Tech Cuts Back

Long known as a lucrative and comfortable place to work, Silicon Valley is shedding jobs at a rapid clip

- Austin Carr and Sarah McBride, with Jo Constantz

After a scramble for labor coming out of the Covid- 19 pandemic, the US economy has shown signs of reversing course. Employers announced 13% more job cuts in 2022 than they did in 2021, according to consulting firm Challenger, Gray & Christmas Inc. The cuts were small; setting aside 2021, last year saw the fewest annual cuts since CGC began tracking in 1993. Still, any tightening in the market begins to tilt leverage back to employers, threatening a brief period of worker empowerment that gave rise to concepts like quiet quitting, the Great Resignation and a generation of professionals who could supposedly spend their careers working from camper vans in Idaho.

There's one sector where the trickle is already a flood. According to Challenger's numbers, the tech industry in 2022 increased its announced job cuts by 649%, with the total of 97,171 amounting to the most since the dot-com crash more than 20 years ago. This year doesn't look any better. So far in January, Amazon.com Inc. has said it expects to lay off 18,000 people, Microsoft Corp. has announced 10,000 job cuts, and more than two dozen US-based tech companies including Coinbase, Flexport and Salesforce have said they'll cut their workforce by 10% or more, according to the website Layoffs.fyi, which is tracking job cuts in the industry.