Big Tech companies have announced tens of thousands of layoffs in recent weeks amid stock losses, jumbo interest rate hikes implemented by the Federal Reserve and consumers’ pivot away from goods in the aftermath of the worst of the coronavirus pandemic.
At the height of the pandemic, the Federal Reserve slashed interest rates to near-zero levels, both former President Trump and President Biden signed COVID-19 stimulus bills into law and consumer spending on goods skyrocketed while most of the world was under lock down.
As a result, Silicon Valley saw an enormous spike in growth and stock gains.
But more recently, return to in-person, pre-pandemic lifestyles have led to revenue declines for these companies. The Federal Reserve has also increased interest rate hikes six times and stock performance has fallen.
In the past month, Big Tech firms have announced a rash of layoffs citing revenue decline and a grim economic outlook.
Here are the tech companies that have announced layoffs in 2022:
Meta
Mark Zuckerberg, CEO of Meta, announced 11,000 layoffs earlier this month, while the company’s stock has sunk 66 percent since the start of 2022.
The cuts amount to around 13 percent of Meta’s workforce. The announcement follows the company’s substantial investment in the Metaverse, a virtual reality experience that received lukewarm public feedback.
Meta’s products include Facebook, Instagram, Messenger and WhatsApp, and its apps have faced increasing competition from social media rival TikTok.
The chaotic acquisition of Twitter by billionaire Elon Musk resulted in many controversial changes at the company, including the layoff of around 3,700 employees. Following high-profile exits of top executives, Musk announced the layoffs — which affect around half the company’s workforce— adding he had no choice as “the company is losing over $4M/day.”
In the wake of the layoffs, many raised concerns about the proliferation of misinformation resulting from a lower staff count. This week, the CEO made headlines again when he gave remaining employees the option to commit to “hardcore” hours or leave the company.
Amazon
The e-commerce giant began laying off employees this week after reports it plans to trim 10,000 workers. Initial cuts are expected to affect the devices and services team, which help manufacture the company’s popular virtual voice assistant Alexa. The layoffs are anticipated to affect 1 percent of the company’s global workforce, which consists of around 1.5 million people.
The decision comes one year after Amazon began bolstering warehouse staff to keep up with consumer demand. Following record-pandemic highs, the company’s shares fell 40 percent this year.
Lyft
Earlier this month, the ride-sharing platform Lyft announced it would cut 13 percent of its workforce or around 700 workers, following a hiring freeze in September and prior layoffs in July. The company based its November decision on inflation strains and recession fears, along with rising costs of ride-share insurance.
Despite the layoffs, the company said it was confident in its overall trajectory. Employees will receive 10 weeks of pay and health insurance through April 2023.
Stripe
Stripe, an online payment firm, cut its staff by 14 percent this month, after the company overestimated the growth of retail sales this year and in 2023, its CEO, Patrick Collison, said. High interest rates, rising inflation and recession fears also played a role in the decision, the executive said.
The layoffs will bring the total number of employees down to around 7,000. The company’s recruitment teams being disproportionately affected by the cuts.
“We think that 2022 represents the beginning of a different economic climate,” CEO Patrick Collison wrote in a memo announcing the cuts. Around 1,100 employees were laid off.
Salesforce
Following lightened demand, Salesforce laid off hundreds of employees this month. Although an exact number is unknown, it’s estimated to be less than 1,000. The company acknowledged it needed to cut back on spending. Prior to the announcement, it had over 73,000 employees.
This year, the company’s stock fell by 38 percent, according to ABC.
Microsoft
Microsoft laid off around 1,000 employees in October in the wake of slower revenue growth last quarter. At the end of June 2022, the company employed around 220,000 people, while the cuts spanned different positions, levels and geographic regions.
The news was first reported by Axios.
“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,” the company told the outlet.
Robinhood
The financial services company said it would lay off 23 percent of its staff in August, a move driven in part by high inflation and the crypto market crash. Affected sectors included operations, marketing and program management functions.
The decision follows reduced customer activity on the platform and a 9 percent workforce reduction announced in April 2022. Online retail stock trading grew throughout the pandemic, but leveled off in 2022 thanks to rising consumer costs.
Coinbase
The company cut 18 percent of its workforce in June in the wake of sinking cryptocurrency prices and a global economic slowdown. In a memo to staff, CEO Brian Armstrong told employees the crypto exchange “grew too quickly,” adding, “A recession could lead to another crypto winter, and could last for an extended period. In past crypto winters, trading revenue (our largest revenue source) has declined significantly.”
The reduction led to the loss of around 1,100 jobs, while last week another 60 employees were laid off.
Cisco
Cisco plans to lay off over 4,000 employees, affecting around five percent of the networking giant’s staff. The company currently has around 83,000 employees, but plans to round out December with roughly the same number of employees it started with at the beginning of the fiscal year.