In case you haven’t been paying attention, the economic news in the tech field isn’t exactly great. Recently, Microsoft announced plans to lay off 10,000 workers, and Alphabet, the parent of Google, disclosed that it would be handing the pink slip to 12,000 of its employees. Amazon also has announced sweeping job cuts. By some accounts, almost 50,000 people have been laid off from their jobs in the tech industry already in 2023–and we aren’t even through the first month of the year. That follows a 2022 in which about 100,000 employees of private and public tech-related companies are estimated to have lost their jobs.
This shouldn’t really come as a surprise to anyone with some seasoning. The tech industry grew exponentially during the early days of the pandemic, as the world shifted more to on-line commerce, and it was predictable that, as conditions changed and economic cycles occurred, there would be some retrenchment. What’s interesting, though, is that some of the tech leaders apparently didn’t see this entirely predictable result coming: they were confidently predicting that there had been a permanent paradigm change and the growth would continue, as one recent article notes.
And the company bigwigs weren’t alone in this view. Some young tech workers reportedly are shocked that their cutting-edge companies could–and would–lay them off; they thought they were set for years to come. Interestingly, however, their older and more experienced colleagues aren’t surprised, because many of them have been laid off before in prior tech boom-and-bust cycles.
It’s a valuable tutorial for everyone, although people seem to quickly forget the teaching: economic cycles are inevitable, retrenchment typically follows rapid growth, it’s wise to build some bad news into your business and personal planning, and confident predictions of impending future success frequently turn to ashes in the mouths of the know-it-alls who voiced them. A dose of humility and rationality isn’t a bad thing for tech company leaders–and those shocked young workers have just received a valuable life lesson that they probably will never forget.