Key points:

  • Love Layoffs are in the air, especially in San Francisco’s Bay area. But why?
  • Many small to medium-sized tech companies have laid off thousands of employees recently citing the volatile economic landscape
  • Tech firms such as Facebook, DocuSign, Twilio, and DivvyHome are all involved in this mass exodus
  • The “layoff” fever has caught on with FinTech and crypto firms too as Coinbase and BlockFi see the largest layoffs in the crypto sector. 

Love Layoffs are in the air. Small to major tech firms have announced large-scale layoffs worldwide. We can observe a similar trend in San Francisco Bay Area. But what’s wrong? 

The volatile and extremely uncertain economic landscape is the root cause of the current layoff wave. 

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Layoffs galore in San Francisco

Publicly traded companies including DocuSign and Twilio have laid off around 7,500 employees each in September 2022 to remain profitable. That is nearly 10% of the total strength of each company. 

A real-estate startup, Divvy Homes laid off around 40 employees last week due to a consistent surge in mortgage rates. Should employees working in tech firms be worried?

There is no doubt that we have seen wave after wave of consistent layoffs, particularly in the U.S. this year. But what does it mean? Is it simply an anomaly or something to worry about?

Many labour economists believe these layoffs may not necessarily point toward a major downturn in other sectors. Despite an alarming wave of layoffs in the tech sector, they might also represent a return to more regular hiring rates. Early in the pandemic, several businesses increased hiring since more individuals were working from home or hosting events online.

Layoff in tech – major names to small players, all toe the line as economic conditions worsen

Mark Zuckerburg, CEO of Meta announced a hiring freeze last week citing unstable economic conditions. He further stated that this is the first time in the company’s 18-year history that it is compelled to downsize its staff in 2023. 

According to data collected by Crunchbase, around 41, 000 workers in the tech space have been laid off in 2022 thus far. At the fag end of September, Snap announced that it would lay off around 20% of its total workforce after a very bleak second quarter. 

Netflix, Shopify, and Mircosoft are some other heavyweights in the tech space that have laid off thousands of employees this year. Apple and Google have either frozen hiring or slowed down the process. 

All in all, tech companies are facing the brunt of the largely volatile economic landscape in 2022. 

Layoffs in the blockchain, crypto, and fintech sector are rampant

The ongoing downward trend in both the digital and traditional financial markets has had a detrimental effect on key cryptocurrency companies including Coinbase, BlockFi, and others. To survive and carry on with business, many companies are compelled to trim their workforce.

Continue reading iTMunch for the latest news and developments in the tech sector!

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Feature Image Source: Photo by Austin Distel on Unsplash