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This is an unpopular opinion, but history from the DotCom crash tells us that the layoffs are just getting started. Turns out you can’t run at a loss forever, a

This is an unpopular opinion, but history from the DotCom crash tells us that the layoffs are just getting started. Turns out you can’t run at a loss forever, and when the going gets rough the fastest way to increase profitability is to cut costs. Say what you will about Elon and Twitter, but he definitely proved that the majority of the engineers at Twitter were adding no value to the company. That is probably true at _all_ of the large tech companies. If you work at a tech company make sure you have at least 6 months of liquid savings set aside for a rainy day.

RomanPushkin 4y ago
What did he prove? First, the effect is going to be visible long-term. Second, they're hiring as hell. For example, they have reached out to me, and I spoke with recruiters just to understand what's going on a little bit better. So yes, they're hiring people now. What he proved is that when you fire, you hire immediately (but secretly).
Loughla 4y ago
Outside looking in - it appeared that large tech companies were hiring a billion engineers just so they had them. Like safety in redundancy, and if you were employing the best and the brightest, they couldn't make a product that undercut you. I guess now's the time to start undercutting?
qbasic_forever 4y ago
The companies like Google, Microsoft, Amazon, etc. also having major layoffs are not and have not been running at a loss for a long time. Most of these layoffs are driven by shareholder demand. I suspect this will be a bit like 2008 where tech companies pulled back and then realized it was a huge mistake and went on hiring sprees again after a year. Twitter just posted a 40% or so reduction in income this quarter. It seems way too early to say they didn't need all the people they laid off. From everything I see their ad revenue is cratering from poor targeting, reliability, etc.
mjr00 4y ago
I don't think "the majority of the engineers at Twitter were adding no value to the company" is a fair statement: one because it's not clear that it was the majority, two because it wasn't necessarily "no value" as much as "not as much value as other product areas", and three because it wasn't just engineering, it's product managers, sales, marketing, community managers, everyone. That being said I do think Elon's bold moves at Twitter sent a shock through the industry. It made executives reevaluate their company's business strategies and if the non-core-business functions actually even made sense. Why is Google making a cloud gaming service, much less funding a video game studio? Why is Twitter employing people to debunk climate change? Why is Amazon employing a team of people to write jokes for their unprofitable smart home device? Corporate bloat has been common forever, but it's been especially common over the past decade with zero interest rates. There's been basically zero focus on expenses and 100% focus on growth at all costs. Scary part is we might just be getting started. Maybe we will see 50% cuts at Google/Meta/Amazon by the end of the year.
- woeirua 4y ago
  I think Elon was stupid in cutting the account managers and salespeople, but clearly there has been no noticeable difference in the service now that all those engineers are gone. Hence the comment about not adding value. And if you read the whistleblower report you might seriously question what they were doing before Elon reset everything. I wouldn’t be surprised if 2023 marks the start of another tech recession. The era of outrageous tech salaries is over.
rurp 4y ago
> Say what you will about Elon and Twitter, but he definitely proved that the majority of the engineers at Twitter were adding no value to the company. Unless you care about revenue, which has been crushed due to Elon's actions. The company is less healthy than a year ago and still coasting on reserves of previous work and network effects. Musk is spending billions, and refusing to pay valid debts, just to keep the lights on. He admits that the company might end up bankrupt. It blows my mind that anyone could be touting this as a well run business that others should emulate.
- woeirua 4y ago
  I never said it was a well run business. You’re also going to have to untangle Elons antics, laying off the account managers and laying off the engineers from the downturn in revenue.
impossiblefork 4y ago
It's pretty funny though, that people so recently talked of labour shortages, but are now, saying, not with their mouths, but with money, the opposite-- across both Google, Spotify and some others, that there are a whole 6% too many. It's even funnier in Swedish, because the word for redundancies, is arbetsbrist, 'shortage of work'.
mardifoufs 4y ago
This has absolutely nothing to do with the dotcom bubble. You can't seriously look at the balance sheets and revenue flows of tech corporations now and still think there is any comparison to be made with what happened 20 years ago. Big tech generates insane amounts of money, which is why they have been pretty resilient to the massive fall in stock prices in early 2022 while still ending the year with a net increase in headcount. Allusions to a pending "dotcom bubble burst 2.0" have also been common in every "downturn" since then and have never really materialized.

RomanPushkin 4y ago

What did he prove? First, the effect is going to be visible long-term. Second, they're hiring as hell. For example, they have reached out to me, and I spoke with recruiters just to understand what's going on a little bit better. So yes, they're hiring people now. What he proved is that when you fire, you hire immediately (but secretly).

Loughla 4y ago

Outside looking in - it appeared that large tech companies were hiring a billion engineers just so they had them. Like safety in redundancy, and if you were employing the best and the brightest, they couldn't make a product that undercut you. I guess now's the time to start undercutting?

qbasic_forever 4y ago

The companies like Google, Microsoft, Amazon, etc. also having major layoffs are not and have not been running at a loss for a long time. Most of these layoffs are driven by shareholder demand. I suspect this will be a bit like 2008 where tech companies pulled back and then realized it was a huge mistake and went on hiring sprees again after a year. Twitter just posted a 40% or so reduction in income this quarter. It seems way too early to say they didn't need all the people they laid off. From everything I see their ad revenue is cratering from poor targeting, reliability, etc.

mjr00 4y ago

I don't think "the majority of the engineers at Twitter were adding no value to the company" is a fair statement: one because it's not clear that it was the majority, two because it wasn't necessarily "no value" as much as "not as much value as other product areas", and three because it wasn't just engineering, it's product managers, sales, marketing, community managers, everyone. That being said I do think Elon's bold moves at Twitter sent a shock through the industry. It made executives reevaluate their company's business strategies and if the non-core-business functions actually even made sense. Why is Google making a cloud gaming service, much less funding a video game studio? Why is Twitter employing people to debunk climate change? Why is Amazon employing a team of people to write jokes for their unprofitable smart home device? Corporate bloat has been common forever, but it's been especially common over the past decade with zero interest rates. There's been basically zero focus on expenses and 100% focus on growth at all costs. Scary part is we might just be getting started. Maybe we will see 50% cuts at Google/Meta/Amazon by the end of the year.

woeirua 4y ago
I think Elon was stupid in cutting the account managers and salespeople, but clearly there has been no noticeable difference in the service now that all those engineers are gone. Hence the comment about not adding value. And if you read the whistleblower report you might seriously question what they were doing before Elon reset everything. I wouldn’t be surprised if 2023 marks the start of another tech recession. The era of outrageous tech salaries is over.

rurp 4y ago

> Say what you will about Elon and Twitter, but he definitely proved that the majority of the engineers at Twitter were adding no value to the company. Unless you care about revenue, which has been crushed due to Elon's actions. The company is less healthy than a year ago and still coasting on reserves of previous work and network effects. Musk is spending billions, and refusing to pay valid debts, just to keep the lights on. He admits that the company might end up bankrupt. It blows my mind that anyone could be touting this as a well run business that others should emulate.

woeirua 4y ago
I never said it was a well run business. You’re also going to have to untangle Elons antics, laying off the account managers and laying off the engineers from the downturn in revenue.

impossiblefork 4y ago

It's pretty funny though, that people so recently talked of labour shortages, but are now, saying, not with their mouths, but with money, the opposite-- across both Google, Spotify and some others, that there are a whole 6% too many. It's even funnier in Swedish, because the word for redundancies, is arbetsbrist, 'shortage of work'.

mardifoufs 4y ago

This has absolutely nothing to do with the dotcom bubble. You can't seriously look at the balance sheets and revenue flows of tech corporations now and still think there is any comparison to be made with what happened 20 years ago. Big tech generates insane amounts of money, which is why they have been pretty resilient to the massive fall in stock prices in early 2022 while still ending the year with a net increase in headcount. Allusions to a pending "dotcom bubble burst 2.0" have also been common in every "downturn" since then and have never really materialized.