4 ms·

Any idea why 6-8% are such common numbers in most of the recent tech industry layoffs?

monero-xmr 4y ago
It's an amount you can do safely without your employees or shareholders thinking you are a sinking ship, as that's what everyone is doing. However don't be fooled - it will be 7% repeatedly until things stabilize. People think it's just 7% once. It might be, but this will be repeated if needed.
- mysterydip 4y ago
  you're not kidding. I just did an internet search for "7% layoff" and it's staggering how many results there are.
  - dboreham 4y ago
    Same reason Wall St takes a 7% commission on IPOs.
    - CSMastermind 4y ago
      https://www.insidescience.org/news/brain-seven-magic-number https://www.insidescience.org/news/brain-seven-magic-number For those unaware the number 7 seems to have a special place in the human brain as it's the number of distinct things most humans can hold in their brain at once before needing abstractions or other devices to keep track of the information. It's also the point at which our brains seem to switch from "a few" to "many" and because it's prime it's the highest a few number that we don't mentally split into groups of other numbers.
      - Aardwolf 4y ago
        7% actually really is 0.07 though (or around 1/14th), the multiplication by 100 is completely arbitrary
eugenekolo 4y ago
Layoffs typically go like 7%... then you get another 1-2% of people who jump from the sinking ship. Then you get another round of 5%.. and another 1-2% who jump from the sinking ship and end up at a nice round number like 15%. Looks better than laying off 15% at once (although Zoom is doing great?)
InitialLastName 4y ago
It's suspiciously close to what I understand to be the normal steady-state turnover rates for the tech industry. Nobody quits their jobs in an economy like this, so the turnover must be achieved by other means (and this way lets the employer pick who turns over).
dboreham 4y ago
Goldilocks.

It's an amount you can do safely without your employees or shareholders thinking you are a sinking ship, as that's what everyone is doing. However don't be fooled - it will be 7% repeatedly until things stabilize. People think it's just 7% once. It might be, but this will be repeated if needed.

mysterydip 4y ago
you're not kidding. I just did an internet search for "7% layoff" and it's staggering how many results there are.
- dboreham 4y ago
  Same reason Wall St takes a 7% commission on IPOs.
  - CSMastermind 4y ago
    https://www.insidescience.org/news/brain-seven-magic-number https://www.insidescience.org/news/brain-seven-magic-number For those unaware the number 7 seems to have a special place in the human brain as it's the number of distinct things most humans can hold in their brain at once before needing abstractions or other devices to keep track of the information. It's also the point at which our brains seem to switch from "a few" to "many" and because it's prime it's the highest a few number that we don't mentally split into groups of other numbers.
    - Aardwolf 4y ago
      7% actually really is 0.07 though (or around 1/14th), the multiplication by 100 is completely arbitrary

eugenekolo 4y ago

Layoffs typically go like 7%... then you get another 1-2% of people who jump from the sinking ship. Then you get another round of 5%.. and another 1-2% who jump from the sinking ship and end up at a nice round number like 15%. Looks better than laying off 15% at once (although Zoom is doing great?)

InitialLastName 4y ago

It's suspiciously close to what I understand to be the normal steady-state turnover rates for the tech industry. Nobody quits their jobs in an economy like this, so the turnover must be achieved by other means (and this way lets the employer pick who turns over).

dboreham 4y ago

Goldilocks.