Super interesting seeing companies grow like wildfire and overspend as returns for investors skyrocket, and then as the market swings downward, they buoy their stock prices a bit by just as quickly cutting heads.
The inverted accountability scheme for leaders doing this is another perverse enabling factor; I've complained about this before, but that tends to lead to flames about why founders etc. can't have ownership of headcount and the fate of their companies etc.
I'm not seeing a clear solution for this culture of toying with thousands of peoples' lives for a quick buck... well, aside from the (sadly) politically loaded move to unionize more white collar work and thus provide actual accountability. Why unions are a political matter is beyond me; IATSE uses their strength to ensure excellent benefits for their members in media/entertainment.
Unionization is the correct response here. The incentives of company leaders simply don't account for workers' desire to not lose their jobs. The only way to change this is for workers to change said incentives--by organizing. Of course, easy for me to say as a freelancer. I'm definitely not trying to say unionizing tech would be easy. But it certainly is simple, at least conceptually.
Couldn't this potentially make it so those jobs never existed in the first place? Seems companies would be less willing to hire if it becomes harder to let employees go. What is the incentive to take risk? The reason Europe is almost out of the tech race entirely is in large part due to European companies not taking risks.
I think there needs to be some sort of counterbalance. We probably don't need full UAW style unions, but we need some sort of collective voice and power so that there can actually be a conversation with management.
I think Germany's work councils could be a good starting point to work from.
Unfortunately when unions are weak, they are negative value - and when they are strong they are the UAW. Workers are not a firm, and structuring labor as it's own firm is known as contracting and or a guild.
I'd love to see some apprentice programs in IT, it would at least give everyone a standard base of knowledge like what you are supposed to have in a union journeyman. Right now everybody with six months experience considers themselves senior, we have no standards and we all fight each other which isn't how a union works.
I used to work in a unionised engineering department. There were benefits, such as being hard to lay off large amounts of the workforce. There were also disadvantages, such as collective bargaining which meant high performers generally weren't rewarded and salaries were generally below market.
Yep, it's good with the bad. Another "good" as I get older is that seniority means something, it's harder to discriminate against the older guys and replace them with a 20 year old for half the price.
That makes sense on the face of it, but if you look back over the other professions that have unionized (steel workers, auto workers, truck drivers), the lives of the actual workers always seems to have suffered post-unionization.
The Jobs Bank was set up by mutual agreement between U.S. automakers and the United Auto Workers union to protect workers from layoffs. Begun in the mid-1980s, the program is being tapped by thousands of workers. Many of those receiving checks do community service work or take courses. Others sit around, watching movies or doing crossword puzzles -- all while making $26 an hour or more.
The Big Three automakers agreed to the system to protect union workers from outsourcing and technology. But with Ford and General Motors losing money in North America -- and contract negotiations due in 2007 -- the future of the unique program is uncertain.
I need a citation for this. IATSE has some of the best benefits (pension and healthcare) for their members in media/entertainment, as I understand it entirely funded by cuts from residuals.
And their take is, directly from their site, "$95.00 per quarter and 1% of gross earnings under the contract."
Not directly related to Unions... but look at salaries for SDEs in Europe compared to the US. You can almost 2x-3x a salary for the same job. A large factor is that European companies don't take risks. At least, compared to the US.
Do you think these people would have been better off if tech had carried net fewer heads the past couple of years? Having an extra 100k employed for two years is worse than those jobs just never existing?
Aside from the money, I'm quite glad my job was cut, in hindsight, but only because Amazon handled it so well: They gave us time to sort out a new position. I'm already much more excited about my new gig, and for the right reason (not $).
I'm not sure a union would have helped there, but I'm not opposed. Amazon tried to make hay while the sun was shining, and it didn't work out for all depts. It happens.
Looking at unions from a personal lense can make them seem unnecessary and maybe even negative to some people. However their purpose in my opinion is to benefit the collective of members as a whole.
I have nothing to back up this claim, but it seems like selfishness is what caused reduction of unions in the US. And for the same selfishness it's tough to organize people and kickstart a new union.
You have to show they actually benefit the members as a whole. Union laws in the US are extremely strong, and anti union sentiment is largely a hangover from the 70s, where features of unions limited our manufacturing sectors ability to compete internationally with catastrophic consequences for the Rust Belt.
did you know in advance your job was cut??? because most people did not. some of those people left everything 1 month ago to build a new life in a new country. and for having done that a few times in my past it includes using some of your own money to move / sell things cheaper and obviously for people having to come back to lower wage country where it is harder to find a good job (because tech is not a huge sector like in the US) then it become horrible if you have debts or loans. especially if you left a good job for growing at FAANG
1. I was saving for a house downpayment, so I put most my earnings right into the bank and had already minimized spending
2. They announced layoffs immediately, but then gave us time to finish work and transfer internally. If we couldn't transfer, they would lay us off after 6 weeks. This happened to me as I was a manager of a particular specialty and it was tough to transfer to a job I wanted. Furthermore, everyone around me was cut, so we could all work together and support eachother for 6 weeks.
3. My wife has a full time job so our income was reduced, not eliminated.
4. We had family nearby for any childcare problems, so I could focus on a new job hunt
5. I had friends and network nearby, so I could look for local jobs quickly and efficiently
6. I had a referral from an old co-worker, and that referral turned into my new job, which so far I love.
7. I had insisted on working remote from my hometown area, which has much lower cost of living (which helped with 4, 5), and made our situation much less dire
8. I got a lot of traction from a linkedin post during the 6 weeks job-hunt stage. This is just a function of my coworker network and I'm lucky to have those folks
I feel for those who didn't have these factors. I cannot imagine how difficult it would be to have to navigate visa issues on top of a lack of a local network and reduced / eliminated income. I definitely had home-court advantage in all this.
The point is we all know how much these same companies will whine about skills shortages in a couple of years.
Even if they cannot manage to make a cent off their work work and completely fail to train them or at least give them experience; they can very easily just write down the salaries till they do need them.
But by hiring all these people a few years ago, didn't Amazon (and other large tech companies) give these people some valuable experience, beside a quite decent salary?
I personally would prefer to be hired by a big tech company and then laid off, having received the salary, severance pay, and experience, than to never set my foot there.
Debatable, maybe some people like new grads would prefer it that way but a lot of these people already had experience and jobs before showing up at Amazon. Some may have moved, others turned down other offers, 6-12 months of 20% extra pay doesn’t justify the lurch. In general forcing employees to take on the lion’s share of risk is a jerk move without offering a similar share of profits.
It is frustrating, to be sure... but I think 18k jobs for 2 years is a net-positive for society.
We wouldn't be here discussing this if the economy had not done so poorly.
What if on average, you hire 10 people a year. Each year, there's a 10% chance of having to lay off 10 people. Details of profit/loss aside, what is the optimal move? Never hire so you never have to lay anyone off? Hire only 5 people a year so the impact is not so large?
>The point is we all know how much these same companies will whine about skills shortages in a couple of years.
Is that the point? That implies the market is hot again (and I agree with you, it will be eventually) and people are working where they want to. If that's your prediction, what's the problem here? The solution is not to jump ship to Google, then, isn't it?
From Amazon's point of view, this doesn't seem too far removed from their annual firing quotas which I think is already an onerous practice.
From the hyper-scale startup point of view, it's blatantly unsustainable and frankly irresponsible to play fast-and-loose with people's careers by hiring them and then making the position redundant, sometimes within less than a year; even six months in some cases that I've known. The best one can hope for is a generous severance so as to buy time to find a new job in an increasingly crowded market.
Irresponsible for who? Corporations are in the business of their own interests. Employees are a resource to furthering a businesses goals. They aren’t a charity that owes individuals anything. If you think that you’re being naive about what we call at-will employment.
> Irresponsible for who? Corporations are in the business of their own interests. Employees are a resource to furthering a businesses goals.
Personally, I find layoffs irresponsible at a corporate level. When they happen they disrupt team relationships, gut out tribal knowledge, break trust, and create friction that trades short term savings for long term cost. The human cost for unemployment is also hard to ignore. For every 1% increase in unemployment there is a 1-1.6% increase in suicides.
I say that as someone who is working at a company that made headlines for layoffs.
But corporations can't exist without their employees. If they don't see the value in retaining and building good employees, what kind of business do they expect to build? It should be a more symbiotic relationship.
At-will employment being something specific to the US and not the world that exists outside of it...we don't all share the same view on employment (and employment rights for that matter) that the US does.
No, I personally did not decide this. Corporations decide this for themselves. Whether I agree or not has nothing to do with the reality of the current situation.
Maybe for some. The illusion they had of a nice job, especially with lots of money promised, made them take too big a credit for their house or whatever. And now they're doomed.
You can always say this is their fault for not having foreseen that, but it probably wouldn't have happened to them if they had another, more regular job.
Nobody "made" them do anything. I never graduated college, I barely made it out of high school. Where did I acquire this knowledge to save money and live reasonably, while these other software developers are "made" to obtain these lifestyles requiring $300k a year?
My guess is that these people, who are "doomed", don't actually exist. I have a strong suspicion that, over the last few years, most folks got in while it was good, and are happy they were around while it lasted.
Saying they would have been better off with a "regular job" is pretty presumptuous. What if these folks are actually smart people who just saved up while FAANGs were offering huge salaries? What if this isn't actually a big deal? What if it was a good thing that ICs were getting paid a lot of money for a bit, instead of having wages suppressed by investors to prevent situations like "probably wouldn't have happened to them if they had another, more regular job."
Give me the money. Let me choose how I spend it. Don't pretend you know what is best for me.
I’m think you’re saying the economy is zero sun, so if tech hadn’t hired these 100k people there would be an equivalent 100k “regular” jobs that would have been created to hire these poor people who can land a high paying tech job but are too dumb to manage their own lives and finances.
I’m not sure it works that way. With 100k fewer tech jobs, would there not have been fewer regular jobs as well?
I think more folks that are "average" (myself at the top of this list--mediocre education and "average" skillset) should carefully review finances if they find themselves in a FAANG role.
The average tenure at these companies is what--18 months? Amazon especially.
I think it's delusional to act like a FANNG-gravy train role is something that'll be around in a decade. Especially now.
>I'm not seeing a clear solution for this culture of toying with thousands of peoples' lives for a quick buck
A bit over-dramatic, no? Nothing to say about the employees who left their companies for Google to "make a quick buck"?
Business expand and contract. Should Google be considered a retirement home? The people who took these jobs are smart men and women who will go on to work at other companies. This isn't new.
I know it's much more difficult to fire people in the EU, but is there an exception if it's done as part of a layoff?
The only real solution I can think of is regulatory in nature (e.g. requiring paying out 6 months pay during a layoff, which might make companies think twice before "hiring ahead of growth")
Because let's face it, "hiring ahead of growth" is the real problem. These companies aren't firing people because they are making less money. They're firing people because they hired people before they actually needed them, in anticipation of future growth that didn't materialize.
1. The minimium notice period for termination of employment is between 1 and 3 months.
2. The employer must select which employees to lay off depending on social factors(age, do they have young children or other dependents, are they disabled etc.) and not based on performance ratings.
3. If the company is laying off staff, but also at the same time hiring people with a similar skillset, they have to offer the existing staff the preferred chance to take the positions.
I think there is also a culutural difference to think long term even when enjoying short term success, but perhaps that is also present in the US when comparing tech and non-tech companies.
Employment rules are not the same across the EU. You would have to specify the country. In NL if you fire more than 20 people in a 3 month period there is a specific set of rules you have to apply and it determines in what order you must fire people as part of a mass layoff and who you can even fire as part of a mass layoff.
I work in France… the company I work for is travel related… and we have thousands of employees. During the pandemic we did not let go a single person! We had 2 years of basically zero revenue and the most we did was offer very juicy severance package for people willing to go or to retire early!
My take is because unions facilitate less profit for C-levels, who then buy/rent lobbyists to bribe, errr, "persuade" politicians to enact laws or regulations or whatever to keep unions out.
Your comment made me wonder something i don’t remember being discussed in these terms, but what about our markets and laws makes liquidity in employers and employees work poorly?
There's no solution because, from society's perspective, there's no problem.
The whole idea of capitalism involves competition and consistent growth, right? In any human society, that leads inevitably to war and conquest. It also means exploiting whatever resources are available, including human resources. Back in the day it was using colonial slaves to cheaply mine resources, deforesting for fuel/ships/etc, or hunting animals to extinction (food, oil, pelts, etc). Today it's using cheap labor in 3rd world countries, dumping chemicals in rivers, deforesting rainforest for cattle pasture. And when a competitor (foreign empire or corporation) threatens you, you basically work to either destroy or own the competition and their citizens/customers (although you might also simply make a backroom deal for peace). All for the wealth and glory of a corporation/CEO/board/Emperor/nation.
Our companies are just acting as the new empires of global society. Have been for nearly a century, when the old empires began to crumble. Same humans, different maps & hats.
Nobody can convince me that big corps are not taking part this "trend" of firing people with the purpose of rehiring them later and keep the compensation of the workforce in check.
As many comments have already pointed out, all these companies are sitting on a huge cushion of money, and if you have money the best moment to invest is during a crisis. Companies realized a long time ago that they should find ways of lowering salaries, now the big moment finally came it seems.
It's always been a big game of follow the leader, one tech company lays off 5000 workers then a next company lays off 5000 workers because if it's good for company A it must be good for company B. It's no different than when Yahoo told all their workers they had to come into the office and all the tech companies tried to drag their workers back into the office, they just didn't want to miss the trend. In a year everyone will be hiring again and companies will be screaming about needing more skilled (and cheaper) workers but for now it's just the semi-annual culling of the herd.
That's an interesting point of view. It would make economical sense for big corps to act as a labor market cartel, and the fact that they are all laying off together is a suspicious coincidence.
As is too often the case, the cost of getting caught with their hands in the cookie jar are dwarfed by the savings over time so no reason to think they will avoid doing similar things in the future.
This is the real take away, imo. It seems like a controlled, insider effort to combat wage growth.
I essentially didn’t get a pay raise after a year of stellar performance reviews because of inflation, and with these layoffs I’m no longer in a position of bargaining power to ask for more.
Headline is confusing. It makes it sound like there will be 18k new layoffs, but this is information that has been public since November and the cuts happened two days ago. (Or at least the bulk of them did)
This article was late to the game therefore headline is garbage. Amazon laid off 18k ppl in the most clusterfuck way. They had an article leaked about the wave 1 in November that impacted some 8k to 11k and then this weds the total was brought up to 18k. The emails from the article were sent to Amazon employees on weds the 18th after Amazon employees spent all of the holidays and January stressed wondering "am I going to be laid off?"
No new layoffs, but the 18k is the collective total and it's being spread out so long because of Amazon leadership incompetence and world wide labor laws differing.
Interesting. I cannot separate what the Feds said regarding inflation tbh. On one side, the government was gloating over the fact of low unemployment numbers, on the other side, you have the Feds saying with no shame whatsoever they need to low inflation numbers by raising interest rates and orquestrate moves to layoff people with the objective to lower the demand for goods and services.
This looks like a coordinated "attack" where companies and government colluded against the common folk. There's a win-win for them. Companies will start reducing salaries since there'll be more supply of workers, and the government will say "we promise to lower inflation" as campaign slogan.
Inflation hurts the common folk as well though (people who own assets have their assets stay the same in real value, people who don't have the spending power of their bank accounts eroded).
What you're theorizing might still be happening (inflation looks like it's been controlled for the last few months, but layoffs continue), but lowering inflation is more than PR.
To be fair, inflation numbers are going back down in the US, while countries that aren't raising their interest rates (or at least not as aggressively as the US is) still have much higher inflation, double digits in some cases. So it does seem to be working, as shitty as it is.
I don't think all these companies really need to lay people off though, they're just using 'everyone else is doing it' as an excuse to get away with it and juice up their stock price.
There is an excellent interview with Clara Mattei on The Majority Report, about her book The Capital Order. She has a similar point, historically supported.
There's rarely any talk about how many of these (if any!) are actually contractors / vendors. All the big companies have outsourced a huge number of staff to agencies (presumably to be more flexible in short-term budgeting and "turning the resource off", when needed, so they don't have to worry about the legal intricacies, as that is by-design conveniently also outsourced to the vendor in most cases). Curious if the 18k here is on top of shutting down external contracts.
OTOH, not all full time roles have an actual human assigned. They could also be budgeted for, but not filled yet. Post 2008, managers usually kept a couple of unfilled roles for events like this.
Interesting take. Can we consider contract labor a “layoff”? Wouldn’t they try to “look better” (like they are not laying off) by not considering “closed contract” not the same as “layoff”?
Wouldn’t the contracted firm be doing the layoff not the tech comp?
For the company that spent decades putting mom and pop shops out of business it is very hard to feel sad for layoffs. It's just their own bed these folks now have to sleep in. As an investor I am also happy. For the workers, it's sad maybe unfair but such is life.
Is there a good tracker of layoffs in tech with a breakdown of how many were software vs marketing vs service/warehouse/ancillary workers? I'm curious what the software engineer availability glut scale might be at the moment...
https://news.ycombinator.com/item?id=34427277 (203 comments, 2 days ago)
https://news.ycombinator.com/item?id=34253478 (462 comments, 15 days ago)
https://news.ycombinator.com/item?id=33626896 (279 comments, 1 month ago)