All of us have seen massive waves of layoffs at the top tech companies in last couple of months and majority are implementing hiring freeze too. What is going on? How did the tech world get into rough waters? In this article, we are DKODING just that — what this could mean for YOU! …And Blood on streets: Why Google issued this warning?
Highlights:
- Google Cloud leadership strongly warns the employees against massive layoffs.
- In June, Tesla laid off 229 employees from San Matteo office.
- Apple let go of 100 contractual team members.
- Crunchbase identifies only 9% tech workers currently have a job security.
- Why most of the layoffs are happening in the tech industry?
Tech companies across the world are laying off employees at staggering rate. Are we heading towards a massive recession/economic downturn…
2021 was the year of Great Resignation. Employees in the Tech industry all across the US resigned at a snowballing rate. Continuing the mass hysteria, the news from Tech giants are once again signaling towards erratic employment trends/mass tech layoffs ahead in 2022. The tables have turned and Silicon Valley tech giants like Google, Microsoft, Facebook and more have initiated mass layoffs.
A report by Insider states that —
“Google employees are facing major job insecurity after a recent warning by the Google Cloud sales leadership against “overall examination of sales productivity and productivity in general” and if results in the net quarter “don’t look up, there will be blood on the streets.”
Watch: Google THREATENS Lazy Employees: There Will Be BLOOD!
The war for attracting the best talent in the market was at its peak till a few months ago. However, every well-known brand in the market is now freezing hiring and opting rigorous productivity audit.
According to the Founder of FAANGPath –
It’s like almost every second day you’re hearing about a new company or big tech company announcing hiring freezes.
Other tech giants who have warned against layoffs and have halted new hiring are Microsoft, Uber, Meta and Amazon.
Tech workers who have been laid off in the wave are sharing their experience all over Twitter, everyday — Non Stop.
CEO Pichai calls out low employee productivity
According to Sundar Pichai —
Google is struggling with underwhelming performance by the employees. He stated that the team productivity is below the company’s standards.
It can be reflected in the Q2 revenue of Google this year which was much less than the projected figures.
Consequently, the company has rolled out a new initiative to tackle the situation- The Simplicity Sprint. The aim here is to increase productivity and motivate employees to “Create culture that is more mission-focused.”
According to the findings of Crunchbase, mere 9% employees in Tech industry are feeling secure in their job in August 2022.
In the last 6 months, 30 top tech companies of the world have lost a total of $4.3 trillion in market capitalization.
What does the market reflect? Should you really be scared?
The market really reflects figures to worry about. In the last 6 months, 30 top tech companies of the world have lost a total of $4.3 trillion in market capitalization.
These companies together account for a behemoth chunk of overall revenue from the tech companies globally. The downward trend started in June and so far, only $900 billion worth of recovery has been registered in the valuation of these 30 tech giants.
Watch: Tech Layoffs and Hiring Freezes | The Great Resignation
Some of these companies are Apple, Microsoft, Alphabet, Amazon, Tesla, Meta, NVIDIA, TSMC, Tencent, Alibaba, Samsung, and more.
While Google maybe the most recent participant in the tech layoff frenzy, it was actually Microsoft that started the trail. This was followed by Netflix that dropped around 450 employees in May and June.
Tech companies as large as Netflix have trimmed down their headcount in 2022 — some citing the effects of the Covid-19 pandemic and others blaming the overhearing during times of big growth.
In June, Tesla layed off 229 employees after it shut down its San Matteo office. It was later reported that Musk is bearish on the economy ahead and might cut down the Tesla workforce by 10%.
Recently, around 100 contractual team members working with Apple were laid off. Twitter, during the rollercoaster Musk episode, let go of 100 employees, including 30% of talent acquisition team to reduce the company cost.
What is behind this tech toll?
The major reasons behind such valuation drop in the tech sector is the interest rate hike by the US Federal Reserve to tackle high inflation. This has led to a direct visible impact on the stocks these tech giants.
It started in April this year when more than $1 trillion were wiped off from the tech valuation in stock market due to uncertainties reflected by the Fed.
Following in May, one-fifth of total valuation of the tech centric S&P 500 has been erased. Through downsizing the team strength, tech companies are trying to reduce the cost, reinstate high productivity standards, slashing down unnecessary processes, and bracing up for the economic downturn that has already started.
Stay tuned for more as we’ll keep DKODING — How far into the future will the tech industry layoffs last and if the Tech firms are doing the right thing or screwing up with mass layoffs…
Before You Go:
Here’s Ryan Giordano — Top Growth Expert & Coach with his current focus on tech layoffs — DKODING it further as to “Why most of the layoffs are happening in the tech industry?
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