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In just two months, more than 50 thousand IT specialists lost their jobs worldwide. Hundreds of IT companies are reducing their staff and are not yet in a hurry to hire new staff. Experts call what is happening a "bloody massacre" and recall with horror that this already happened a quarter of a century ago, when Internet startups (dot-coms) began to close en masse. Although even then, significantly fewer people lost their jobs.
Surviving in IT is not easy
There are massive layoffs in the global information technology industry. As TechSpot writes with reference to the statistics of the Layoffs.fyi portal (it tracks the number of people who lost their jobs around the world and in many areas of activity), only in January and February 2024, more than 50.3 thousand IT specialists were left without work – that's how many people were put out of the door by 209 technology companies. The situation is obviously not getting any better – CNews wrote that in October 2022, 9,600 IT specialists were cut.
If you look at the results for the whole of 2023, then 1,191 almost IT companies have reduced within 269.2 thousand employees. According to TechSpot, it's all about the desire of these firms to reduce their operating expenses, which include salaries and other payments to staff. IT companies are trying to adapt to the current market realities, which include the stagnation of the global economy that began in 2022, and the bloated staff that took all IT employees in covid 2020, they no longer need.
"The Bloody Massacre"
Importantly, it's not just tiny IT startups that are being laid off, which have found it very difficult to pay their salaries on time and in full. On the contrary, the largest IT giants set their example for small companies-as reported by CNews, Alphabet (Google, YouTube, etc.), Amazon, Cisco, eBay, Microsoft, SAP, etc. – since the end of 2022, they have collectively laid off approximately 100 thousand people.
In some cases, companies are cutting their staff radically-the well-known PayPal payment system in January 2024 set out to lay off 2,500 people, which is about 9% of its staff.
According to the research company Challenger, Gray & Christmas, the carnage that began in the global IT sphere is so great that it is second only to the mass layoffs in the IT industry that occurred at the beginning of the XXI century.
Then the so-called "dotcom bubble" burst (Dotcom, "dot com"; - approx. CNews), which resulted in an even larger wave of layoffs in the IT sector. We are talking in this case about the unprecedented mass collapse of Internet companies, which in those years were called "dot-coms". It was preceded by the rapid growth of their shares, the price of which collapsed overnight on March 10, 2000.
According to Challenger, Gray & Christmas researchers, about 168.4 thousand jobs were cut in the technology industry in 2001, and almost 131.3 thousand a year later. As you can see, the current situation in the industry is much worse than it was 24 years ago.
As for current trends, the Challenger, Gray & Christmas report says that in February 2023, about 63.2 thousand IT specialists were laid off. A year later, this figure fell by 55%.
Dismissal as a road to a new one
The current mass layoffs may well play a cruel joke on IT companies when they need new staff again. According to a series of interviews with CNBC, in this situation, many IT professionals believe that finding a job in their field is associated with high competition against the background of a large number of people who have lost their jobs.
Roger Lee, founder of the Layoffs.fyi service, believes that many of these employees are leaving the tech industry entirely as a result. The situation is also aggravated by the problem with salaries in the global IT sector. CNews wrote that in Russia, drivers and couriers are now paid more than IT employees.
Apparently, a similar situation is unfolding outside of Russia. According to Roger Lee, the once rampant pay increases in the global IT industry are no longer there-salaries in the technical sciences sector have "largely stagnated" over the past two years.
Nothing will change
The reason for mass layoffs, the IT companies themselves call the need to reduce staff after the influx of employees during the pandemic, inflation and weak consumer demand. In 2023 and early 2024, global inflation declined markedly compared to 2022, and many of these firms turned a profit.
However, they do not seem to be going to reduce the rate of cuts. According to Jeff Shulman, a professor at the University of Washington's Foster School of Business, layoffs in 2024 can be explained in three words: stock prices. The "recovery" of the state supports the stock price at the level that firms need," so these companies see no reason to stop," Shulman added, calling what is happening the new normal. "This is for them (mass layoffs-approx. CNews) gets away with it because they all do it. Employees are gradually getting used to this, investors are happy, and therefore I think this will continue for some time," the professor summed up.
Surviving in IT is not easy
There are massive layoffs in the global information technology industry. As TechSpot writes with reference to the statistics of the Layoffs.fyi portal (it tracks the number of people who lost their jobs around the world and in many areas of activity), only in January and February 2024, more than 50.3 thousand IT specialists were left without work – that's how many people were put out of the door by 209 technology companies. The situation is obviously not getting any better – CNews wrote that in October 2022, 9,600 IT specialists were cut.
If you look at the results for the whole of 2023, then 1,191 almost IT companies have reduced within 269.2 thousand employees. According to TechSpot, it's all about the desire of these firms to reduce their operating expenses, which include salaries and other payments to staff. IT companies are trying to adapt to the current market realities, which include the stagnation of the global economy that began in 2022, and the bloated staff that took all IT employees in covid 2020, they no longer need.
"The Bloody Massacre"
Importantly, it's not just tiny IT startups that are being laid off, which have found it very difficult to pay their salaries on time and in full. On the contrary, the largest IT giants set their example for small companies-as reported by CNews, Alphabet (Google, YouTube, etc.), Amazon, Cisco, eBay, Microsoft, SAP, etc. – since the end of 2022, they have collectively laid off approximately 100 thousand people.
In some cases, companies are cutting their staff radically-the well-known PayPal payment system in January 2024 set out to lay off 2,500 people, which is about 9% of its staff.
According to the research company Challenger, Gray & Christmas, the carnage that began in the global IT sphere is so great that it is second only to the mass layoffs in the IT industry that occurred at the beginning of the XXI century.
Then the so-called "dotcom bubble" burst (Dotcom, "dot com"; - approx. CNews), which resulted in an even larger wave of layoffs in the IT sector. We are talking in this case about the unprecedented mass collapse of Internet companies, which in those years were called "dot-coms". It was preceded by the rapid growth of their shares, the price of which collapsed overnight on March 10, 2000.
According to Challenger, Gray & Christmas researchers, about 168.4 thousand jobs were cut in the technology industry in 2001, and almost 131.3 thousand a year later. As you can see, the current situation in the industry is much worse than it was 24 years ago.
As for current trends, the Challenger, Gray & Christmas report says that in February 2023, about 63.2 thousand IT specialists were laid off. A year later, this figure fell by 55%.
Dismissal as a road to a new one
The current mass layoffs may well play a cruel joke on IT companies when they need new staff again. According to a series of interviews with CNBC, in this situation, many IT professionals believe that finding a job in their field is associated with high competition against the background of a large number of people who have lost their jobs.
Roger Lee, founder of the Layoffs.fyi service, believes that many of these employees are leaving the tech industry entirely as a result. The situation is also aggravated by the problem with salaries in the global IT sector. CNews wrote that in Russia, drivers and couriers are now paid more than IT employees.
Apparently, a similar situation is unfolding outside of Russia. According to Roger Lee, the once rampant pay increases in the global IT industry are no longer there-salaries in the technical sciences sector have "largely stagnated" over the past two years.
Nothing will change
The reason for mass layoffs, the IT companies themselves call the need to reduce staff after the influx of employees during the pandemic, inflation and weak consumer demand. In 2023 and early 2024, global inflation declined markedly compared to 2022, and many of these firms turned a profit.
However, they do not seem to be going to reduce the rate of cuts. According to Jeff Shulman, a professor at the University of Washington's Foster School of Business, layoffs in 2024 can be explained in three words: stock prices. The "recovery" of the state supports the stock price at the level that firms need," so these companies see no reason to stop," Shulman added, calling what is happening the new normal. "This is for them (mass layoffs-approx. CNews) gets away with it because they all do it. Employees are gradually getting used to this, investors are happy, and therefore I think this will continue for some time," the professor summed up.
