International technological companies grabbed the headlines in 2022, unfortunately for the wrong reasons as the global economic turbulence prompted tech companies to take the difficult decision of laying off some of their staff and put hiring of new staff on hold.
This is as their businesses struggled to reduce operating costs in order to attain financial stability in the midst of the economic challenges.
The redundancies by the tech companies was in reaction to various factors such as the fears of a looming recession, the war in Ukraine, slowing business growth, increasing labour cost, high interest rates, increasing cost of fuel, issues with supply chain, slump in PC sales, among others.
Data by TrueUp’s tech layoff tracker reveals that so far this year, 182,605 employees worldwide, have been affected by the 1,138 rounds of layoffs by tech companies. More layoffs are still expected as reports of more companies planning to downsize are still filtering the air.
Here are some notable tech companies that have slashed or plan to shed the headcounts of their employees in 2022:
Meta owner, Mark Zuckerberg on November 9, confirmed the rumour of a layoff in his company after he shed 10% of his workforce which was about 11,000 staff.
This was after Meta shares lost two-thirds of their value, as he blamed risky investment during COVID-19 in the hope that it will translate to accelerated growth but didn’t turn out as hoped. This has now led to Meta laying off a mass of its staff for the first time since its inception.
Zuckerberg admitted blame for getting things wrong at Meta saying “Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
A November 14 report of The New York Times revealed that Amazon is set to cut about 10,000 of its staff representing just 1% of the company’s 1.5 million global workforce or 3% of corporate employees.
It was reported earlier this month that the company informed its employees of a hiring freeze for all Amazon corporate positions.
During the company’s third quarter earnings call with analysts, Amazon’s CEO, Brian Olsavsky, was reported to have complained about the macroeconomic conditions forcing the company’s customers to cut down on their spending.
After his successful purchase of Twitter, Elon Musk on November 4, sacked about 3,800 of his staff, representing almost half of its global employees.
Justifying his action in a now deleted tweet, Musk said, “Regarding Twitter’s reduction in force, unfortunately there is no choice when the company is losing over $4M/day.”
There were also reports that days after the job cuts, Twitter laid off between 4,400 contract staff without notice. Some media reports disclosed that most of the contract employees found out they’ve been laid off after they lost access to the company’s email and internal communications systems.
Recall that before Musk’s acquisition, the company had in July 2022, relieved 30% of its talent acquisition team.
Kuda bank based both in Nigeria and in London joined the growing list of tech companies that laid off its staff as approximately 23 members of staff were reported to have lost their jobs.
The provider of debit cards, current accounts, savings accounts, lending and business accounts, in a statement said, “Kuda is currently making some strategic changes to serve its customers better and continue to make financial services more accessible, affordable and rewarding to every African.”
Kuda in the statement explained that the jobs affected spread across the company’s departments, including growth, marketing, and product.
Microsoft was reported to have sacked almost 1,000 of its employees globally in October. The company made the announcement after it recorded the slowest revenue growth in over five years in the quarter that ended September 30.
This was after the company had hiked staff salaries in May so as to retain its employees. This also came three months after the company retrenched less than around 1,800 of its 180,000 workers.
The company, in a statement in October said, “Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly. We will continue to invest in our business and hire in key growth areas in the year ahead.”
Software maker, Oracle its move to accrue $1billion in cost savings, announced in October that it was cutting an additional 201 jobs. The company had initially announced a first round of layoffs last year, after it acquired healthcare data specialist firm, Cerner in December.
Snap Inc., on August 31, in its attempt to cut cost, confirmed that the company will lay off 20% of its workforce. This amounts to approximately 1,300 people. The company had lost 80% of its value in 2022.
Those affected in the layoff is mainly the content team, which will end the production of most of their original Snapchat long-form shows. Also to be affected in the exercise, will be the company’s hardware division.
In a memo to the employees, Snap CEO, Evan Spiegel informed them of the firm’s need to restructure its business in order to address its financial challenges, adding that the company’s year-over-year revenue growth rate for the quarter of 8% was “well below what we were expecting this year.”
In 2022, the streaming service, made a total of 450 layoffs. In May, after it recorded its first subscriber loss in a decade and continual shrinking of subscriber counts, Netflix shed 150 workers, representing 2% of its workforce. Towards the end of the following month, Netflix again went on a 300 layoff exercise.
So far, Netflix’s stock is down 58% this year. It cited slowing revenue for the slow company growth. It further explained that the layoff was due to business need rather than personal performance issues of the retrenched workers.
Defending its action, the streaming service, in a statement to its employees said, “While we continue to invest significantly in the business, we made these adjustments so that our costs are growing in line with our slower revenue growth.”
FORD MOTOR COMPANY:
International car manufacturer, Ford, in a restructuring move in August, sacked 2,000 of its full-timed salaried employees and a further 1,000 agency personnel were scrapped. The sack of the affected workers, according to the auto company, took effect September 1.
Bill Ford, Ford Executive Chairman, and CEO Jim Farley stated that “the people leaving the company this week are friends and co-workers and we want to thank them for all they have contributed to Ford.
In July, the CEO in the company’s second-quarter earnings call in July, was also reported to have said “we absolutely have too many people in certain places. No doubt about it. And we have skills that don’t work anymore, and we have jobs that need to job.”
Shoify on July 26, disclosed that it had laid off 1,000 workers, representing 10% of its global workforce. The company’s stock price is down 78% in 2022.
Disclosing this in a memo to staff, CEO Tobi Lutke said, he expected the post-pandemic e-commerce to continue but that didn’t happen, adding that “It’s now clear that bet didn’t pay off. Ultimately, placing this bet was my call to make and I got this wrong,” while lamenting reduction in online spending by customers.
Telsa in late June relieved 229 employees of their duties, most of whom were hourly workers as against staff in salaried positions that CEO Elon Musk initially said the layoff was targeted at.
In an email to his employees, Musk said, “Tesla will be reducing salaried headcount by 10% as we have become overstaffed in many areas,” adding that, “note this does not apply to anyone actually building cars, battery packs or installing solar. Hourly headcount will increase.”