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Gitlab to lay off 7% of staff

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Re: Gitlab to lay off 7% of staff

#311

Post by charcircuit »

hashmap wrote: post #230
arbuge wrote: post #56

At this point it's beginning to look like tech companies are doing this because it's the trendy thing to do, along with inserting a few words about AI in their websites and pitch decks.

I don't know how this has gone over everyone's heads here, because what's happening is extremely obvious. If you're a big FAANG-like company, you've seen workers make big gains in wages over the past year, and turnover rates have been increasing significantly during the great resignation. This isn't enough to sink you, but you don't like it, because it does eat into your margins a little. Of course you're still makin…

These companies overhired and now they are realizing that the positive cash flow to justify all of these new employees isn't existing. None of these layoffs are focused on laying off their most expensive people. The severance packages have been very good meaning that the laid off employees have a long time to find another well paying job.

Re: Gitlab to lay off 7% of staff

#312

Post by grey-area »

beardedetim wrote: post #102
grey-area wrote: post #42

Earlier quoted context omitted.

This is the correct answer. The Fed rate is the main driver for these layoffs. The fed is trying to cause a slowdown in the economy (including layoffs) in order to temper inflation.

Specifically the Fed is trying to wrestle away the monetary power that Labor has, quoting a "wage-price spiral". In other words, the Fed is trying to cause a recession in order to fend off inflation, at the cost of Labors current economic power.

Yes, it's a brutal calculus, but inflation is also really corrosive for labour, since wage rises tend to take a while to respond to inflation and... cause more inflation.

They are stuck on the horns of a dilemma they created 10 years ago with 10 years of sustained QE and ZIRP, which led to the asset bubble we now see deflating.

Re: Gitlab to lay off 7% of staff

#313

Post by anon7725 »

andsoitis wrote: post #212
todd3834 wrote: post #137

Earlier quoted context omitted.

Most of them over hired like crazy during the pandemic bubble. I wouldn’t say they were stupid but collectively most of them made a massive mistake. So yeah it isn’t hard to believe for me. I don’t think the layoffs are a stupid decision but I do think the extreme over hiring as if the bubble was a new normal was. Between 2020-2022 I literally conducted over 200 interviews for my previous employer. It was like we cou…

> Between 2020-2022 I literally conducted over 200 interviews for my previous employer. it sounds like you knew at the time that it was a mistake to hire this much and you were part of the interview processes. did you ever speak up, tried to make a case that it is the wrong move?

Lmfao. Do you know how hiring works at a large company? When your management chain has won a few headcount marbles during this quarter’s game of Hungry Hungry Hippos, it’s not in your interest to blithely challenge them on it.

Re: Gitlab to lay off 7% of staff

#314

Post by [deleted] »

Merad wrote: post #196
naikrovek wrote: post #9

Are layoffs like a fashion statement, now? "Look, we're cool, too!" why is everyone doing this at the same time?

It's cargo cult corporate leadership. My company has less than 200 employees, so our layoffs weren't newsworthy, but the c-suite decide to cut 5% last week citing "trends in the industry." I can't speak for other departments but our engineering team definitely _is not_ bloated yet they still axed two positions from teams working on the highest priority projects in the company. Absurd.

[deleted]

Re: Gitlab to lay off 7% of staff

#315

Post by neilv »

I would've guessed GitLab would be unlikely to join the layoffs party right now, just on culture and internal/hiring image reasons.

Then again, I also thought Google might've been a holdout among the FAANG companies. Before, I figured someone working at Google could assume that, if they focus on the company and do great work (or focus on the perf/promo metrics/criteria that Google seems to want), that Google will take care of them.

Now, for both companies, I wonder whether, rather than lighting a fire under anyone who needs it, layoffs erode the unusual trust and intangible appeal they might've enjoyed.

(Obviously, Google will still have the selling point of paying very well (or pay OK, if RSUs and bonuses don't recover). And I suppose Leetcode interviews make more sense, if you imagine it coming from a musty old complacent Fortune 100 bureaucracy. And GitLab, though not known in the US for pay, will still hire people around the world, with transparency on at least non-layoffs things.)

Re: Gitlab to lay off 7% of staff

#316

Post by exmicrosoldier »

jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

> The current macroeconomic environment is tough

aka

> Interest rates are high and I am worried about getting my next round of funding or meeting minimum payments on corporate debt.

Because an overwhelming number of corporations take advantage of tax laws that make interest debt deductible, every interest rate hike leads to firing people and decreasing business investment, just to stay profit margin neutral.

If you want to change this, it would really help to change the tax laws. https://news.bloombergtax.com/tax-insights-and-commentary/en...

Re: Gitlab to lay off 7% of staff

#317

Post by tukantje »

Gustomaximus wrote: post #192

From an investor POV are layoffs an indicator that companies management feel they dont have growth prospects? Companies, especially tech companies would rarely admit this openly, e.g. how they typically hold ever growing cash rather than pay dividends. Logically you would think now would be a great time to hire if you genuinely saw significant grow/product rollouts coming. Especially if a company is making profit and…

In this context it is a sign they bend their knees and kiss the ring.

Shareholders have been feeling that the tech workers held too much power, and companies were openly / not-so-openly having a fight with their shareholders, so to speak (especially in cases like Meta).

With the new blood sacrifices, shareholders can rest assured that their profit > everything else.

Re: Gitlab to lay off 7% of staff

#318

Post by coryfklein »

hn_throwaway_99 wrote: post #264
jlmorton wrote: post #190

> The current macroeconomic environment is tough No, it isn't, and it's embarrassing at this point to continue insisting this. The macroeconomic environment is good, particularly in the United States. Business investment is growing at 3% a quarter (annualized), which is better than the average over the past decade. Employment is growing rapidly. Inflation has been tame over the past six months. And wages are growing…

This feels like another semantic argument, this time over what "macroeconomic environment is tough" means. You are correct in everything you say in your first paragraph. That said, it's fair to say that "sharply rising interest rates" are also part of the macroeconomic environment. You can say that it was silly for all these tech companies and investors to think the free money spigot would go on for so long, but the…

The sharply rising interest rates are a problem if you have a short runway that makes you reliant on debt or investor money, in which case yes you very well may need to cut costs just to keep the lights on.

But if you're Microsoft or Google? You're profitable. You're bringing in money hand over fist. Technically the high interest rates might benefit you because now you have more options of what to do with that giant pile of cash: you can lend it out and get a decent return!

So high interest rates maybe do justify layoffs in some cases. And even perhaps for GitHub specifically, though I'm not sure I understand the complex dynamics of how it generates value for Microsoft anyway...

Re: Gitlab to lay off 7% of staff

#319

Post by zopa »

charcircuit wrote: post #283
mplewis wrote: post #256

Earlier quoted context omitted.

The economy is not a human body.

It's an analogy

A bad one. What's the insight here? If a body were a nation-state, it'd be a totalitarian hellscape where life is cheap, individuals exist only to support the collective and some populations are invaders to be exterminated.

Re: Gitlab to lay off 7% of staff

#320

Post by marcosdumay »

goodpoint wrote: post #138
arbuge wrote: post #56

At this point it's beginning to look like tech companies are doing this because it's the trendy thing to do, along with inserting a few words about AI in their websites and pitch decks.

beginning?! It's been pointed out for months that that this is part of a coordinated attack on workers.

It's a coordinated attack on the companies, and anybody that is going to hold shares long term. Focused specifically on the ones that will buy shares after one or two announcements of larger than usual profits but will hold for more than a couple of months.

The people doing this do not lose time thinking about workers.

(About Gitlab specifically, they are not profitable, so a layoff is a normal survival strategy if their cash is running low.)

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