Recession Layoffs in 2023

 

Everyone who is connected with the corporate world on today's date is undoubtedly concerned about one thing, and that's Recession lay-offs. The start of 2023 has not at all been a good start for startups, multinational giants and also employees. 

While startups are having a funding winter, corporates are losing their valuations, and employees are losing their jobs. Not only small VC-funded startups but big international conglomerates like Google, Microsoft, Amazon, and Goldman Sachs have fired thousands of their employees. 

But the effect of the Recession is not only limited to companies and startups but also to nations. Different nations are expected to show very low growth rates due to the recession. 

The story of Recession 2023 tech lay-offs -

World's one of the biggest internet-based companies – Google's parent company Alphabet has laid off 12000 people at the start of the year. Microsoft also laid off 10000 employees. All these examples are enough to prove the perilous condition of the worldwide tech Industry. 

Let's unravel the reasons behind the mass layoffs by the tech giants - 

i. Inflation - 

Inflation is hitting everyone's pocket. After the COVID-19 crisis, the world is going through economic turmoil. Countries are experiencing record inflation, and people are running short of money, stopping them from purchasing new products or services, leading to lesser revenue for tech firms. 

ii. Unreasonable hiring - 

During the two years of the Corona crisis, tech usage by the average person was at a record high. The tech companies were also making record historical revenues, and at that time, they did unreasonable hiring. Companies like Google approximately doubled their number of employees, and now they have to fire them due to a decrease in revenues. The companies also provided lavish perks to the employees upon joining, and now the employees have to pay for them. 

iii. Pressure from investors - 

Hedge funds and Venture Capital funds were also pressuring the CEOs of different companies to fire employees, and the reason is very simple - to cut costs. They want the valuation of the companies or startups to proliferate on a year-on-year basis, and that can't happen with declining revenue. 

iv. Automation of jobs - 

While we think that the AI revolution is yet to come, it has actually arrived. Different people lost their jobs to automation. This is one of the best ways for startups to save money and still run with whatever balance they're left with. AI is helping companies to get their job done at a faster speed with less expenditure. 

Has the recession ended? 

The recession is still not finished, as countries are still struggling to manage their economy, people are struggling to get a job, startups are struggling to get funds, and Big MNCs are struggling to keep their valuations high. 

Conclusion - 

The recession layoffs in 2023 have affected a lot of people, and it's still going to run for a bit more time. But while we spoke about tech layoffs, different job roles like HR are also impacted by this recession. 

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