These "copycat" layoffs are like a bigger version of those prank youtube videos where some people run through a crowded cafe feigning mortal terror, and everyone in the cafe starts to run along with them.
“Copycat” layoffs won’t help tech companies or their employees
261–270 of 310 posts
Re: “Copycat” layoffs won’t help tech companies or their employees
#262The professor recommends across the board pay cuts as an alternative to layoffs. > One thing that Lincoln Electric, which is a famous manufacturer of arc welding equipment, did well is instead of laying off 10% of their workforce, they had everybody take a 10% wage cut except for senior management, which took a larger cut. So instead of giving 100% of the pain to 10% of the people, they give 100% of the people 10% of…
In a high inflation environment, not giving raises is essentially a pay cut but doesn’t have the same negative psychological effect.
And RSU’s are a huge portion of comp in tech companies, it’s easy to cut RSU’s. Setting aside the very top performers, the middle 80% are not going to have an easy time finding a job in this environment. And may be less likely to leave when so many other companies are cutting but they happen to be at one of the few that didn’t cut but simply scaled back bonuses.
Re: “Copycat” layoffs won’t help tech companies or their employees
#263If 100k people are let go that’s 100k licenses lost across ~25 different vendors. Layoffs are happening because growth is flatlining or reversing. Tech is very insular as startups are created to solve problems in other tech companies, so if the flywheel of tech companies buying from each other stops, the entire thing can reverse quickly. Also seed rounds were oversubscribed with no diligence, product, and money raise…
This is true. Every SaaS startup I've worked for, in the early days all of the "paying customers" are other startups (usually nepotistically funded by the same VC firm). That's why a startup company can emerge from stealth mode with 10 unicorn logos on their homepage.
Re: “Copycat” layoffs won’t help tech companies or their employees
#264The professor recommends across the board pay cuts as an alternative to layoffs. > One thing that Lincoln Electric, which is a famous manufacturer of arc welding equipment, did well is instead of laying off 10% of their workforce, they had everybody take a 10% wage cut except for senior management, which took a larger cut. So instead of giving 100% of the pain to 10% of the people, they give 100% of the people 10% of…
> except for senior management, which took a larger cut. There's your trouble -- even if a company would go the "pay cut" route now, there is no chance in a million where the leadership at the top would ever agree to losing a single dime. If anything, it would be performative, with other payment options making up the difference.
Hyperbole. From a recent WaPo article:
Apple chief executive Tim Cook has voluntarily taken a 40 percent pay cut for 2023, an unusual move that comes “in response to shareholder feedback,” according to the company's annual proxy statement. The decision puts Cook's target compensation at $49 million, down from $84 million in 2022.
Re: “Copycat” layoffs won’t help tech companies or their employees
#265The professor recommends across the board pay cuts as an alternative to layoffs. > One thing that Lincoln Electric, which is a famous manufacturer of arc welding equipment, did well is instead of laying off 10% of their workforce, they had everybody take a 10% wage cut except for senior management, which took a larger cut. So instead of giving 100% of the pain to 10% of the people, they give 100% of the people 10% of…
I believe simply a pay freeze would be equivalent to a 3% cut. That way people don't feel you are "taking away" salary they may have come to expect. That in addition to a hiring freeze might get the company close to the mark in a year's time. An annual pay freeze then can be re-evaluated again next year.
Agreed. Except this year it’s probably more like a 7% cut (inflation is still pretty high).
Re: “Copycat” layoffs won’t help tech companies or their employees
#266Earlier quoted context omitted.
Alas, probably not. A great example here is the NUMMI plant. In brief, Totota was kicking the collective asses of US carmakers. The techniques were not a trade secret; indeed, Toyota was happy to teach anybody. As part of that, they did a joint venture with GM called NUMMI, so they could show how they implemented core principles like "respect for people" and "continuous improvement". And it worked! Using the same bui…
Thanks for the recommendation. This GM/automotive documentary was also interesting: "American Factory" https://www.imdb.com/title/tt9351980/ (Don't be put off by the dramatized trailer)
Good movie but very different take away message, at least for me
Re: “Copycat” layoffs won’t help tech companies or their employees
#267Earlier quoted context omitted.
I think you have missed most of blinkingled's point, and I encourage you to address it fully.
There's no point in debating the meaning of productivity unless someone claims it's neutral or up. If they're willing to make that claim then it might be worth that debate. Otherwise, it's a pointless side track.
Okay, I’ll stand in for the previous commenters. I will argue it went up, simply because the insane stock market valuations, which led these companies to overhire because clearly business demand was up as well, no? Then it is up to you to prove these companies wrong for believing their productivity to be up.
Re: “Copycat” layoffs won’t help tech companies or their employees
#268Earlier quoted context omitted.
I think the problem with this strategy is that it causes the wrong people to leave. If you're a top performer, you're going to feel like a 10% pay cut is very unfair, and you're going to be able to get another job elsewhere fairly easily, even in this environment. If you're not performing particularly well, it probably doesn't feel as unreasonable, and even if you don't like it, it's tough to leave. When done correct…
Having seen both, I'm much more likely to leave /after/ a layoff than after a 10% paycut. In abstract, if there were a way to rank employees by ROI and contribution perfectly fairly, I might not worry about layoffs personally. However: 1) In my career, I've never seen layoffs which were at all good at selecting the bottom 10%. Who gets dropped is pretty random. 2) I care about other people I work with. A 10% layoff m…
People seem to be assume they layoff only poor-performers. That’s not even close to true - in the case of layoffs anyway not the annual trimming some companies do. Entire depts will be laid off. In all likelihood some of these people will get their severance and also get to rejoin soon-ish with a pay bump. It also leaves a bad taste in the mouth. All in all, indiscriminate layoffs - like the ones happening now are just self-goals.
Re: “Copycat” layoffs won’t help tech companies or their employees
#269This really depends on the percentage of the workforce your laying off. A small %2-%6 one is really getting rid of people you don't want, but it's too much of a pain in the ass to do the entire PIP & political process to do so, or they're toxic / unproductive but well positioned that firing them is hard. A streamlined 'just pick people' layoff process helps with all of those issues. The bottom %5 percentile people th…
Lower level management at Google was definitely not consulted on these layoffs. It had to be upper level only or it would have leaked more. Like really upper level. So there's no way the people @ that level know who's coasting and who isn't. I'm sure there were a lot of high performers cut along w/ some "fat".
That is what the perf review system is for, and one reason why as a lower level manager, your careful about who gets the good ratings vs. not.
Re: “Copycat” layoffs won’t help tech companies or their employees
#270> One thing that Lincoln Electric, which is a famous manufacturer of arc welding equipment, did well is instead of laying off 10% of their workforce, they had everybody take a 10% wage cut except for senior management, which took a larger cut. So instead of giving 100% of the pain to 10% of the people, they give 100% of the people 10% of the pain.
anyone have any other examples like this where a company avoided layoffs with temporary pay cuts?