17 June 2024 , 18:38
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Global tech layoffs are nearing 100,000 this year as the likes of Tesla, Google and Microsoft continue to shed employees in a bid to satisfy investors.
More than 98,000 employees have been laid off by 326 companies so far this year, according to online tracker layoffs.fyi.
While the number of layoffs has slowed since 2023, the sheer number of tech workers that have left their jobs this year shows the scale of the challenge facing the industry.
Bytedance, the owner of Tiktok, last week cut 450 roles following the merger of Tiktok Shop with e-commerce company Tokopedia.
Earlier this month, Microsoft eliminated 1,000 jobs in its mixed reality division. In May, Google cut 100 positions from its cloud unit, while Tiktok announced plans to significantly reduce its operations and marketing team, which comprises about 1,000 roles.
At the start of April, the total number of layoffs hit 60,000. This figure surged days later when Tesla announced the single largest tech layoff by a company since Covid-19, cutting 14,000 employees, or 10 per cent of its workforce, due to slowing demand and pricing pressures.
Another notable layoff included 3,300 jobs at Getir at the end of April as the company exited its UK and other European markets.
In London, the troubled artificial intelligence startup Stability AI cut 20 roles in April, roughly 10 per cent of its staff, and luxury fashion e-commerce platform Farfetch reduced its workforce by 2,000 in February.
One underlying motivation for some of these layoffs is to signal fiscal discipline to investors, according to media analyst Ian Whittaker. “This is what I think is at least part of the rationale for the cuts at the likes of Alphabet, Amazon and Microsoft,” he said recently.
“Given their results, there is a not a need to cut, and two years ago they would have been unlikely to implement such cuts. But making them now sends a signal that you will remain focused. That pleases investors,” he explained.
Analysts generally agree that the layoffs are likely to continue for now. However, a more positive sign for the industry is that the pace of layoffs has slowed compared to the same period last year.
In 2023, nearly 1,200 tech companies laid off 263,180 people, according to layoffs.fyi. During the first two quarters of that year, over 214,000 jobs were lost, compared to the 98,000 in the same period this year.
