The technology sector in the United States continued to lay off more workers in May, with job cuts nearly tripling from April, according to latest data.
In May, the tech sector laid off 19,072 employees, which is an almost 200 percent jump from the 6,469 layoffs announced in April, technology magazine IEEE Spectrum reported, based on data obtained from AI startup Intellizence. So far this year, the tech sector has fired 174,303 workers. Since August 2022, when the tech downturn became more visible, more than a quarter million tech workers have been let go by firms.
The massive number of tech layoffs is believed to be the result of the industry rightsizing after over-hiring workers during the pandemic, when business boomed.
Major tech layoffs in May include ride-hailing firm Lyft, which announced 2,272 job cuts; software development firm Hyland, with 1,000 cuts; cloud application services and security firm F5, with 623 layoffs; and digital real estate firm Opendoor, with 560 terminations.
Since August 2022, the tech company that announced the largest amount of layoffs has been Amazon, which cut 27,860 jobs, followed by Meta with 27,057 cuts, Alphabet 22,000, Microsoft 11,000, and Salesforce with 10,590 terminations.
The latest tech firm to lay off workers is Lyft rival Uber, which intends to terminate 200 of its recruiters, affecting 35 percent of the company’s recruiting team, according to The Wall Street Journal.
Overall, the layoffs would account for less than 1 percent of Uber’s 32,700-strong global staff and follows hundreds of other job cuts the company has implemented earlier this year.
First-Quarter Job Cuts, Tech Layoff Cycle
In the first quarter of 2023, U.S.-based employers announced 270,416 job cuts, which is a 396 percent increase compared to the 55,696 cuts in the first quarter of 2022, according to an April 6 report by outplacement firm Challenger, Gray & Christmas, Inc.
The number-one reason cited by companies for the job cuts was market or economic conditions, followed by cost-cutting in the second spot. Other major reasons included closing down the business, financial losses, demand downturn, and restructuring.
“We know companies are approaching 2023 with caution, though the economy is still creating jobs. With rate hikes continuing and companies reigning in costs, the large-scale layoffs we are seeing will likely continue,” said Andrew Challenger, senior vice president of Challenger, Gray & Christmas, Inc.
“The technology sector is leading all industries, and this talent is in demand across industries. In fact, 38 percent of all cuts are in the tech sector,” he added.
In an interview with The Epoch Times in March, Elham Assadi, the chief visionary officer at HR consultant Sedaa in San Ramon, California, said that the current tech layoffs are part of a trend that happens “every 10 years or so,” depending on the economic conditions of that decade. The pattern of the recent layoffs is the same as before, she noted.
Hiring in Coming Quarters
Though tech employees have been hit hard by the recent layoffs, things can potentially improve in the coming quarters.The information technology sector was the industry with the most positive outlook on hiring, with 55 percent of companies in the survey expecting to hire workers. The survey was based on 6,000 employer responses.
In a recent interview with Forbes, tech talent guru Ruth Ebeling, who specializes in helping organizations looking for tech talent find and build the team they need, said that the vast majority of people being laid off by big tech companies are non-tech workers. Less than a quarter of the layoffs are actual techies, she said.
Demand for tech workers is still high due to which laid off techies are quickly being hired, Ebeling stated. Most of the laid-off tech workers continue to remain in the technology sector, with over 40 percent shifting to smaller firms and startups, she added.
