The tech industry has faced significant challenges in recent times, such as the current economic downturn, the COVID-19 pandemic, and errors committed by major corporations.
Consequently, there have been widespread tech layoffs in 2022, with even more expected in 2023. In this context, we have compiled a list of the top tech layoffs and the reasons behind them.
Here’s a detailed list of the Top 7 tech layoffs in tech in 2023.
Top 7 Tech Companies with the most Layoffs in 2023
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Meta
Meta, the parent company of Facebook, announced a second round of layoffs in early 2023. This was after the primary round of layoffs in November 2022. The CEO, Mark Zuckerberg, said the company would streamline its operations by delegating more responsibilities to managers.
Meta's workforce was reduced to its size in mid-2021 after two years of rapid growth. The company's recruiting team was initially affected by the first layoffs in late April. The second round of layoffs followed afterwards in May, which caused reductions in its technology and business teams. This made them top the list of the most tech layoffs in 2023.
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Alphabet
Google and Alphabet CEO Sundar Pichai announced in January that the company would cut either 12,000 jobs or 6% of its global workforce.
He explained that Alphabet had been preparing for a very different economic reality than we are currently facing. As a result, the company has decided to restructure and focus on its most important businesses.
Most of their subsidiaries and sub-brands also experienced job cuts. The robotics division(Intrinsic) and the health division(Verily), both reduced their workforce. These job cuts were a means of streamlining the operations within the company.
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Microsoft
Microsoft began its second-largest round of layoffs ever in January. This was after announcing plans to eliminate 10,000 jobs over the next three months.
Like other tech companies, Microsoft sought to reduce costs as customers scaled back spending after the pandemic.
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Amazon
Amazon has recently made a series of layoffs, resulting in a total of 18,000 employees. These layoffs have primarily affected the retail and recruiting teams and are part of the company's efforts to cut costs and improve efficiency.
The CEO, Andy Jassy, explained that the company is facing economic challenges and slow revenue growth, which contributed to the layoff decision.
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IBM
Although other tech companies have laid off staff due to strategy changes, IBM's layoffs were due to financial hardship.
After selling off its AI and infrastructure management divisions, IBM cut 1.5% of its workforce in January. The company is focusing on hiring for software development and customer-facing roles while reducing headcount in areas where AI can replace human workers.
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Salesforce
Salesforce began the year by announcing it would lay off 10% of its workforce, or about 8,000 employees. This decision was created by over-hiring during the pandemic.
The company realized it couldn't sustain the increased staffing levels as the economic recession increased. Salesforce may go for a second round of layoffs as the company seeks to focus more on profitability.
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Shopify
In May 2023, Shopify laid off 20% of its global workforce, the company's second major round of layoffs in less than a year. The first round of layoffs in July 2022 reduced the workforce by 10%, and the May layoffs amounted to over 2,300 people. These layoffs are as a result of the company's efforts to reduce costs and become more efficient.
During the pandemic, tech companies like Amazon, Meta, Yahoo and even Shopify saw their headcounts double in months. As the market conditions changed, companies have been able to adjust their focus from growth to efficiency. This has affected not only major tech firms, but also startups in a wide range of industries.
Other Notable Tech Layoffs
Although the tech industry's recent layoffs have been driven by some of the biggest companies like Google, Amazon, Microsoft, and Meta. There are notable companies that had some cutbacks this year. These include:
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Zoom
Zoom announced layoffs of 1300 employees after CEO Eric Yuan acknowledged that the company had not hired sustainably. The company’s success led to rapid growth, but it wasn't sustainable in the long term.
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Yahoo
Yahoo laid off 20% of its workforce, that’s approximately 1600 employees. The layoffs were part of the company's effort to streamline operations and become more efficient.
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Spotify
Spotify announced eliminating 1,500 jobs on December 4th, marking its third round of layoffs this year. The company has been taking steps to cut costs and increase efficiency.
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Twitter
Elon Musk's takeover of Twitter resulted in the layoffs of 3700 employees. This has brought in many doubts and uncertainty about the company's future.
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OpenSea
The popular NFT marketplace, OpenSea, laid off about 50% of its staff in November. CEO Devin Finzer said the company is now focused on a new strategy and vision called OpenSea 2.0.
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LinkedIn
LinkedIn announced further layoffs on October 16, bringing the total number of job cuts this year to nearly 1,400. The majority of the layoffs affected employees in R&D roles. The layoffs were part of the company's efforts to optimize its resources and adapt to the changing market conditions.
Conclusion
The mass tech layoffs began in 2022 but continued into 2023, with many companies making even more cuts than they did last year. One of the main reasons for these layoffs was the tech industry's over-hiring during the pandemic. However, in the layoffs, the demand for tech jobs is still high, especially in non-tech companies that are increasing their use of technology.
Since the beginning of 2023, more than 240,000 jobs have been lost in the tech industry, 50% higher than in 2022. This trend has been widespread and doesn’t seem to be slowing down anytime soon. It's too early to say what the future holds but, it's clear that the tech industry is facing challenges.