Sorry to hear that! Curious what you think of DO now? I've always loved DO but I've found it REALLY hard to recommend we us it at work
Tell HN: DigitalOcean is doing layoffs
21–30 of 264 posts
Re: Tell HN: DigitalOcean is doing layoffs
#22Earlier quoted context omitted.
how does interest rate affects company layoffs and why is being more efficient affects that? and why would FED want this? - serious question
The best I've been able to determine is: we went through a period of very low unemployment, and as a result employee class people were able to do things like "ask for reasonable pay" and "switch jobs for more money".
> the scariest thing that can happen to a capitalist system
This is nonsense. Nobody benefits from high nominal and low or negative real wage growth. Everyone does from real wage growth, including investors.
Re: Tell HN: DigitalOcean is doing layoffs
#23Earlier quoted context omitted.
how does interest rate affects company layoffs and why is being more efficient affects that? and why would FED want this? - serious question
To combat inflation in the housing market. A subset of White collar professionals (such as those in Tech, Real Estate, Finance) ended up earning so much that housing became unaffordable as a small but significant minority began buying multiple investment properties https://www.politico.com/news/2021/11/10/rent-inflation-bide... https://www.politico.com/news/2022/12/31/labor-market-high-i... “Tech and finance are taki…
Tech workers are a small portion of workers overall
Re: Tell HN: DigitalOcean is doing layoffs
#24Earlier quoted context omitted.
> My point is, layoffs will continue until companies are much more efficient, or interest rates go down. Exactly what the FED wanted.
how does interest rate affects company layoffs and why is being more efficient affects that? and why would FED want this? - serious question
The feds “dual mandate” is "maximum employment, stable prices, and moderate long-term interest rates." There’s too much employment at the moment, imperiling price stability and forcing their hand on interest rates.
Inflation expectations, particularly”wage spiral”, are tied to unemployment. The historically low unemployment would/should drive further increases in wages due to scarcity/bargaining position of labor. More layoffs and job suppression will reduce that inflation pressure.
Re: Tell HN: DigitalOcean is doing layoffs
#25When interest rates are 0%, any amount of growth compounded over years is attractive. When you can get a 5% risk-free return from treasuries, even 7% rate of return is unattractive when compared to the safest asset on earth returning 5%. My point is, layoffs will continue until companies are much more efficient, or interest rates go down.
But we aren't seeing major layoffs in other industries, unemployment is low and job growth is relatively high. It seems like the low interest rates were helping sustain a bubble in tech and that bubble is now deflating.
Which other industries relied so heavily on outside funding to stay afloat?
Re: Tell HN: DigitalOcean is doing layoffs
#26Earlier quoted context omitted.
Very sorry to hear that, though you seem to have a fairly good outlook about it. Excuse me if it's callous to ask this at this time, but as I've been observing layoffs and been hearing that people are immediately shut down from their systems, I'm wondering: how do they communicate it to you if you can't access your email? Do they reach out to your personal email, call you, send you a letter? I might understand revoki…
It was an email from the CEO to my personal email. By the time I received that email, all my IT access was already cut off: no Slack, no laptop login, no VPN, etc.
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Re: Tell HN: DigitalOcean is doing layoffs
#27Earlier quoted context omitted.
how does interest rate affects company layoffs and why is being more efficient affects that? and why would FED want this? - serious question
The FED wants unemployment to go up which will drive demand, and therefore prices, down. That will reduce inflation.
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Re: Tell HN: DigitalOcean is doing layoffs
#28Sorry to hear that! Curious what you think of DO now? I've always loved DO but I've found it REALLY hard to recommend we us it at work
I mean, I don't want this to be the "kicking them while they're down thread", but I always wondered how a little guy is supposed to compete with AWS. I say that as someone who was there firsthand to watch Rackspace get crushed by them.
Re: Tell HN: DigitalOcean is doing layoffs
#29Earlier quoted context omitted.
The FED wants unemployment to go up which will drive demand, and therefore prices, down. That will reduce inflation.
> FED wants unemployment to go up This is wrong. The Fed doesn’t want higher unemployment. It isn’t even willing to tolerate it. That’s the whole “soft landing” conversation, and why hikes are so hesitant. The ideal path would be labor market loosening with no more unemployment. Absent structural adjustments, that’s possible. But we need structural adjustments, so layoffs are necessary, which makes the closest to ide…
You're technically correct, but this seems like a bit of a distinction without a difference. The Fed may not want unemployment, but they do want people to lose their jobs, and an obvious risk of people losing their jobs is that they'll be unemployed. There's no guarantee the Fed will stick the "soft landing."
Re: Tell HN: DigitalOcean is doing layoffs
#30Earlier quoted context omitted.
how does interest rate affects company layoffs and why is being more efficient affects that? and why would FED want this? - serious question
The FED wants unemployment to go up which will drive demand, and therefore prices, down. That will reduce inflation.
Won't unemployment lead to deflation, which is also bad?