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Reducing headcount growth to a level 2 years ago, doesn't really sound that crazy in a recession. Also, headcount in tech, grew at a ridiculous fast pace over t

Reducing headcount growth to a level 2 years ago, doesn't really sound that crazy in a recession. Also, headcount in tech, grew at a ridiculous fast pace over the past 3-4 years only. All these lay-offs aren't really surprising to me. What is surprising is the amount of people actually being surprised.

gumby 4y ago
What recession?
- broast 4y ago
  The actual technical recession that started in Summer 2022 and then ended the next quarter could still have lingering effects, couldn't it?
  - bregma 4y ago
    A recession is defined as three consecutive quarters of negative growth. A single quarter of negative growth doe not meet that definition. Even technically.
    - rvz 4y ago
      > A recession is defined as three consecutive quarters of negative growth. Source?
      - gumby 4y ago
        Generally, two succesive quarters, though the official determination in the US is made by the NBER https://www.bea.gov/help/glossary/recession https://www.bea.gov/help/glossary/recession
        rvz 4y ago
        > Generally, two succesive quarters, Exactly. There is no source for the unsubstantiated 'three successive quarters' claim. > though the official determination in the US is made by the NBER I would not wait for an entity to determine and tell us if it is too late. Hence why businesses are preparing now, even when they should have done in November 2021. And of course, I am not saying this in hindsight either, since the warning signs were there in [0] and finally when it happened [1]. [0] https://news.ycombinator.com/item?id=29508238 https://news.ycombinator.com/item?id=29508238 [1] https://news.ycombinator.com/item?id=33185591 https://news.ycombinator.com/item?id=33185591
efficax 4y ago
we’re not in a recession
- deleted 4y ago
  [deleted]
- icedchai 4y ago
  CNBC talking heads, economists, etc. have been calling for one. Better to prepare now. By the time the recession is confirmed it will probably be over anyway.
  - nostrebored 4y ago
    This will be an entrenched recession. We can’t do QE without exacerbating inflation and we can’t tighten without being unable to service debt.
    - crowbahr 4y ago
      The problem is the QE didn't stop in 2016 like it should have.
  - UncleMeat 4y ago
    We've been "preparing" for a recession for a year. Since then, we've seen low unemployment, flattening inflation, GDP growth, and wage growth in the US. It really is starting to look like the "soft landing" is working.
sarchertech 4y ago
Why though? It’s not like they need the money in the short term. They have almost $200 billion in cash. For the majority of Google’s departments the need for employees isn’t tied to demand. Google desperately needs to find another money printer, and ostensibly they staffed up to help them do it. That hasn’t changed, and Google‘s workload won’t drop noticeably in a recession outside of a few departments. And even in the those departments, they have so much still growing cash on hand, that they’d probably be better off to weather the storm the lay off only to rehire in a year.
- riskneutral 4y ago
  Being the steward of $200 billion is an enormous responsibility. Just because you're sitting on a pile of cash does not mean that you can do stupid things with it and not face immediate consequences by your employers (the shareholders).
matwood 4y ago
While we're not in a recession, I agree with your point. It sucks for the people it happened to, but the big tech layoffs so far have been minor compared the headcount growth the last couple of years. Economy wide, unemployment is at record lows. Step outside big tech and companies are still struggling to find talent. There's also an argument that big tech keeping a bunch of people on payroll when they don't need to slows down overall growth in the industry as it makes it harder for startups to find talent.
- bubbabojangles 4y ago
  Correct, yet the conditions do exist that point to a potential recession in the next 6-12 months. The stock market reactions and business reactions are forward looking. Even just the specter of a recession (not to mention the raising interest rates and sticky inflation for certain goods/ housing) can impact behaviors and allow business activity to slow enough for one to occur, sort of a self fulfilling prophecy. I'd imagine the Fed is not pleased that companies are hording talent and mis-allocating capital in this way (high wage inflation) to retain them (unnaturally). The wages and salaries are artificially inflated, built up over the last decade of near 0% interest rates. The Fed will persist at slowing business activity until the point it breaks. There is 3.5% unemployment in general in the US but within software developers it is more like 2.2%. Once a developer is let go, more/less they immediately find work. This is only partially what the Fed wants. It is good to curb the demand by freeing up these workers but they want real unemployment to rise before they will start to ease.
ClumsyPilot 4y ago
Why is recession relevant when the company is raking it in? Is the management of google so incompetent they cannot find a profitable application to a large part of their workforce?

gumby 4y ago

What recession?

broast 4y ago
The actual technical recession that started in Summer 2022 and then ended the next quarter could still have lingering effects, couldn't it?
- bregma 4y ago
  A recession is defined as three consecutive quarters of negative growth. A single quarter of negative growth doe not meet that definition. Even technically.
  - rvz 4y ago
    > A recession is defined as three consecutive quarters of negative growth. Source?
    - gumby 4y ago
      Generally, two succesive quarters, though the official determination in the US is made by the NBER https://www.bea.gov/help/glossary/recession https://www.bea.gov/help/glossary/recession
      - rvz 4y ago
        > Generally, two succesive quarters, Exactly. There is no source for the unsubstantiated 'three successive quarters' claim. > though the official determination in the US is made by the NBER I would not wait for an entity to determine and tell us if it is too late. Hence why businesses are preparing now, even when they should have done in November 2021. And of course, I am not saying this in hindsight either, since the warning signs were there in [0] and finally when it happened [1]. [0] https://news.ycombinator.com/item?id=29508238 https://news.ycombinator.com/item?id=29508238 [1] https://news.ycombinator.com/item?id=33185591 https://news.ycombinator.com/item?id=33185591

efficax 4y ago

we’re not in a recession

deleted 4y ago
[deleted]
icedchai 4y ago
CNBC talking heads, economists, etc. have been calling for one. Better to prepare now. By the time the recession is confirmed it will probably be over anyway.
- nostrebored 4y ago
  This will be an entrenched recession. We can’t do QE without exacerbating inflation and we can’t tighten without being unable to service debt.
  - crowbahr 4y ago
    The problem is the QE didn't stop in 2016 like it should have.
- UncleMeat 4y ago
  We've been "preparing" for a recession for a year. Since then, we've seen low unemployment, flattening inflation, GDP growth, and wage growth in the US. It really is starting to look like the "soft landing" is working.

sarchertech 4y ago

Why though? It’s not like they need the money in the short term. They have almost $200 billion in cash. For the majority of Google’s departments the need for employees isn’t tied to demand. Google desperately needs to find another money printer, and ostensibly they staffed up to help them do it. That hasn’t changed, and Google‘s workload won’t drop noticeably in a recession outside of a few departments. And even in the those departments, they have so much still growing cash on hand, that they’d probably be better off to weather the storm the lay off only to rehire in a year.

riskneutral 4y ago
Being the steward of $200 billion is an enormous responsibility. Just because you're sitting on a pile of cash does not mean that you can do stupid things with it and not face immediate consequences by your employers (the shareholders).

matwood 4y ago

While we're not in a recession, I agree with your point. It sucks for the people it happened to, but the big tech layoffs so far have been minor compared the headcount growth the last couple of years. Economy wide, unemployment is at record lows. Step outside big tech and companies are still struggling to find talent. There's also an argument that big tech keeping a bunch of people on payroll when they don't need to slows down overall growth in the industry as it makes it harder for startups to find talent.

bubbabojangles 4y ago
Correct, yet the conditions do exist that point to a potential recession in the next 6-12 months. The stock market reactions and business reactions are forward looking. Even just the specter of a recession (not to mention the raising interest rates and sticky inflation for certain goods/ housing) can impact behaviors and allow business activity to slow enough for one to occur, sort of a self fulfilling prophecy. I'd imagine the Fed is not pleased that companies are hording talent and mis-allocating capital in this way (high wage inflation) to retain them (unnaturally). The wages and salaries are artificially inflated, built up over the last decade of near 0% interest rates. The Fed will persist at slowing business activity until the point it breaks. There is 3.5% unemployment in general in the US but within software developers it is more like 2.2%. Once a developer is let go, more/less they immediately find work. This is only partially what the Fed wants. It is good to curb the demand by freeing up these workers but they want real unemployment to rise before they will start to ease.

ClumsyPilot 4y ago

Why is recession relevant when the company is raking it in? Is the management of google so incompetent they cannot find a profitable application to a large part of their workforce?