Tech companies blame economic downturn for layoff spree

By Zion Rufus

So far, a growing number of technology companies have executed mass layoffs this year, with the most shocking job cuts and hiring freezes reverberating through the tech industry in November.

In the first week of November, following Elon Musk’s takeover, microblogging platform Twitter fired 50% of its workforce.

According to Musk, “Without significant subscription revenue, there is a good chance Twitter will not survive the upcoming economic downturn. We need roughly half our revenue to be subscriptions.”

In addition, Twitter also fired approximately 80% of contract employees without warning or formal notice.

Joining the trend of job cuts, Meta(formerly Facebook) laid off 11,000 members of its workforce.

Citing macroeconomic downturns, on November 9th, Meta(formerly Facebook) laid off 11,000 members of its workforce.

The company’s founder, Mark Zuckerberg shared: “We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We’re restructuring teams to increase our efficiency. But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go.”

Also citing macroeconomic challenges such as stubborn inflation, energy shocks, higher interest rates, reduced investment budgets, tech company Stripe fired about 1000 members of its workforce in November.

Stripe CEO, Patrick Collison had shared: “Around 14% of people at Stripe will be leaving the company. We, the founders, made this decision. We overhired for the world we’re in, and it pains us to be unable to deliver the experience that we hoped that those impacted would have at Stripe.”

In a similar vein, on November 3, ridesharing company Lyft announced it would layoff 683 employees as part of a restructuring plan to combat a probable recession and worsening economic conditions.

Real Estate technology company Opendoor also announced about 550 jobs in November.

According to Opendoor CEO Eric Wu, “this is one of the most challenging real estate markets in 40 years”.


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