Tech layoffs surprise young workers. Who’s older? Not so much; Kelly Chang was one of the 700 employees in San Francisco to be laid off in November or 13% of the company’s workforce.
According to Chang, 26, “it appeared like tech businesses had so much opportunity.” You’ve made it if you’ve gotten a job. The way forward could be maintained indefinitely.
However, Brian Pulliam took it in stride when told that his position at cryptocurrency exchange Coinbase would be eliminated. After losing his first job as an engineer at video game maker Atari in 2003, the 48-year-old said he annually asks himself, “If I were laid off, what would I do?”
Distinct generational differences emerge as the tech industry, which grew fast during the pandemic, shifts toward widespread layoffs, as evidenced by the divergent responses to their respective professional setbacks shown by Chang and Pulliam.
This week, Microsoft announced it would eliminate 10,000 positions, or around 5% of its workforce. Additionally, Alphabet, Google’s parent firm, said Friday morning that it would eliminate 12,000 jobs or about 6% of its workforce. Large-scale layoffs at rival software firms like Meta, Amazon, and Salesforce set the tone for their reductions in personnel.
Millennials and Generation Z members (born between 1981 and 2012) entered the workforce at a rapid economic growth when the number of available tech jobs grew at the same rate as iPhone demand. The firms they joined broke all kinds of economic molds as they spread throughout the globe. They weren’t just starting a new career when they joined companies that provided transportation to and from work and perks like free meals and laundry services.
Almost none of them had been affected by mass layoffs.
Young adults born between 1946 and 1980, commonly referred to as “baby boomers” and “Generation X,” experienced the worst downturn in business history. More than a million jobs were lost during the dot-com meltdown of the early 2000s, and Highway 101 in Silicon Valley became deserted as overnight, many companies went out of business.
Jason DeMorrow, a software developer laid off twice in 18 months and out of work for more than six months, described the period as “a massacre,” adding that it lasted for years. As much as I feel for the people affected by the current economic slump, I must say that it pales in contrast to what has happened in the past.
The gap between the generations in tech is emblematic of a more significant social problem. A person’s outlook on employment and financial security is significantly impacted by the year they were born. A 2011 study by economists Ulrike Malmendier of UC Berkeley and Stefan Nagel of the University of Chicago found that early life experiences significantly impact an adult’s appetite for financial risk.
People who came of age in the 1970s, during the stock market’s sluggish period, were less likely to invest in the early 1980s, when the market was booming, according to a study that analyzed the Federal Reserve’s Survey of Consumer Finances from 1960 to 2007. In the 1990s, however, that pattern began to change.
“Everything shifts after your first collision,” Nagel remarked. As a result, “You know horrible stuff happens, and maybe you should be a bit more cautious.”
The dot-com bust occurred early in many Gen Xers’ working lives. According to an analysis of BLS statistics conducted by CompTIA, a technology education and research organization, the tech industry lost 25% of its workforce between 2001 and 2005.
The widespread layoffs in the tech industry were much more severe than the 5% decline in tech jobs during the recession of the early 1990s and the 6% drop during the global financial crisis of 2008.
After a slow start, the tech industry has seen a decade-long hiring boom that began in 2011. Every year, on average, it created over 100,000 new employment, and by 2021, it had restored all the positions it had lost after the bursting of the dot-com bubble.
Companies in the software, hardware, technology services, and telecommunications industries, such as Apple, Meta, Nvidia, and Salesforce, are all reflected in the employment data. However, according to Tim Herbert, CompTIA’s chief research officer, they may leave out tech firms like Airbnb, Lyft, and Uber due to inconsistencies in government labor market data that classify some enterprises as consumer services.
The tech industry saw job growth last year despite the onset of widespread layoffs; however, it is not yet known if this trend has carried over into this year. According to a poll by ZipRecruiter, roughly 80% of technical workers who had been let go within the past three months had successfully found new employment.
Rather than a bubble bursting, “we’re seeing the hiring craze of the epidemic being corrected for,” said Andy Challenger, senior vice president of career transition firm Challenger, Gray & Christmas.
The manager of the semiconductor company night informed David Hayden, a program manager with a Ph.D. in physics, that he would be terminated from his position in the fall of last year. His first instinct was to contact recruiters and set up interviews as soon as possible since he was worried about how he would afford to send his oldest daughter to college. A month after being laid off, he found work at Lattice Semiconductor in December.
Hayden, 56, claimed that he had been unemployed since he had mentioned it in every interview. He learned that cuts weren’t always reasonable during the dot-com crash when he managed to keep his job while many of his bright coworkers were laid off.
Hayden stated, “The stigma of being unemployed has been lifted.” Companies are well aware that many talented workers are currently unemployed.
Pulliam saw his dismissal from Coinbase as a chance to pursue his interests. After leaving his job, he invested his severance pay into starting his own company, Refactor Coaching, which provides career guidance to IT professionals.
Pulliam remarked, “This is a gift.” I don’t believe that account has been shared. The outlook is consistently negative.
The layoffs have been a rude awakening for many in the computer industry who are experiencing their first recession. Chang went to school for product design to work in the technology sector, which he saw as a safe bet in the face of economic uncertainty. Getting fired from Lyft severely damaged my confidence.
At one time, Erin Sumner, a software recruiter at Facebook’s parent firm Meta, would boast to prospective employees that Facebook was the quickest company ever to reach a valuation of $1 trillion. Even when its stock price dropped and its key business, digital advertising, failed last year, she promised to highlight the company’s positives.
Last year, when rumors of layoffs spread, she reassured employees that they would still have jobs because the corporation had more than $40 billion in the bank. On the other hand, she was one of the 11,000 people who lost their jobs that November.
Sumner, 32, described the experience as “gut-wrenching.” She has recently started working for a firm called DeleteMe, whose mission is to delete a person’s personal information from online search results. But she complained that reading about new tech layoffs made her feel sick to her stomach.
Sumner expressed his concern that the situation might worsen before it improved. There is absolutely no assurance. The safest firm in the world compromised my job security.
For companies providing software services, a similar turn of events has proven difficult. Salesforce is a market leader, but its stock price dropped by over half in 2017 as its sales growth stalled. The business had spent lavishly during the pandemic, shelling out $28 billion to acquire Slack Technologies. It doubled in size from 49,000 to 80,000 workers in just two years.
Last week, during an all-hands meeting to address the company’s decision to lay off 10% of its workers, CEO Marc Benioff attempted to console his disgruntled employees by putting the layoffs in perspective.
I’ve had a lot of challenging experiences at work. As reported by The New York Times, his words were captured on a tape of the call. This is about a layoff. Sometimes I reflect on the lives of our deceased workers. I remember loved ones we had to say goodbye to but never expected to.
Benioff was asked what he would tell employees worried about the company’s future and possible layoffs, and his response was “gratitude.”
After trying to enter onto his computer and finding himself unable to access Slack, the platform he worked on as a conversation designer, Austin Bedford discovered he was one of roughly 8,000 workers being let go from Salesforce. He was born and raised in East Palo Alto, CA, and decided to major in computer design so that he could work for one of the thriving local businesses. He finally got the job of his dreams in 2021 with the corporation. He had no idea he’d go crazy so fast.
I was taken aback,” 41-year-old Bedford said.
He was let go, but he was attempting to see it as a “gift in disguise” and would take his time looking for a new career.
Bedford remarked, “Something is promising just around the bend.” I know I can do this; I have to believe.