7 ms·

Ask HN: 1M layoffs soon, should gov intervene?

17 points by nothrowaways 4y ago

The cumulative number of layoffs in past two months alone is going to hit 1 million employees. Shouldn't the government intervene to prevent social crisis?

joaogfarias 4y ago
1 - "cumulative number of layoffs in past two months alone is going to hit 1 million employees" The state itself created this situation with the inflation since the end of Bretton Woods (specially the inflation during 2020-2021). If you give booze to an alcoholic he will get drunk and afterwards he will have a hangover. 2 - "Shouldn't the government intervene to prevent social crisis?" - Despite warning from people like Hayke and Mises, people tried to do all sorts of state-controlled economies (Germany, USSR, modern USA, etc). It didn't work. Better to drink lots of water, take a rest, and not get drunk next time.
orev 4y ago
In the US, we have the unemployment insurance system that’s run by the government already. Isn’t this a government intervention that’s already there? What else should they be doing?
quickthrower2 4y ago
Depends on the hiring figures. Maybe they are mostly finding jobs elsewhere.
goostavos 4y ago
No.
zeroonetwothree 4y ago
The unemployment rate is at record lows. Layoffs are part of the natural economic cycle.
- bmitc 4y ago
  That ignores the problem that many H-1B holders will be forced to leave the country. It's in poor taste that these companies are doing this, as it could be the reason that a lot of solid talent leaves the U.S. The U.S. already lost a lot of talent during the pandemic.
  - riffraff 4y ago
    That sucks for everyone involved, but as long as GDP grows, wages grow, unemployment goes down, it seems hard for the government to justify intervention to protect "those pesky foreigners". Yeah this might come back to bite them in the arse in the future but from a political point of view it seems unfeasible to do otherwise.
  - Simon_O_Rourke 4y ago
    Totally agree, it's hard, but firing (or retaining) folks based on visa status is inherently unfair too. TBH, there should be some more reasonable period attached to most H-1B visas where holders are given six months to find a new job.
    - WirelessGigabit 4y ago
      They have 60 days. But in reality that's not enough. And even then, applying while under H-1B puts you in a difficult position. You don't have that much choice, as your denial might result being out of status. Not to mention that companies might take advantage from it.
      - heleninboodler 4y ago
        This might sound like a weird, blunt question, but what's the practical real world implication for an H-1B holder with a good financial situation (12-18 months of survival runway) but a family (spouse, kids in school), and who loses their visa due to losing their job? What actually happens at 60 days? Is there a possibility of just keeping quiet and hoping to find a job before their situation is exposed, or is this super risky in terms of being deported if found out? Could they head back to their home country and start a job search while leaving the family in the house/school in the US? Or are they literally risking their spouse and kids ending up in an immigration detention center somewhere? What is the likelihood of it all being OK if they end up finding a job but had a gap in their immigration status? What is the likelihood that a minor blip upends everything for an otherwise highly employable person?
- throwaway81523 4y ago
  There is low unemployment because huge numbers of people have left the workforce due to health issues (long covid etc). This is not cyclical.
  - KiranRao0 4y ago
    People have not left the labor force in the last few months. The labor force participation rate is still on a steady upward march since the initial lockdowns. Sources: Bureau of Labor Statistics https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm https://www.bls.gov/charts/employment-situation/civilian-lab...
- Yoric 4y ago
  Note that layoffs are global and low unemployment rate is US-specific.
  - _gvzl 4y ago
    It is not specific to the United States. In the Netherlands, the unemployment rate for some recent months has been the lowest since 2003.
    - Yoric 4y ago
      Interesting, thanks.
alanfranz 4y ago
I’m not US based. I don’t know about the social crisis, but if I were the US antitrust I’d take a look at whether a tech sector cartel exists to depress wages.
- readthenotes1 4y ago
  you mean another one? (they already busted one)
- jacknews 4y ago
  Right, it seems in late 2022 anyway, there were actually more hires than layoffs. None of the companies announcing layoffs appear to be struggling financially, in fact the opposite in many case. So this does have the look of a co-ordinated attempt to reign in wages, albeit very indirectly, and most likely coming from the Fed who have pretty much directly stated this is policy. Obviously the high wages in tech are an upward drag on all other wages, so it's logical to focus on this area.
  - paganel 4y ago
    > Obviously the high wages in tech are an upward drag on all other wages, so it's logical to focus on this area. If you're looking at it through Keynes's perspective there's not a lot of investment that the highly-paid tech workers actually carry out with their total comps, many of them just save most of it in view of early retirement. According to Keynes that's bad, it's just money left not doing anything in view of the famous accumulation. Supposedly, the money spent on those very high comps would be better spent by the companies themselves carrying out their own investments, and if not successful in doing that then those companies should return the money to the shareholders so that the latter would carry out their own investments. In either case, there would be higher chances of accumulation.
    - jacknews 4y ago
      Higher salary usually means higher spending, ie paying other people to work. It seems to me that is much better than 'investing' aka buying ownership of people's work. I mean, unless there's continual 'investment', someone has to actually pay for the work people do at some point, not just keep buying/paying for ownership of the work/profits they make.
geuis 4y ago
Where are you getting 1 million numbers from? There have been maybe 100k total layoffs from top companies being publicized. Even that is a fraction of the total numbers of engineers in the industry, if we spread out the definition alot and go LALALA with our fingers in our ears. Not dismissing 100k. That's a significant number and I hope everyone will be ok in the end.
- iExploder 4y ago
  based on https://layoffs.fyi/ https://layoffs.fyi/ seems like 1M is rly a bit too much
  - menaerus 4y ago
    According to the data from that website: - 2022 year - 1044 companies laid off 159786 employees - 2023 year - 334 companies laid off 101617 employees However, 637 out of 1795 of listings, which is 35%, is not part of this statistics because their "Laid Off" employees field is empty (0). For some reason, total sum of laid off employees is displayed as 358224, and even though that does not really match the reported 2022+2023 numbers, I could easily imagine that the actual figure crosses the 0.5M given that 30-40% of the listings are not included in math.
    - Yoric 4y ago
      Additionally, a number of companies have chosen to not communicate about their layoffs.
echelon 4y ago
These figures look pretty good to me: https://www.bls.gov/news.release/empsit.t01.htm https://www.bls.gov/news.release/empsit.t01.htm
readthenotes1 4y ago
Should the government have intervened when they were hiring too many people? Should the government intervene to have them more effectively use their personnel?
- throwaway81523 4y ago
  > Should the government have intervened when they were hiring too many people? It DID intervene. That's why we have the layoffs now.
jacknews 4y ago
I'd be very interested in a breakdown of the skills that are being laid off from 'tech', not only in terms of 'marketing', 'recruitment', 'management', 'engineering', 'massage', etc, but also for engineers, what skills eg 'junior', 'senior' 'frontend', 'backend', 'java', 'C++', etc.
bfung 4y ago
Sensationalist headline. proof please. According to layoffs.fyi, 2022+ytd 2023 is <260k. That’s 20k a month tops, 2 orders of magnitude off. According to bls, here are the unemployment numbers by month. https://www.bls.gov/news.release/empsit.t10.htm https://www.bls.gov/news.release/empsit.t10.htm
throwaway81523 4y ago
The gov is driving the layoffs with interest hikes. They WANT the layoffs.
LatteLazy 4y ago
The whole point of increasing interest rates is to force high unemployment and stop workers from negotiating better wages. Why would government suddenly intervene in its own policy?
db1234 4y ago
Powell is on record saying unemployment rate is too low for inflation to come down so no don't expect gov intervention.
- 420420420 4y ago
  I agree
drivebycomment 4y ago
The overall economy has record low unemployment. Tech layoffs are nowhere near 1M. Any direct intervention is likely to produce bad side effects that could be actually worse for everyone. Also, layoffs can be good for the overall economy than avoiding it, after the labor allocation is suboptimal. https://eig.org/dynamism/ https://eig.org/dynamism/ https://www.bls.gov/spotlight/2022/the-decline-in-employment-dynamism-over-the-last-three-decades/home.htm https://www.bls.gov/spotlight/2022/the-decline-in-employment... I fully expect these layoffs will provide necessary labor for the next generation of startups and smaller firms that will drive the future growth, just like dotcom crash did and the financial crisis did.
moomoo11 4y ago
Doubt it is necessary. But maybe the govt can hire these people to improve a bunch of the aging software we have. Pay them a decent salary + pension.
akmarinov 4y ago
The US economy added 500k jobs last quarter, so there isn’t really a social crisis
0xbadc0de5 4y ago
Government: if you think the problems we create are bad, wait until you see our solutions.

17 points by nothrowaways 4y ago

The cumulative number of layoffs in past two months alone is going to hit 1 million employees. Shouldn't the government intervene to prevent social crisis?

joaogfarias 4y ago

1 - "cumulative number of layoffs in past two months alone is going to hit 1 million employees" The state itself created this situation with the inflation since the end of Bretton Woods (specially the inflation during 2020-2021). If you give booze to an alcoholic he will get drunk and afterwards he will have a hangover. 2 - "Shouldn't the government intervene to prevent social crisis?" - Despite warning from people like Hayke and Mises, people tried to do all sorts of state-controlled economies (Germany, USSR, modern USA, etc). It didn't work. Better to drink lots of water, take a rest, and not get drunk next time.

orev 4y ago

In the US, we have the unemployment insurance system that’s run by the government already. Isn’t this a government intervention that’s already there? What else should they be doing?

quickthrower2 4y ago

Depends on the hiring figures. Maybe they are mostly finding jobs elsewhere.

goostavos 4y ago

No.

zeroonetwothree 4y ago

The unemployment rate is at record lows. Layoffs are part of the natural economic cycle.

bmitc 4y ago
That ignores the problem that many H-1B holders will be forced to leave the country. It's in poor taste that these companies are doing this, as it could be the reason that a lot of solid talent leaves the U.S. The U.S. already lost a lot of talent during the pandemic.
- riffraff 4y ago
  That sucks for everyone involved, but as long as GDP grows, wages grow, unemployment goes down, it seems hard for the government to justify intervention to protect "those pesky foreigners". Yeah this might come back to bite them in the arse in the future but from a political point of view it seems unfeasible to do otherwise.
- Simon_O_Rourke 4y ago
  Totally agree, it's hard, but firing (or retaining) folks based on visa status is inherently unfair too. TBH, there should be some more reasonable period attached to most H-1B visas where holders are given six months to find a new job.
  - WirelessGigabit 4y ago
    They have 60 days. But in reality that's not enough. And even then, applying while under H-1B puts you in a difficult position. You don't have that much choice, as your denial might result being out of status. Not to mention that companies might take advantage from it.
    - heleninboodler 4y ago
      This might sound like a weird, blunt question, but what's the practical real world implication for an H-1B holder with a good financial situation (12-18 months of survival runway) but a family (spouse, kids in school), and who loses their visa due to losing their job? What actually happens at 60 days? Is there a possibility of just keeping quiet and hoping to find a job before their situation is exposed, or is this super risky in terms of being deported if found out? Could they head back to their home country and start a job search while leaving the family in the house/school in the US? Or are they literally risking their spouse and kids ending up in an immigration detention center somewhere? What is the likelihood of it all being OK if they end up finding a job but had a gap in their immigration status? What is the likelihood that a minor blip upends everything for an otherwise highly employable person?
throwaway81523 4y ago
There is low unemployment because huge numbers of people have left the workforce due to health issues (long covid etc). This is not cyclical.
- KiranRao0 4y ago
  People have not left the labor force in the last few months. The labor force participation rate is still on a steady upward march since the initial lockdowns. Sources: Bureau of Labor Statistics https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm https://www.bls.gov/charts/employment-situation/civilian-lab...
Yoric 4y ago
Note that layoffs are global and low unemployment rate is US-specific.
- _gvzl 4y ago
  It is not specific to the United States. In the Netherlands, the unemployment rate for some recent months has been the lowest since 2003.
  - Yoric 4y ago
    Interesting, thanks.

alanfranz 4y ago

I’m not US based. I don’t know about the social crisis, but if I were the US antitrust I’d take a look at whether a tech sector cartel exists to depress wages.

readthenotes1 4y ago
you mean another one? (they already busted one)
jacknews 4y ago
Right, it seems in late 2022 anyway, there were actually more hires than layoffs. None of the companies announcing layoffs appear to be struggling financially, in fact the opposite in many case. So this does have the look of a co-ordinated attempt to reign in wages, albeit very indirectly, and most likely coming from the Fed who have pretty much directly stated this is policy. Obviously the high wages in tech are an upward drag on all other wages, so it's logical to focus on this area.
- paganel 4y ago
  > Obviously the high wages in tech are an upward drag on all other wages, so it's logical to focus on this area. If you're looking at it through Keynes's perspective there's not a lot of investment that the highly-paid tech workers actually carry out with their total comps, many of them just save most of it in view of early retirement. According to Keynes that's bad, it's just money left not doing anything in view of the famous accumulation. Supposedly, the money spent on those very high comps would be better spent by the companies themselves carrying out their own investments, and if not successful in doing that then those companies should return the money to the shareholders so that the latter would carry out their own investments. In either case, there would be higher chances of accumulation.
  - jacknews 4y ago
    Higher salary usually means higher spending, ie paying other people to work. It seems to me that is much better than 'investing' aka buying ownership of people's work. I mean, unless there's continual 'investment', someone has to actually pay for the work people do at some point, not just keep buying/paying for ownership of the work/profits they make.

geuis 4y ago

Where are you getting 1 million numbers from? There have been maybe 100k total layoffs from top companies being publicized. Even that is a fraction of the total numbers of engineers in the industry, if we spread out the definition alot and go LALALA with our fingers in our ears. Not dismissing 100k. That's a significant number and I hope everyone will be ok in the end.

iExploder 4y ago
based on https://layoffs.fyi/ https://layoffs.fyi/ seems like 1M is rly a bit too much
- menaerus 4y ago
  According to the data from that website: - 2022 year - 1044 companies laid off 159786 employees - 2023 year - 334 companies laid off 101617 employees However, 637 out of 1795 of listings, which is 35%, is not part of this statistics because their "Laid Off" employees field is empty (0). For some reason, total sum of laid off employees is displayed as 358224, and even though that does not really match the reported 2022+2023 numbers, I could easily imagine that the actual figure crosses the 0.5M given that 30-40% of the listings are not included in math.
  - Yoric 4y ago
    Additionally, a number of companies have chosen to not communicate about their layoffs.

echelon 4y ago

These figures look pretty good to me: https://www.bls.gov/news.release/empsit.t01.htm https://www.bls.gov/news.release/empsit.t01.htm

readthenotes1 4y ago

Should the government have intervened when they were hiring too many people? Should the government intervene to have them more effectively use their personnel?

throwaway81523 4y ago
> Should the government have intervened when they were hiring too many people? It DID intervene. That's why we have the layoffs now.

jacknews 4y ago

I'd be very interested in a breakdown of the skills that are being laid off from 'tech', not only in terms of 'marketing', 'recruitment', 'management', 'engineering', 'massage', etc, but also for engineers, what skills eg 'junior', 'senior' 'frontend', 'backend', 'java', 'C++', etc.

bfung 4y ago

Sensationalist headline. proof please. According to layoffs.fyi, 2022+ytd 2023 is <260k. That’s 20k a month tops, 2 orders of magnitude off. According to bls, here are the unemployment numbers by month. https://www.bls.gov/news.release/empsit.t10.htm https://www.bls.gov/news.release/empsit.t10.htm

throwaway81523 4y ago

The gov is driving the layoffs with interest hikes. They WANT the layoffs.

LatteLazy 4y ago

The whole point of increasing interest rates is to force high unemployment and stop workers from negotiating better wages. Why would government suddenly intervene in its own policy?

db1234 4y ago

Powell is on record saying unemployment rate is too low for inflation to come down so no don't expect gov intervention.

420420420 4y ago
I agree

drivebycomment 4y ago

The overall economy has record low unemployment. Tech layoffs are nowhere near 1M. Any direct intervention is likely to produce bad side effects that could be actually worse for everyone. Also, layoffs can be good for the overall economy than avoiding it, after the labor allocation is suboptimal. https://eig.org/dynamism/ https://eig.org/dynamism/ https://www.bls.gov/spotlight/2022/the-decline-in-employment-dynamism-over-the-last-three-decades/home.htm https://www.bls.gov/spotlight/2022/the-decline-in-employment... I fully expect these layoffs will provide necessary labor for the next generation of startups and smaller firms that will drive the future growth, just like dotcom crash did and the financial crisis did.

moomoo11 4y ago

Doubt it is necessary. But maybe the govt can hire these people to improve a bunch of the aging software we have. Pay them a decent salary + pension.

akmarinov 4y ago

The US economy added 500k jobs last quarter, so there isn’t really a social crisis

0xbadc0de5 4y ago

Government: if you think the problems we create are bad, wait until you see our solutions.