Tech behemoths including Meta, Amazon, Microsoft, and Intel along with crypto giants such as Kraken, Crypto.com, ByBit, and now SwyftX have decided to reduce their workforce by a significant margin
Meta reduced its workforce by 11K employees. Intel by 20% of its marketing staff, Oracle Corporation by 143K employees, and Twitter by 50% of the total workforce
As the world order was restored to normal, the demand fell drastically forcing the companies to realign their workforce according to the production and the demand in the market.
According to the reports of the International Labour Organization, the world has lost over 11 crore jobs in the first quarter of 2022, but instead of things getting better with time, the situation has worsened with every passing day.
Tech behemoths including Meta, Amazon, Microsoft, and Intel along with crypto giants such as Kraken, Crypto.com, ByBit, and now SwyftX have decided to reduce their workforce by a significant margin. In the month of November, over 46 thousand tech professionals got the sack with the number only expected to increase in December.
The International Monetary Fund has predicted the global GDP in 2023 to be the worst since the great depression of 2008. As if it was not enough, the price of commodities has inflated drastically, a result of which central banks all around the world are pushing their interest rates to the skies.
Meta reduced its workforce by 11K employees. Intel by 20% of its marketing staff, Oracle Corporation by 143K employees, and Twitter by 50% of the total workforce. Other major layoffs in the industry include Salesforce, Barclays, Disney, Asana, Cisco, Caravana, HP, AMC, Kraken, AMC Networks, CNN, and ByBit. These are the names of those industry leaders that have decided to let go of their employees due to different reasons and their future human resource targets.
India is one of the largest talent pools for IT professionals in the world and these layoffs are going to impact Indian professionals by a significant margin. The Crypto industry could not stay aloof from the layoffs and some major centralized exchanges have decided to significantly reduce their workforce.
Even though the macroeconomic factors are not conducive to flourishing economies, there are more reasons than war behind the mass layoffs in the IT industry. Here are some of the reasons that are forcing industry giants to reduce their workforce.
The IT industry has been booming since the last recession and with the rise of blockchain technology, the game has reached another high. The IT sector has been a dream come true for investors due to its significant returns.
Bullish market sentiment for IT enabled the companies to entertain massive employee reserves and maintain them without any problems. However, things changed with the Russia-Ukraine war, Covid-19, disturned supply chains, and the US-China trade conflict. The IT industry had a hit due to these reasons and eventually had to downsize itself according to the demand.
The pandemic has made us realize how dependent we are on technology. When everything in the world had to stop, it was technology that made it possible for us to survive for two straight years. The demand for social media, communication, entertainment platforms, and other media interactions spiked to reach all-time highs during the lockdowns. This created a massive demand for IT professionals, content creators, and other related services.
However, as the world order was restored to normal, the demand fell drastically forcing the companies to realign their workforce according to the production and the demand in the market.
IT and crypto companies have big budgets for their marketing and are thus considered one of the most lavish spenders in the entire business ecosystem. This is critical for ensuring a higher number of sales and increasing revenues. However, this has not been the case in 2022. Businesses are working towards cutting their unnecessary expenditure as a recession is expected to hit us by the end of 2023. Extravagant organizations would not be able to sustain themselves when the worst strong will hit the bay. This is why the IT giants are cutting down their operational costs to ensure that they do not get washed out in the upcoming recession.
Most IT giants are based out of Silicon Valley in the USA and the country is most likely to hit a recession by the end of 2023. This might seem pretty far from now but today is the time that the preparation to survive a long recession should start. The crypto industry is already going under a long crypto winter with no hopes of recovery as of now and the upcoming recession could only worsen it further.
Industry giants would have to suffer if they don’t downsize their workforce now and the layoffs that we are seeing today are precautionary measures to avoid a fallout.
Indians make up a majority of the workforce in Silicon Valley and most of them are employed with a working visa. Those professionals have to return back to India if they would not able to get the next job within the next 60 days. This might not be another challenge for Indians as most companies have limited or frozen their hiring processes.
European inflation and the USA’s upcoming recession are going to affect IT demands drastically and we could witness its glimpse in the form of these layoffs.
Company layoffs not only affect the individual professionals but also their families and dependents. Reduced income or a higher number of unemployed professionals create an additional load on the national economy and thus states work tirelessly to increase the employability of its citizen. However, things get even worse when the biggest economy in the world is going to be hit by a recession. As we proceed further, we are going to come across more layoffs and cost-cutting from the organizations.
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