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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

#61

Post by extropy »

coredog64 wrote: post #28
sovnwnt wrote: post #14

> 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. This doesn't seem like a good strategy for tech. Cutting everyone's salary will dislodge your top performers who can get a better position even in poor market conditions.

I don’t think the math checks out: Salary isn’t the only expense, so you might be looking at a 15% wage cut to keep 10% of the workforce. With stock performance, I’ve already taken a 10% wage cut. Cut another 15% in cash and I’m gonna be super unhappy about my comp.

This. Also the bigger the company is, the less the long term loyalty and people are generally there for the money.

So top performers will get moving quickly.

Re: “Copycat” layoffs won’t help tech companies or their employees

#62

Post by absrd »

revlolz wrote: post #33

Deleting the post, I no longer wish to discuss this.

> it seems insensitive to tell 100k+ ppl Google or Amazon fired them because "well everyone is doing it!"

Is that any more insensitive than CEOs and C-suites telling laid off workers they "take full responsibility" and "had to make a difficult decision" while facing no consequences themselves?

Re: “Copycat” layoffs won’t help tech companies or their employees

#63

Post by __derek__ »

nkozyra wrote: post #39
petilon wrote: post #8

Not 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 th…

> During the pandemic consumer spending moved online. I keep hearing this repeated as canon but is this quantified somehow? Did we really see a spike long enough for hiring sprees? And did it last until ... when? A few months ago? It seems intuitive but I'd really love to see numbers.

Yes, there was pull-forward growth in e-commerce. Using this from Benedict Evans in 2021 because it has numbers and a good graph:[1]

> The traditional way to think about ecommerce penetration is to look at share of total retail sales, and then deduct things like car repair, gasoline and restaurants - to get to ‘addressable retail’. On that basis, US ecommerce was at 16% penetration at the end of 2019 and increased to 20% or so in 2020, adding 12-18 months of growth in a year.

[1]: https://www.ben-evans.com/benedictevans/2021/5/29/boxes-truc...

Re: “Copycat” layoffs won’t help tech companies or their employees

#64

Post by wpietri »

musingsole wrote: post #40
wpietri wrote: post #22

Earlier quoted context omitted.

Will it? Most of the top performers I know are not very motivated by money, and instead value doing interesting work with people they like. Granted, there are a set of people who are very good at job-hopping while executing a performance of being a top performer. But maybe a company will do just fine those people hop away. Maybe it would do better.

Layoffs and paycuts don't bode well for any interesting work or keeping people in a mood where they are likeable. The handwringing and psuedo-calculus of cuts does further damage to any interesting work. Can't do interesting work when instead you have to fill in for a job previously covered by a junior engineer. It'd take a hell of a company culture to fight these trends.

Layoffs definitely hamper morale and disrupt operations. I'm not so sure about paycuts as long as they're done in a spirit of solidarity. I'd be fine with it as long as a) it was temporary, b) execs took the largest cuts, and c) I thought they had a real plan for getting us through the tough times.

And obviously, not laying off people has a much smaller impact on staffing and the work one is doing, so I'd like that part better as well.

Re: “Copycat” layoffs won’t help tech companies or their employees

#65

Post by mk81 »

darth_avocado wrote: post #10
treis wrote: post #2

This 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 har…

[dead]

Re: “Copycat” layoffs won’t help tech companies or their employees

#67

Post by jleyank »

coredog64 wrote: post #28
sovnwnt wrote: post #14

> 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. This doesn't seem like a good strategy for tech. Cutting everyone's salary will dislodge your top performers who can get a better position even in poor market conditions.

I don’t think the math checks out: Salary isn’t the only expense, so you might be looking at a 15% wage cut to keep 10% of the workforce. With stock performance, I’ve already taken a 10% wage cut. Cut another 15% in cash and I’m gonna be super unhappy about my comp.

Betting you’re not one of those with a target on your forehead, eh? Cutting salaries and keeping staff is better for the company going forward. Those driven by comp aren’t those that’ll stay long term. Raises come from switches.

Re: “Copycat” layoffs won’t help tech companies or their employees

#68

Post by blinkingled »

treis wrote: post #35
blinkingled wrote: post #12

Earlier quoted context omitted.

How do you define productivity in this context? Musk style LOC? How many features you shipped? Let's pick one of the more sensible ones - features you shipped. Who defines those features - is top level management responsible for the product vision, overall strategy that then middle management turns into features? For companies like MAANG that are already hugely successful and have hit a wall so to speak, they don't n…

Are you arguing that productivity, however defined, isn't down at these companies?

No I am pointing out that you are ignoring how it is defined and the fact that it needs to be defined within the context of organizational strategy and vision before usefully claiming it is up or down.

Google's problem for example is NOT that they are unable to sell more ads because their programmers are not productive - it's that they lack the vision to take the company from ad based to diversified and profitable in other areas which they have badly failed to do while still hiring ton of people and then laying them off. That's not productivity problem - it's a strategy/vision and bad hiring practices problem. Even if it meant that somehow you could hack the productivity metric to show it was reduced in some light - it doesn't mean jack when you are productive doing things that don't help your revenues.

Re: “Copycat” layoffs won’t help tech companies or their employees

#69

Post by paxys »

tarr11 wrote: post #31

The 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…

Hiring during a recession is a proven strategy. Google is what it is today because it doubled down on hiring during the 2008 recession when the rest of the industry was in the midst of layoffs and because of it was able to monopolize on top tech talent for the next decade.
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