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In this case, they make a disproportionate amount of their revenue on jobs postings and selling recruiters the right to spam us. With less jobs their revenue go

In this case, they make a disproportionate amount of their revenue on jobs postings and selling recruiters the right to spam us. With less jobs their revenue goes away. They don’t need as many salespeople and internal recruiters. Microsoft has historically been pretty ruthless about annual culls. It used to be in the GE mode of cutting the bottom 5-10% each year. More recently it’s more quiet. I don’t begrudge companies this. They need to move resources where they’re most needed.

monadic2 6y ago
I imagine at some point a reputation like this affects hiring ability.
- michelb 6y ago
  Seems to not be a problem for Facebook
  - curiousllama 6y ago
    On the contrary - they pay a premium for tech talent
  - monadic2 6y ago
    I don’t know of many industry veterans who look lovingly over that fence. My impression is that they use an “overwork the eager graduate” style of hiring, like many in the top ten tech companies do. Meanwhile the careerists at Microsoft seem pretty happy, fwiw. My closest friend there seems content to work there for the rest of his life and he seems to be producing good quality work, even if they are pushing him into management.
- raxxorrax 6y ago
  On a sellers market for sure. And who wants to perform top throughout their whole career? Really doesn't sound that interesting to be honest.
- pandaman 6y ago
  Lucas Arts (the game arm of Lucas Film) has been doing this since the early 2000s. Allegedly, new management came from the film industry and could not comprehend why their game studios kept FTEs between projects. So they started laying off most of the staff at the end of a project to rehire them a few months later. After a couple of iterations they started canceling projects because they could not get enough staff (e.g. the PS3/360 Indiana Jones game could not start because of this, allegedly) and eventually had to shut down their game business all together despite being one of the bigger players at the turn of the century. I have not been working there but have quite a few acquaintances who did and all of them had been out by ~2007. I also had to turn down dozens of their recruiters during those times.
- mathattack 6y ago
  Depends on the industry. Happens often enough in cyclical industries like retail, consulting and financial services. It’s more shocking when old-line stable companies lay off for the first time. One of the lessons from IBM and HP is the first cut is rarely the last.
- silveroriole 6y ago
  For a while when I was frustrated with coworkers I dreamed of joining a company that openly said they fired the bottom x%. I think Netflix had a presentation along those lines. I’m older and less into the idea now, but it might attract young confident people who care too much about their work, which is mostly what tech companies want.
Zafira 6y ago
> It used to be in the GE mode of cutting the bottom 5-10% each year. Hasn't it been demonstrated that GE under Jack Welch was basically a massive fraud?
- simonebrunozzi 6y ago
  You might be right, but source?
  - ultraluminous 6y ago
    Not OP but - https://qz.com/1811291/jack-welch-was-the-best-and-worst-thing-that-happened-to-ge/ https://qz.com/1811291/jack-welch-was-the-best-and-worst-thi... GE’s breathtaking growth under Welch was fueled in large part by its transformation into a financial services superpower. By 2000, nearly half of the company’s revenue—$96 billion—came from GE Capital GE’s exposure to finance proved to be an enormous vulnerability after the terrorist attacks of Sept. 11, 2001, and particularly during the financial crisis of 2008. While Welch’s successor, Jeff Immelt, tried to diminish GE’s reliance on finance, his efforts came too late.
  - mdorazio 6y ago
    Here's a good review (sorry for the paywall) [1]. Basically, Jack Welch was in the right place at the right time, probably (almost definitely) played semi-legal accounting games to beat analyst estimates (a practice which later led to accounting fraud charges [2]), and pretty much mortgaged the company's future in exchange for short-term boosts by selling off many of its business units and focusing on GE Capital, which basically got annihilated a few years after Jack left. So he was also a master of leaving other people holding the bag. Also, the man was apparently (according to many people who worked with him) a massive asshole with a huge ego problem and would epitomize every negative stereotype of white male executives if he were still alive today [3]. [1] https://www.afr.com/work-and-careers/leaders/jack-welch-inflicted-great-damage-on-corporate-america-20200303-p546bw https://www.afr.com/work-and-careers/leaders/jack-welch-infl... [2] https://www.cfo.com/accounting-tax/2009/08/ge-settles-accounting-fraud-charges/ https://www.cfo.com/accounting-tax/2009/08/ge-settles-accoun... [3] https://www.cbsnews.com/news/why-jack-welch-wont-be-missed/ https://www.cbsnews.com/news/why-jack-welch-wont-be-missed/
eldavido 6y ago
I feel like there are basically three ways to lose your job in tech. In one, the company cuts an entire business unit, or a company shuts down, or something else cataclysmic happens. This is where you have dozens/hundreds of people let go. Outside of small startups, this seems pretty rare. I think selling/divesting a failing business unit is more common than outright shutdown in tech. In the second, the employee does something really egregious and gets straight-up terminated for cause (fired). Absenteeism, theft of company property, sexual harassment, something so bad it's borderline illegal and potentially a legal risk for the employer if they don't do something about it. The third, which is what we're seeing here, is a general reduction in bloat done under the guise of "the economy". In my experience, great people don't tend to get let go in situations like this--it's political cover to remove the bottom 10%. Companies, at least in tech, don't make a routine practice of doing this without "a reason". Being in the bottom 10% can happen for a lot of reasons. Maybe you just lost interest in the work. Perhaps you don't get along with your manager, or something's going on in your personal life, or the role was never a good fit in the first place. I used to think some people were just "bad", and some indeed are, but it also seems like peoples' performance really does change over their careers. Provided there's good unemployment insurance, probably best for both parties to part ways. Not only does it give the employee a kick in the pants, but it also improves the morale of the rest of the team, because it doesn't feel like someone isn't "pulling their weight".
- projektfu 6y ago
  The fourth is the market is drying up and your line of management isn’t going to bat for you. Lots of reasons for this and many aren’t personal so no need to personalize it. Many companies try to let underperforming employees go for cause before starting a lay-off because they can avoid the repercussions in unemployment taxes.
  - eldavido 6y ago
    This hasn't been my experience, but would love more info if you could provide it. I'm actually surprised how slowly most tech companies shed staff. In general, it seems the industry is pretty hit-driven, and if you're attached to a good product that's still making money, there's rarely much attrition, even when perhaps there should be. Conversely, a lot of great people get let go when a product isn't working (misses the market or no sales). It all seems kind of arbitrary and random. It's a lot different than, say, a restaurant with really tight margins where you're a day away from getting fired if you aren't perceived to be pulling your weight.

monadic2 6y ago

I imagine at some point a reputation like this affects hiring ability.

michelb 6y ago
Seems to not be a problem for Facebook
- curiousllama 6y ago
  On the contrary - they pay a premium for tech talent
- monadic2 6y ago
  I don’t know of many industry veterans who look lovingly over that fence. My impression is that they use an “overwork the eager graduate” style of hiring, like many in the top ten tech companies do. Meanwhile the careerists at Microsoft seem pretty happy, fwiw. My closest friend there seems content to work there for the rest of his life and he seems to be producing good quality work, even if they are pushing him into management.
raxxorrax 6y ago
On a sellers market for sure. And who wants to perform top throughout their whole career? Really doesn't sound that interesting to be honest.
pandaman 6y ago
Lucas Arts (the game arm of Lucas Film) has been doing this since the early 2000s. Allegedly, new management came from the film industry and could not comprehend why their game studios kept FTEs between projects. So they started laying off most of the staff at the end of a project to rehire them a few months later. After a couple of iterations they started canceling projects because they could not get enough staff (e.g. the PS3/360 Indiana Jones game could not start because of this, allegedly) and eventually had to shut down their game business all together despite being one of the bigger players at the turn of the century. I have not been working there but have quite a few acquaintances who did and all of them had been out by ~2007. I also had to turn down dozens of their recruiters during those times.
mathattack 6y ago
Depends on the industry. Happens often enough in cyclical industries like retail, consulting and financial services. It’s more shocking when old-line stable companies lay off for the first time. One of the lessons from IBM and HP is the first cut is rarely the last.
silveroriole 6y ago
For a while when I was frustrated with coworkers I dreamed of joining a company that openly said they fired the bottom x%. I think Netflix had a presentation along those lines. I’m older and less into the idea now, but it might attract young confident people who care too much about their work, which is mostly what tech companies want.

Zafira 6y ago

> It used to be in the GE mode of cutting the bottom 5-10% each year. Hasn't it been demonstrated that GE under Jack Welch was basically a massive fraud?

simonebrunozzi 6y ago
You might be right, but source?
- ultraluminous 6y ago
  Not OP but - https://qz.com/1811291/jack-welch-was-the-best-and-worst-thing-that-happened-to-ge/ https://qz.com/1811291/jack-welch-was-the-best-and-worst-thi... GE’s breathtaking growth under Welch was fueled in large part by its transformation into a financial services superpower. By 2000, nearly half of the company’s revenue—$96 billion—came from GE Capital GE’s exposure to finance proved to be an enormous vulnerability after the terrorist attacks of Sept. 11, 2001, and particularly during the financial crisis of 2008. While Welch’s successor, Jeff Immelt, tried to diminish GE’s reliance on finance, his efforts came too late.
- mdorazio 6y ago
  Here's a good review (sorry for the paywall) [1]. Basically, Jack Welch was in the right place at the right time, probably (almost definitely) played semi-legal accounting games to beat analyst estimates (a practice which later led to accounting fraud charges [2]), and pretty much mortgaged the company's future in exchange for short-term boosts by selling off many of its business units and focusing on GE Capital, which basically got annihilated a few years after Jack left. So he was also a master of leaving other people holding the bag. Also, the man was apparently (according to many people who worked with him) a massive asshole with a huge ego problem and would epitomize every negative stereotype of white male executives if he were still alive today [3]. [1] https://www.afr.com/work-and-careers/leaders/jack-welch-inflicted-great-damage-on-corporate-america-20200303-p546bw https://www.afr.com/work-and-careers/leaders/jack-welch-infl... [2] https://www.cfo.com/accounting-tax/2009/08/ge-settles-accounting-fraud-charges/ https://www.cfo.com/accounting-tax/2009/08/ge-settles-accoun... [3] https://www.cbsnews.com/news/why-jack-welch-wont-be-missed/ https://www.cbsnews.com/news/why-jack-welch-wont-be-missed/

eldavido 6y ago

I feel like there are basically three ways to lose your job in tech. In one, the company cuts an entire business unit, or a company shuts down, or something else cataclysmic happens. This is where you have dozens/hundreds of people let go. Outside of small startups, this seems pretty rare. I think selling/divesting a failing business unit is more common than outright shutdown in tech. In the second, the employee does something really egregious and gets straight-up terminated for cause (fired). Absenteeism, theft of company property, sexual harassment, something so bad it's borderline illegal and potentially a legal risk for the employer if they don't do something about it. The third, which is what we're seeing here, is a general reduction in bloat done under the guise of "the economy". In my experience, great people don't tend to get let go in situations like this--it's political cover to remove the bottom 10%. Companies, at least in tech, don't make a routine practice of doing this without "a reason". Being in the bottom 10% can happen for a lot of reasons. Maybe you just lost interest in the work. Perhaps you don't get along with your manager, or something's going on in your personal life, or the role was never a good fit in the first place. I used to think some people were just "bad", and some indeed are, but it also seems like peoples' performance really does change over their careers. Provided there's good unemployment insurance, probably best for both parties to part ways. Not only does it give the employee a kick in the pants, but it also improves the morale of the rest of the team, because it doesn't feel like someone isn't "pulling their weight".

projektfu 6y ago
The fourth is the market is drying up and your line of management isn’t going to bat for you. Lots of reasons for this and many aren’t personal so no need to personalize it. Many companies try to let underperforming employees go for cause before starting a lay-off because they can avoid the repercussions in unemployment taxes.
- eldavido 6y ago
  This hasn't been my experience, but would love more info if you could provide it. I'm actually surprised how slowly most tech companies shed staff. In general, it seems the industry is pretty hit-driven, and if you're attached to a good product that's still making money, there's rarely much attrition, even when perhaps there should be. Conversely, a lot of great people get let go when a product isn't working (misses the market or no sales). It all seems kind of arbitrary and random. It's a lot different than, say, a restaurant with really tight margins where you're a day away from getting fired if you aren't perceived to be pulling your weight.