Several companies have cited fears of a recession in their decisions.
Companies across the tech industry have announced layoffs, affecting thousands of workers in the first few weeks of 2023.
Sales at top tech firms have retreated from the blistering pace attained during the pandemic, when billions across the world were forced into isolation. Customers stuck at home came to rely on delivery services like e-commerce and virtual connections formed through social media and videoconferencing.
Company officials have often cited economic uncertainty and fears of a recession in their job-cutting, cost-cutting decisions. It follows a volatile 2022, which was also marred with layoffs by the thousands across major tech brands.
YahooYahoo will lay off 20% of its workforce by the end of the year, including 1,000 employees this week, the company announced on Feb. 9.
The cuts are focused on the company’s ad tech division, Yahoo for Business, which will reduce its workforce by nearly 50% by the end of 2023 amid a restructuring of the company’s ads business, a Yahoo spokesperson said.
“These decisions are never easy, but we believe these changes will simplify and strengthen our advertising business for the long run, while enabling Yahoo to deliver better value to our customers and partners,” the spokesperson said in a statement.
ZoomZoom, a videoconference company, laid off roughly 1,300 employees, which amounts to 15% of the company’s workforce, CEO Eric Yuan said in a memo to employees on Feb. 7.
The company boomed during the pandemic, tripling its size over a period of two years, Yuan said.
“As the world transitions to life post-pandemic, we are seeing that people and businesses continue to rely on Zoom,” he added. “But the uncertainty of the global economy, and its effect on our customers, means we need to take a hard — yet important — look inward to reset ourselves so we can weather the economic environment.”
eBay
E-commerce company eBay announced in an SEC filing on Feb. 7 that it’s laying off 500 people, or 4% of its workforce, within the next 24 hours.
In a letter to eBay employees, CEO Jamie Iannone said that the layoffs are happening to help the company focus on growth, invest in new technologies and “to deliver better end-to-end experiences for our customers and to support more innovation and scale across our platform.”
Bustle Digital GroupBustle Digital Group — the parent company of online media outlets like Bustle and NYLON — laid off 8% of its staff on Feb. 1, the company told ABC News. The company also suspended operations of the culture news site Gawker.In an internal memo to employees on Wednesday, Bustle Digital Group CEO Bryan Goldberg said the company experienced a “financially strong 2022″ but encountered a difficult business environment at the outset of 2023.”Unfortunately, this will result in us eliminating several positions around the Company,” Goldberg said. “While it is always difficult to part ways with team members, these changes will give us the flexibility to re-prioritize and further invest in our strongest areas of the business in 2023.”The layoffs were first reported by Max Tani, a media reporter at Semafor.
PayPal
Payments company PayPal is cutting 7% of its staff, which amounts to about 2,000 employees, President and CEO Dan Schulman said on Jan. 31.
The layoffs arrive as the company adapts to “the challenging macro-economic environment,” Schulman said.
“Addressing these changes requires us to make hard decisions that will impact some of our colleagues,” Schulman added. “Change can be difficult — particularly when it includes valued colleagues and friends departing.”
SAP
SAP, the biggest software company in Europe, will lay off 2.5% of its global workforce, which amounts to about 2,800 employees, an earnings report on Jan. 26 showed.
The move, which the company described as a “targeted restructuring,” will cost between 250 million and 300 million euros, the earnings report said.
The layoffs will deliver yearly cost savings in 2024, the company said.
Dotdash Meredith
Dotdash Meredith, one of the nation’s biggest publishers of print and digital media, laid off 274 employees or 7% of its staff, CEO Neil Vogel said on Jan. 26 in a memo to employees obtained by ABC News.”We are not immune to the broader challenges of the ad industry and of the economy as a whole, and today’s actions are a direct response to these realities,” Vogel said.”With the difficult market environment and economic uncertainty that lie ahead, we must prioritize our biggest opportunities and make sure we have the proper cost structure in place to pursue them,” he added.
IBM
IBM will lay off 1.5% of its workforce or about 3,900 employees, the company announced on Jan. 25.
The move is tied to the previously disclosed spinoff of Kyndryl, an IT-management company, as well as the sale of two business units, a spokesperson told ABC News.
The layoffs will cost the company $300 million over the first three months of 2023, the spokesperson said.
Spotify
Spotify, the Sweden-based music streaming platform, announced on Jan. 23 that it plans to slash 6% of its workforce, which amounts to about 600 employees.
After strong pandemic-era performance, the company encountered a challenging business environment, CEO Daniel Ek told employees in a memo.
“Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk to the impact of a slowdown in ads would insulate us,” he said. “In hindsight, I was too ambitious in investing ahead of our revenue growth.”
Wayfair
Online home goods retailer Wayfair will lay off about 1,750 workers or roughly 10% of its staff, the company announced on Jan. 20.
Wayfair saw business surge during the pandemic, as people stuck at home eschewed brick-and-mortar shopping and increased spending on furniture, home renovations and other domestic improvements.
But the economic environment has turned against the company, as inflation has strained household budgets and limited nonessential purchases.
The move last week follows a previous round of layoffs in August that cut 5% of the company’s workforce.
“We thrive when we are scrappy and dedicated to customer outcomes,” Wayfair CEO and Co-founder Niraj Shah said Friday in a message to employees. “Unfortunately, along the way, we over complicated things, lost sight of some of our fundamentals and simply grew too big.”
Vox Media
Vox Media is also laying off employees, according to the Vox Media Union.
In a Jan. 20 statement on Twitter, the union said, “We were informed today that the company is laying off around 7% of its workforce, and some of our members have been impacted. We’re furious at the way the company has approached these layoffs, and are currently discussing how to best serve those who just lost their jobs.”
Alphabet Inc., the parent company of Google, said it will cut roughly 12,000 jobs from its global workforce on Jan. 20.
The decision will impact approximately 6% of the company’s employees.
“This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with,” said Google’s CEO Sundar Pichai in an email to Google employees on Friday morning.
“I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.”
Pichai told employees the company is “bound to go through difficult economic cycles” and will “reengineer our cost base, and direct our talent and capital to our highest priorities.”
Microsoft
Microsoft said on Jan. 18 it will lay off 10,000 employees this year, affecting nearly 5% of Microsoft’s global workforce.
The layoffs at Microsoft arrive in response to “macroeconomic conditions and changing customer priorities,” the company said in a filing with the Securities and Exchange Commission.
“As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” Microsoft CEO Satya Nadella said in a memo to employees on Wednesday.
He continued, “We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one.”
Amazon
In early January, Amazon announced plans to eliminate just over 18,000 roles total, including impending layoffs announced in November. The majority of roles being cut are in Amazon Stores and People Experience and Technology Solutions teams, according to an email sent to employees from Amazon CEO Andy Jassy.
Jassy had warned in November that job cuts at the e-commerce giant would continue in early 2023. Amazon employs roughly 1.5 million employees around the globe.
“This year’s review has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years,” the message read.
It continued, “We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted. However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me.”
Coinbase
Coinbase, a cryptocurrency trading platform, announced it will lay off 950 people, in a Jan. 10 statement from CEO Brian Armstrong.
“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario,” Armstrong said in the statement.
“While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.”
Layoffs affecting other industries
Delivery company FedEx said on Feb. 1 that it would slash 10% of employees on its officer and director team, according to a memo from FedEx President and CEO Raj Subramaniam.
The company needs to become a more “efficient, agile organization” in an effort to align itself with customer demand, Subramaniam said.
“Saying goodbye to longtime colleagues and friends whom we value and respect is extraordinarily difficult,” Subramaniam said. “It is my responsibility to look critically at the business.”
Newell Brands — the parent company of a host of consumer brands like outdoor goods company Coleman and cookware company Crockpot — announced on Jan. 23 it plans to lay off 13% of its office staff.
The move came in response to “the reality of the economic environment,” CEO Ravi Saligram said in a message to employees.
“There’s no sugar coating this news,” he added. “We will have to part with colleagues who we value and enjoy working with.”
Disney CEO Bob Iger said on Feb. 8 that the company is set to eliminate 7,000 jobs in targeting a total of $5.5 billion in cost savings. In all, $3 billion in cuts will come from content, excluding sports, he added; while $2.5 billion will come from non-content cuts. The eliminated jobs amount to roughly 3% of the company’s 220,000 workers worldwide, according to a securities filing made in October.
