Mass layoffs: Why tech firms are firing thousands of employees

The wave of unemployment is sweeping across the world as the mass-layoffs are haunting the tech industry.

Mass layoffs: 2022 has not been a good year especially for the people working in tech giants like Amazon, Meta, and Twitter among others as they have slashed jobs this year, with some citing the COVID-19 pandemic issue while others blame the rising inflation.

Layoffs have hit several big companies again, and the cuts this time are across multiple business functions in the companies, with the bulk of the jobs lost in the U.S. with Amazon saying recently that ‘some roles will no longer be required.

And now, thousands of young Indians are suddenly staring at an uncertain future as several technology companies and start-ups announce mass layoffs due to global headwinds and funding crunches with many refusing to stay quiet about it.

We have tried to make this database as comprehensive as possible. The common reasons for these layoffs are:

Companies unable to adapt to the situations after the lockdown and the pandemic

Inflation rising

Companies facing financial difficulties

Funding slowdown

The Ukraine-Russia war

The inefficiency of the employees in some cases

Restructure and modernisation of a company (adjustments and corrections)

EFFECT ON THE FUTURE OF EMPLOYEES – INDIA AND GLOBALLY 

According to the experts, the reasons are inflation concerns, along with rising interest rates and geopolitical issues, firms’ businesses are experiencing a roller-coaster ride in the stock market in 2022.

Not only this, these reasons have affected some startups too which gained profit during the pandemic.

“The tech industries sometimes go through some changes due to which they have to let go people as a part of a phase called “periods of major adjustments and corrections” and the post-pandemic era has highlighted the need to adjust and correct so this time, in the case of the recent major layoffs, the tech companies are in a major period of adjustment,” says Jaipur based financial advisor.

But Amazon laying off employees is very surprising because for workers, the e-commerce giant has been one of the most stable employers in tech and still the layoffs, were the largest in the company’s history.

The online retail giant Amazon trimmed its workforce weeks before the holiday season which is usually the best time of the year for any e-commerce company.

SOARING INFLATION

Financial experts also say that companies that are firing their employees are unable to raise funds due to global economic conditions and hence these laying offs have become an eventuality. The companies that were once thriving before or after Covid pandemic are now facing a major downturn due to the reduction in demand.

Also, once they will receive funding, these same companies will again resort to a hiring spree, the experts further said.

Experts have also advised that employees must look for more sustainable companies in the short term till the global economic scenario improves as it is the normal business cycle and hiring will kick in again.

Some companies have given two prominent reasons for these mass layoffs. One is that they hired many employees during the pandemic and the second is soaring inflation in the US has made brands reluctant to spend money on advertising.

Over 137000 employees were laid off in this year 2022 by over 800 tech companies worldwide, according to Layoffs.fyi, a website that tracks tech companies’ layoffs.

NRI’S IN LINKEDIN LOOKING FOR ‘IMMEDIATE’ JOBS

The unfortunate ones who are being laid off in the United States are being invited to return home by Indian companies. However, there are many on H-1B visas – who still want to stay back in the US but must find employment within 60 days in order to avoid having to leave the country (United States) and return to their native countries.

Now, many are using LinkedIn to reach out to their networks in an effort to find new employment, particularly.

There are many Indians who are among the unfortunate 11000 people affected due to recent layoffs at Meta with some having over 10+ years of experience. So, hiring the best with more experience was a badge of honour at tech companies but not anymore as layoffs keep surging.

Not only Indians but Americans are also the victims of mass layoffs in the United States.

Also, not only in the United States but several employees in many countries including India are also looking for job opportunities after having been laid off.

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