“Copycat” layoffs won’t help tech companies or their employees
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“Copycat” layoffs won’t help tech companies or their employees
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Re: “Copycat” layoffs won’t help tech companies or their employees
#2This just seems wrong to me. Productivity at the FAANGs was low pre-covid and tanked further when they tried to grow rapidly during COVID. Thanos snapping a significant portion of your workforce is probably the best way to get some level of productivity back.
Ideally, you would carefully evaluate everything and trim the fat. But that's probably not possible and if it were it'd play out over a year or two which is worse than ripping off the band-aid. So you make the cuts and expect/hope that people will get reallocated to the most important things and productivity will go up.
Re: “Copycat” layoffs won’t help tech companies or their employees
#3I always wondered if high profile CEOs and shareholders know something substantial of the upcoming future that us leaf nodes are just clueless about. Is it just copy cat or deep info for privileged clubs?
Re: “Copycat” layoffs won’t help tech companies or their employees
#4I love this point: "The tech industry layoffs are basically an instance of social contagion, in which companies imitate what others are doing."
I really wish for a less supine tech press. I've not seen any of these titans of industry being held accountable for the apparent major mistakes of overhiring. And I'm not even talking actual consequences here; these people will surely get bonuses for this. I'd just like to see some hard questions being asked and answered.
Re: “Copycat” layoffs won’t help tech companies or their employees
#5I always wondered if high profile CEOs and shareholders know something substantial of the upcoming future that us leaf nodes are just clueless about. Is it just copy cat or deep info for privileged clubs?
The plebes want more share of the pie, the fed and elites want more unemployment. Is this a consequence of raising rates, or is it in pursuit of more unemployment?
Re: “Copycat” layoffs won’t help tech companies or their employees
#6I always wondered if high profile CEOs and shareholders know something substantial of the upcoming future that us leaf nodes are just clueless about. Is it just copy cat or deep info for privileged clubs?
> Everybody else is doing it, why aren’t we?
Pretty much just that. This is how big companies decide most things, not only layoffs.
Re: “Copycat” layoffs won’t help tech companies or their employees
#7This misses the main driver. Valuations are no longer based on growth. The entire market has shifted to profitability over growth.
Companies with a stronger balance sheet coming out of the recession will be better positioned for the long term.
Seems that companies that gained their valuations through growth weren't sustainable in the long run.
And at a macro level, economic policy has largely deferred recessions since the 2008 housing bubble pop. That's not sustainable either. At some point a correction is going to happen.
The "social contagion" is companies betting that a correction is coming. Some made that bet early, and some are just now hopping on the train.
It's about survival for many companies. I bet we'll see fire sales, and acquisitions ramping up for the financially stronger companies.
Re: “Copycat” layoffs won’t help tech companies or their employees
#8Not all of it is "copycat". During the pandemic consumer spending moved online. People purchased hardware to work from home, ordered more from Amazon and other online stores as opposed to physical stores, used online services such as Zoom and Microsoft Teams more. Tech companies responded to the increased demand by increasing the pace of hiring. Were they wrong to do so? Possibly, because they should have expected that not all of the increased demand would stick around once the pandemic is over. As it happened, the demand ebbed when the pandemic was over, so they are stuck with excess manpower, which now has to be reduced. This doesn't explain all layoffs, however. Some of it is just opportunistic - now is a good time to do layoffs without looking weak.
Re: “Copycat” layoffs won’t help tech companies or their employees
#9This just seems wrong to me. Productivity at the FAANGs was low pre-covid and tanked further when they tried to grow rapidly during COVID. Thanos snapping a significant portion of your workforce is probably the best way to get some level of productivity back. Ideally, you would carefully evaluate everything and trim the fat. But that's probably not possible and if it were it'd play out over a year or two which is wor…
I understand you feel that way. And clearly, that's the dominant narrative about layoffs. What makes you value those feelings enough to reject out of hand a professor who has been studying it for decades?
Re: “Copycat” layoffs won’t help tech companies or their employees
#10This just seems wrong to me. Productivity at the FAANGs was low pre-covid and tanked further when they tried to grow rapidly during COVID. Thanos snapping a significant portion of your workforce is probably the best way to get some level of productivity back. Ideally, you would carefully evaluate everything and trim the fat. But that's probably not possible and if it were it'd play out over a year or two which is wor…
> Productivity tanked further when they tried to grow rapidly during COVID
Anecdotally, the productivity went up during covid because the boundaries of WLB were shattered. But after 2 years, I think a lot of people are feeling burnt out. The companies may feel like they are just trimming the fat, but fat has an essential function in the body.
With less people, no doubt, the people who are left will initially work harder, but they will soon succumb to burn out and have a loss of productivity. Working harder after already working hard for two years can do that to you. The company’s best performers at low productivity will do more harm to the companies than having their low/average performers have low productivity.