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Your explanation fails to answer why these same companies were hiring people at highly inflated salaries only a year ago, whereas the academic type explanation

Your explanation fails to answer why these same companies were hiring people at highly inflated salaries only a year ago, whereas the academic type explanation fully covers that scenario as well.

surfmike 4y ago
The argument was they saw positive returns for hiring additional people. Revenue grew as they added people. Did they go too far? Maybe. But being timid would have prevented them from growing as much as they did.
- dragontamer 4y ago
  Programmers don't create revenue when they are hired. There is a significant training period where programmers learn the local culture and quirks and tools. It takes a while before they can become effective. Once programmers are effective, it can take months or years or longer before a project they work on gets any significant revenue. --------- Consider all the money Facebook sank into the Metaverse, with nothing to show for it yet. Or consider the typical video game, that takes maybe 3+ years to go from programming into revenue. The 1 to 2 year hiring period from 2020 to 2022? I bet that most of these programmers did not create any revenue by the firing times of Q4 2022. It's just not how this industry works.
  - darkwater 4y ago
    > The 1 to 2 year hiring period from 2020 to 2022? I bet that most of these programmers did not create any revenue by the firing times of Q4 2022 That's why we fire them! /s
- ChuckNorris89 4y ago
  >The argument was they saw positive returns for hiring additional people. False. They saw positive returns because the market was rocketing up o matter what, which is why they over hired. That, and to signal to investors that "they're healthy and growing".
- whateveracct 4y ago
  haha show me a thousand-row spreadsheet attaching dollar amount returns to developers and other white collar positions and I'll show you a thousand confident lies.
matwood 4y ago
Copycat behavior? We go through all these weird gyrations to explain layoffs, but do nothing to explain the insane hiring that happened. And, even with these layoffs, the companies are still way above their employee count from as little as 12-24 months ago.
- sokoloff 4y ago
  People don’t go out of their way to root cause/introspect on things that benefit them.
- ryandrake 4y ago
  The insane hiring can also be explained by copycat behavior, as well as a lot more actions that companies take. This is always somehow an unpopular take on HN, but companies copy each other's behavior all the time. "They're hiring like crazy, do they know something? We must hire like crazy too!" "They just told the world they are working on AI. We must tell the world we're working on AI, too!" "They're returning everyone to the office. We must also return everyone to the office!" "They released feature X on their device. We must also work on feature X!" Everyone copies everyone because the sad truth is that most company leadership didn't become company leadership because they were particularly creative or original.
Cthulhu_ 4y ago
Shareholders look at metrics, numbers going up is what they want. Except in a downturn, then they want that particular number going down.
- anticensor 4y ago
  I think they would carefully calculate profits extracted per headcount and only hire sufficient employees to maximise profits and minimise liabilities (in all terms, not just in the immediate term). Why do they not do that?

Your explanation fails to answer why these same companies were hiring people at highly inflated salaries only a year ago, whereas the academic type explanation fully covers that scenario as well.

surfmike 4y ago

The argument was they saw positive returns for hiring additional people. Revenue grew as they added people. Did they go too far? Maybe. But being timid would have prevented them from growing as much as they did.

dragontamer 4y ago
Programmers don't create revenue when they are hired. There is a significant training period where programmers learn the local culture and quirks and tools. It takes a while before they can become effective. Once programmers are effective, it can take months or years or longer before a project they work on gets any significant revenue. --------- Consider all the money Facebook sank into the Metaverse, with nothing to show for it yet. Or consider the typical video game, that takes maybe 3+ years to go from programming into revenue. The 1 to 2 year hiring period from 2020 to 2022? I bet that most of these programmers did not create any revenue by the firing times of Q4 2022. It's just not how this industry works.
- darkwater 4y ago
  > The 1 to 2 year hiring period from 2020 to 2022? I bet that most of these programmers did not create any revenue by the firing times of Q4 2022 That's why we fire them! /s
ChuckNorris89 4y ago
>The argument was they saw positive returns for hiring additional people. False. They saw positive returns because the market was rocketing up o matter what, which is why they over hired. That, and to signal to investors that "they're healthy and growing".
whateveracct 4y ago
haha show me a thousand-row spreadsheet attaching dollar amount returns to developers and other white collar positions and I'll show you a thousand confident lies.

matwood 4y ago

Copycat behavior? We go through all these weird gyrations to explain layoffs, but do nothing to explain the insane hiring that happened. And, even with these layoffs, the companies are still way above their employee count from as little as 12-24 months ago.

sokoloff 4y ago
People don’t go out of their way to root cause/introspect on things that benefit them.
ryandrake 4y ago
The insane hiring can also be explained by copycat behavior, as well as a lot more actions that companies take. This is always somehow an unpopular take on HN, but companies copy each other's behavior all the time. "They're hiring like crazy, do they know something? We must hire like crazy too!" "They just told the world they are working on AI. We must tell the world we're working on AI, too!" "They're returning everyone to the office. We must also return everyone to the office!" "They released feature X on their device. We must also work on feature X!" Everyone copies everyone because the sad truth is that most company leadership didn't become company leadership because they were particularly creative or original.

Cthulhu_ 4y ago

Shareholders look at metrics, numbers going up is what they want. Except in a downturn, then they want that particular number going down.

anticensor 4y ago
I think they would carefully calculate profits extracted per headcount and only hire sufficient employees to maximise profits and minimise liabilities (in all terms, not just in the immediate term). Why do they not do that?