Yet there’s been a proliferation of large-scale layoffs in recent months. Some of the deepest cuts have occurred in the tech and media sectors: Microsoft, Amazon, Salesforce, HP and the parent companies of Google and Facebook have all signaled plans to slash several thousand workers. After initially cutting thousands of workers, Amazon and Facebook just a few months later announced plans to lay off thousands more.
Companies in other industries also are cutting back, including Goldman Sachs, Ford, 3M, Hasbro, Boeing and Disney.
Though prices have eased, inflation remains high and is an ongoing headache for the Federal Reserve, which has been raising interest rates at the fastest pace in decades to combat it, though recently it has had to confront turmoil in the banking sector that some observers attribute at least partly to the Fed’s actions. Meanwhile, many experts say at least a mild recession is likely.
Technology firms and Wall Street banks, which belong to sectors more sensitive rising borrowing costs, have generated some of the most notable layoff announcements.
Aaron Terrazas, chief economist at the employment website Glassdoor, said three kinds of companies are cutting staff right now: those for whom debt is becoming more expensive amid the Fed’s tightening; those uncertain about the economic outlook; and those using the economic climate as an excuse to cut employees they would have let go anyway.
“The biggest question right now is this reevaluation of risk,” Terrazas said, noting that businesses coming out of the pandemic must contend with geopolitics, employee retention, investment and the supply chain.
“Today’s business leaders have been scarred by this endless parade of risk events over the past couple of years and just desperately want a year when things go according to plan — and so they’re planning conservatively,” he said. “That’s the dynamic that we’re seeing in the economy.”
Here’s a rundown of some of the more significant layoffs:
Google’s parent company, Alphabet, is cutting about 12,000 jobs, CEO Sundar Pichai said in January. He said that the job cuts — estimated to be 6 percent of the workforce — will occur across the company and that the decision came after a “rigorous review.” Alphabet nodded to the tremendous growth the company experienced over the past two years, but demand has waned with the return to in-person life and with interest rate increases, which have made borrowing more expensive. Pichai said that the company had hired to meet the prior surge but that the economic reality the company faces now is far different.
The Seattle-based e-commerce giant announced in November plans to slash roughly 10,000 corporate jobs — many from its human resources, devices and retail divisions — and raised that total to 18,000 in January. In March, Amazon said it planed to lay off an additional 9,000 workers, citing an “uncertain economy.” The reduction appears to be the largest in a decade of near-constant expansion, with more than 1.5 million employees at the end of September. Amazon, like other tech companies, went on a hiring binge during the pandemic, and analysts say the layoffs mark the end of an era marked by industry bloat. (Amazon founder Jeff Bezos owns The Washington Post.)
In November, the parent company of Facebook and Instagram announced plans to cut 11,000 jobs, or 13 percent of its workforce, in an effort to rein in expenses and focus on transforming its advertising business. The cuts underscored a tumultuous new period in Silicon Valley, whose tech giants have been long regarded as recession-proof. Mark Zuckerberg, the company’s founder, has said declines in online shopping and advertising competition led to a decline in revenue. His company has also bet big on a push to create a virtual world often called the metaverse. In March, Zuckerberg announced that an additional 10,000 workers would be cut.
Microsoft plans to lay off 10,000 employees, the company said in January as part of a restructuring plan to focus on areas of growth and brace the company for an economic downturn.
The tech giant is the latest corporation to cut workers amid economic uncertainty, coming off the spectacular highs of the early pandemic period, when Wall Street cheered on the staggering gains of internet, software and communications companies.
The layoffs at Microsoft amount to less than 5 percent of its workforce. Some of the impacted workers will be notified as soon as Wednesday, the company said.
The cloud-computing giant — whose products include the popular workplace chat system Slack, as well as tools for sales, marketing and customer service — announced cost-cutting plans that include shedding 10 percent of its workforce. Salesforce has more than 79,000 employees, meaning the layoffs could affect nearly 8,000 people. Co-chief executive Marc Benioff said the company hired too many people when its sales surged during the pandemic. Salesforce’s latest quarterly report showed a slowdown in its revenue growth rate.
The entertainment behemoth announced in February that it planned to cut around 7,000 jobs in a sweeping effort to save $5.5 billion. The reductions came only months after Bob Iger, who led Disney through its golden age, returned to the company, promising big changes. In announcing the cuts, Iger said Disney is “committed to running our businesses more efficiently, especially in a challenging economic environment.”
Rupert Murdoch’s News Corp is reducing its workforce by 5 percent, or about 1,250 jobs, Reuters reported in February. The media giant that publishes the Wall Street Journal posted a 10.6 percent decline in advertising revenue, part of an industry-wide slump accompanying higher interest rates. It also incurred $6 million in one-time costs because of a scrapped merger with Fox Corp.
The computer giant said in November that it would trim 4,000 to 6,000 workers by the end of 2025 in an effort to reduce costs. The announcement came after HP reported an 11.2 percent drop in fourth-quarter revenue compared with the same period in 2021; full-year sales dipped 0.8 percent. The staff reductions were included in the company’s “future ready transformation” plan.
The PC maker is shedding about 5 percent of its workforce, or around 6,650 positions. Plunging demand for personal computers has forced the company to enact a broader cost-cutting program that also includes a hiring freeze and a pullback on travel. “What we know is market conditions continue to erode with an uncertain future,” Dell Vice Chairman Jeff Clarke told employees, according to a Monday SEC filing. “The steps we’ve taken to stay ahead of downturn impacts — which enabled several strong quarters in a row — are no longer enough. We now have to make additional decisions to prepare for the road ahead.”
The technology company plans to cut around 3,900 positions, or about 1.5 percent of its global workforce. IBM said the cuts were related to earlier divestitures of its Kyndryl and Watson Health businesses, although those moves took place long before the job cuts were announced in late January.
The San Francisco-based communications technology firm announced Monday that it would be laying off 17 percent of its workforce. That’s 1,500 jobs based on Twilio’s Sept. 30 head count of roughly 9,000 people, according to an SEC filing. Executives said the cuts were part of a broader restructuring plan designed to shift the company toward greater profitability.
“For the last 15 years, we ran Twilio for growth, building a tremendous customer base, product set, and revenue base. But environments change — and so must we. Now we have to prioritize profit far more than before,” wrote Jeff Lawson, Twilio’s co-founder and chief executive, in a Feb. 13 blog post announcing the layoffs.
The Arlington, Va.-based aerospace giant plans to shed roughly 2,000 non-unionized jobs, primarily in the company’s human resources and finance divisions, a Boeing spokesman confirmed Tuesday. The spokesman emphasized that the company plans to hire about 10,000 people throughout 2023, following 15,000 hires the year before.
“We expect lower staffing within some corporate support functions so that we can focus our resources in engineering and manufacturing and directly supporting our products, services and technology development efforts,” the spokesman said.
Redirecting its focus on electric vehicles and their batteries, Ford in August let go about 3,000 white-collar contract employees, according to the Wall Street Journal. It represented a 1 percent reduction in Ford’s 183,000-person workforce and mainly affected workers in the United States, Canada and India, according to the Journal. On Tuesday, Feb. 14, the automaker announced plans to cut 3,800 jobs in Europe, while expanding battery production operations in Michigan as part of a broader transition toward electric vehicles.
The investment bank started shedding as many as 3,200 jobs in early January following a slump in dealmaking in 2022. As with other Wall Street banks, Goldman’s employees expected a drop in annual bonuses, according to the New York Times, and getting no bonus at all can be taken as a sign to leave.
The investment bank’s cuts will go well beyond a ritual year-end culling of underperformers, according to multiple news outlets. Goldman’s head count would still be higher than it was going into the pandemic, the Wall Street Journal reported, noting it was roughly 49,000 compared with 38,000 in 2019.
3M said it would cut 2,500 manufacturing jobs after the company reported rapid declines in its consumer-facing markets, including slowing demand for disposable respirators and covid-related disruptions in China. The company said the cuts are part of a strategy to address slower than expected growth, as it adjusts its manufacturing output. The layoffs will affect about 3 percent of 3M’s workforce.
“We expect macroeconomic challenges to persist in 2023,” chief executive Mike Roman said.
In December, the investment bank trimmed about 1,600 workers, or 2 percent of its workforce, CNBC reported. The cuts appeared to be part of a tradition among Morgan Stanley and its peers to cut a percentage of low performers at year’s end — a practice that had been suspended during the pandemic. The bank had seen its head count grow roughly 34 percent since early 2020, partly as a result of two acquisitions. Inflation has cut into dealmaking, according to Reuters, putting pressure on investment banks that earned record profits a year earlier from consulting on mergers, acquisitions and IPOs.
Swollen by pandemic hiring, the food delivery company in November shed 1,250 corporate jobs, about 6 percent of its workforce. Chief executive Tony Xu said in a note to employees that company leaders were “not as rigorous as we should have been in managing our team growth,” as the company’s revenue growth was eclipsed by operating expenses.
The world’s second-largest fashion retailer, based in Sweden, said in November that it would cut 1,500 positions, about 1 percent of its workforce. The move was part of a $177 million effort to cut costs amid surging inflation in Europe tied to the war in Ukraine, Reuters reported. Compounding the retailer’s woes were disappointing third-quarter results as it struggled to keep up with Inditex, the owner of Zara.
The cryptocurrency exchange said in a November blog post that it would slash 30 percent of its payroll, or 1,100 workers, to “adapt to current market conditions.” The industry experienced a dramatic downturn in 2022, erasing billions of dollars of investments.
Kraken said that it had tripled its global workforce in recent years and that the reduction would bring its head count back to 2021 levels. “Unfortunately, negative influences on the financial markets have continued and we have exhausted preferable options for bringing costs in line with demand,” the company wrote.
Online payment company Stripe will cut 14 percent of its workforce. In a memo to staff in November, the company said the 1,100 job cuts will return Stripe’s head count to almost what it was in February 2022.
Shopify announced last summer that 10 percent of its staff would be laid off. The company reported a head count at the end of 2021 of more than 10,000 people, meaning the layoffs are estimated to impact about 1,000 workers.
Video-streaming company Vimeo said in early January that it would lay off about 11 percent of its staff, or about 140 people, “due to the uncertain economic environment.”
BuzzFeed announced in a December filing that it was eliminating 12 percent of its workforce due, in part, to “challenging macroeconomic conditions.” According to CNN, the cuts will affect roughly 180 people in the sales, technology, production and content teams for both BuzzFeed and Complex, which it acquired last year. The company’s stock closed out 2022 at 69 cents per share, after shedding 87 percent of its value.
Other media companies are also shedding staff amid a softening advertising climate and economic uncertainty. CNN, whose former parent company had merged with Discovery in early 2022, had earlier announced hundreds of job cuts. The country’s largest newspaper chain, Gannett, underwent a round of layoffs that was expected to affect roughly 200 journalists, shortly after it shed about 400 positions in August and froze hiring for hundreds more positions. Paramount Global reportedly laid off several dozen workers, and Disney has implemented a hiring freeze amid plans to restructure.
Vox Media, the company behind New York Magazine, the Verge and Vox, is cutting about 7 percent of its staff, the company said Friday. Chief executive Jim Bankoff said in a note to staff that cuts will affect multiple teams throughout the company, affecting about 130 people.
The Washington Post laid off 20 of its 2,500 employees in January. The move follows action taken last year to shutter The Post’s Sunday magazine and lay off 11 newsroom employees.
Spotify chief executive Daniel Ek announced Jan. 23 that the streaming company would slash 6 percent of its workforce, citing the “need to become more efficient” and over-hiring during the pandemic. “I take full accountability for the moves that got us here today,” Ek wrote in a blog post, which also discussed reorganization plans.
According to its most recent annual filing, Spotify had just over 6,600 employees at the end of 2021.
The toy and entertainment giant announced Jan. 26 it would eliminate 15 percent of its global workforce amid broader organizational changes designed to yield $250 million to $300 million in savings by the end of 2025. The layoffs will affect roughly 1,000 jobs and be rolled out over the next several weeks.
Hasbro’s consumer products division “underperformed in the fourth quarter against the backdrop of a challenging holiday consumer environment,” CEO Chris Cocks said in a news release. The company owns a wide array of brands, including Wizards of the Coast, Monopoly and Playskool.
The e-signature company plans to lay off about 10 percent of its workforce as part of a broader restructuring plan. An earlier round of layoffs affected about 9 percent of the company, according to CNBC, which reported on Feb. 16 that the latest cuts will bring DocuSign’s head count to around 700.
The chemical company announced in late January that it planned to reduce its workforce by 2,000, or about 5.5 percent of its workforce, as it seeks to save $1 billion in 2023. The plans also include closing down certain company assets and “aligning spending levels to the macroeconomic environment.”
Jim Fitterling, Dow’s chairman and chief executive, said those actions would allow the company to navigate “macro uncertainties and challenging energy markets, particularly in Europe.”
Online payment company PayPal said it will lay off 2,000 employees, or about 7 percent of its global workforce. In a memo to staff published to the company’s website, chief executive Dan Schulman said PayPal made significant progress in addressing “the challenging macroeconomic environment” but added the company has “more work to do,” as it restructures and focuses on core priorities. The cuts will occur over the next several weeks, Schulman said.
The videoconference company said in February that it would lay off 15 percent of its workforce, or 1,300 workers — and chief executive, Eric Yuan, said he’d take a 98 percent pay cut. Yuan said the company had not assessed whether it was growing sustainably, as its product became ubiquitous during pandemic lockdowns and business skyrocketed. Now that much of the world has returned to in-person life, some consumers have emerged in a state of “Zoom fatigue” — and the company’s shares have plummeted.
Facing a $30 million shortfall, the radio broadcaster announced in February that it planned to lay off about 10 percent of its staff, or roughly 100 people. In a memo to staff, CEO John Lansing said the broadcasting company was experiencing a decline in advertising revenue, especially in podcasting. He also noted the tough environment for the media industry in general.
The telecommunications giant plans to cut a total of 8,500 positions, or 8 percent of its workforce, by the end of 2023, CNN reported on Feb. 24, The company experienced lower-than-expected fourth-quarter earnings as equipment sales slowed in the United States, according to Reuters.