3 ms·

Ask HN: Why are big companies laying off employees?

3 points by mdwalters 4y ago

jzombie 4y ago
To save money I suppose, or reinvest that money in new technology. Case in point, the latest AI offerings by Microsoft and Google have supposedly increased costs by 10x, so perhaps they see layoffs as a way of offsetting those costs.
warning26 4y ago
I really enjoyed The Atlantic's take: > Shedding employees when everybody else is doing it avoids drawing public scrutiny to or creating reputational damage for a given firm (...) But if a firm downsizes when everyone else is doing it, the public seldom notices and investors seldom care https://www.theatlantic.com/ideas/archive/2023/02/why-are-layoffs-contagious/673021/ https://www.theatlantic.com/ideas/archive/2023/02/why-are-la...
- roncesvalles 4y ago
  Companies like Google and Microsoft had a reputation for being stable companies to work for and job seekers used to value that (= accept lower pay to join these over other offers). For such companies, the reputational harm is enormous, costly, and permanent. Meanwhile, Apple now holds the crown in this category and the labor market will reward them for it in the coming years.
  - catchnear4321 4y ago
    Companies like Google and Microsoft have done layoffs before, and will do layoffs again. “Stable company to work for throughout your career” died with pensions. Maybe this will be the death of “rest and vest,” which would be welcome.
swatcoder 4y ago
Because they have cover to do so now. The game for the last several years was to hoover as much talent as possible to prevent competitors from beating you to it, even if you ended up with more people than useful work and even if you ended up with a lot of poor performers. And during that phase, it hurts further recruiting to let anyone go because you look like the singularly bad actor. The boats were all out trawling for whatever they'd catch. Now, the perception of a turned economy and tightening money supply has let everybody finally exhale and start purging and pruning without a targeted reputation hit because everybody's doing it. The boats are back in harbor and are sorting through their take. If this is your first time around, welcome to the industry!

3 points by mdwalters 4y ago

To save money I suppose, or reinvest that money in new technology. Case in point, the latest AI offerings by Microsoft and Google have supposedly increased costs by 10x, so perhaps they see layoffs as a way of offsetting those costs.

warning26 4y ago

I really enjoyed The Atlantic's take: > Shedding employees when everybody else is doing it avoids drawing public scrutiny to or creating reputational damage for a given firm (...) But if a firm downsizes when everyone else is doing it, the public seldom notices and investors seldom care https://www.theatlantic.com/ideas/archive/2023/02/why-are-layoffs-contagious/673021/ https://www.theatlantic.com/ideas/archive/2023/02/why-are-la...

roncesvalles 4y ago
Companies like Google and Microsoft had a reputation for being stable companies to work for and job seekers used to value that (= accept lower pay to join these over other offers). For such companies, the reputational harm is enormous, costly, and permanent. Meanwhile, Apple now holds the crown in this category and the labor market will reward them for it in the coming years.
- catchnear4321 4y ago
  Companies like Google and Microsoft have done layoffs before, and will do layoffs again. “Stable company to work for throughout your career” died with pensions. Maybe this will be the death of “rest and vest,” which would be welcome.

swatcoder 4y ago

Because they have cover to do so now. The game for the last several years was to hoover as much talent as possible to prevent competitors from beating you to it, even if you ended up with more people than useful work and even if you ended up with a lot of poor performers. And during that phase, it hurts further recruiting to let anyone go because you look like the singularly bad actor. The boats were all out trawling for whatever they'd catch. Now, the perception of a turned economy and tightening money supply has let everybody finally exhale and start purging and pruning without a targeted reputation hit because everybody's doing it. The boats are back in harbor and are sorting through their take. If this is your first time around, welcome to the industry!