technical. he said.
In fact, Canada’s technology sector played a leading role in job creation last month when professional, scientific and technical services companies added more than 100,000 jobs.
Still, Anurag Rana, Senior Technology Analyst at Bloomberg Intelligence, says there is currently a serious shortage of skilled tech workers in the market.
A big reason, he said, is that traditional Silicon Valley companies aren’t the only ones looking for tech talent.
“Look what happened in the US with Southwest Airlines. Their system is pretty old. They just said they were going to spend $1 billion on new technology,” Lana said in an interview this week. “So I don’t think technology trends will stop here or that spending on technology will stop forever. It’s just a temporary pause.”
Silicon Valley giants are laying off thousands of employees, while small businesses struggle to find and retain tech talent.
Jennifer Reed is the Senior Director of Talent Acquisition at Docebo, a software company headquartered in Toronto. She scours the globe for skilled workers who build software that helps companies train and develop their workforce.
“The furlough situation continues, but it’s always been competitive. There’s not enough supply to meet demand,” Reed told CBC News.
The company currently has dozens of positions open, ranging from product engineering to software development.
When one of the big companies announces layoffs of its employees, the email and text chains go wild.
Ronda Morra, Docebo’s global director of public relations, said:
That means laid-off workers have a lot of options.
Evelyn Watts was laid off from an Ottawa-based tech company in December.She’s seen this cycle unfold before
“I’ve been in tech for 20 years, so I’ve been through booms and busts. This isn’t my first layoff,” she said. But Watts knows that some workers will be new to the process.
“It can be a little confusing for first-timers, but let’s be honest, technology is always changing. Business is changing and new opportunities are always emerging.”
It may be counter-intuitive to think of this as an opportunity for the tech sector. But sectors are cyclical. And as technology permeates every aspect of our lives, the number of companies hiring tech workers is exploding.
So, even in the midst of this wave of layoffs, technology workers have more options and opportunities than in the history of the industry.