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Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order

Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order of magnitude more resources to hire and fire? I was under the impression that flexibility was one of the big reasons for TVC use, much easier to scale up or down, akin to cloud computing resources. I suppose the lack of TVC scale-down at companies like Google is yet another indication that layoffs aren't a financial necessity or even a best practice; it's just the hot market signal to show investors that you're serious about "battening down the hatches" for "economic downturn."

deleted 4y ago
[deleted]
sjamaan 4y ago
Probably because a TVC that doesn't pull its weight will be let go right away. I suspect that the "economic downturn" is just an excuse to trim the fat. Also note the wording in OP: these are "non-billable corporate functions". ie middle management and such.
etempleton 4y ago
I suspect they are, but typically TVC is on an annual or project based contract so they might choose not to renew once the terms are up. Also ending a contract agreement won’t make headlines so we probably just aren’t hearing about it as much.
tablespoon 4y ago
> Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order of magnitude more resources to hire and fire? > I was under the impression that flexibility was one of the big reasons for TVC use, much easier to scale up or down, akin to cloud computing resources. I think many companies use them for flexibility, but my impression is that social media companies (of which Google is one) have other reasons, such as protecting their FTEs from the soul-killing aspects of content moderation.
alephnerd 4y ago
They did. There have been a bunch of articles on HN back in early 2022 about TVC layoffs. That was also when the whole "let's unionize google contractors" thing started happening.
908B64B197 4y ago
> Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order of magnitude more resources to hire and fire? They do all the time with simply not renewing contracts. TVC are also generally assigned to support a product or group of devs so they typically come and go with the product.
readthenotes1 4y ago
Iirc, employees are operating expenses and TVC can be capital expenses. One apparently looks better than the other. Also, employees in the USA can be very expensive because of company benefits (mostly health care) costs. Finally, it is not unusual for employees to be less motivated and/or capable than contractors. I've been at a few places where employees where dropped before contractors...
- arbitrary_name 4y ago
  What? There's no way to classify vendor or contractor spend as capex. The reason they are used is for tasks that are repetitive, or with no career progression, or that may not be needed long term. Your comment about cost is correct as well.
arbitrary_name 4y ago
As a faang employee who works with lots of contractors: we did. We've cut millions of dollars of vendors and contractors. Everywhere. It's just not making headlines.
netheril96 4y ago
I presume that they have already scaled back TVC usage. But it doesn't make news because it isn't interesting to anyone.

deleted 4y ago

[deleted]

sjamaan 4y ago

Probably because a TVC that doesn't pull its weight will be let go right away. I suspect that the "economic downturn" is just an excuse to trim the fat. Also note the wording in OP: these are "non-billable corporate functions". ie middle management and such.

etempleton 4y ago

I suspect they are, but typically TVC is on an annual or project based contract so they might choose not to renew once the terms are up. Also ending a contract agreement won’t make headlines so we probably just aren’t hearing about it as much.

tablespoon 4y ago

> Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order of magnitude more resources to hire and fire? > I was under the impression that flexibility was one of the big reasons for TVC use, much easier to scale up or down, akin to cloud computing resources. I think many companies use them for flexibility, but my impression is that social media companies (of which Google is one) have other reasons, such as protecting their FTEs from the soul-killing aspects of content moderation.

alephnerd 4y ago

They did. There have been a bunch of articles on HN back in early 2022 about TVC layoffs. That was also when the whole "let's unionize google contractors" thing started happening.

908B64B197 4y ago

> Does anyone know why the big companies didn't scale back their TVC (Temporary, Vendor or Contractor) usage before laying off full-time staff that take an order of magnitude more resources to hire and fire? They do all the time with simply not renewing contracts. TVC are also generally assigned to support a product or group of devs so they typically come and go with the product.

readthenotes1 4y ago

Iirc, employees are operating expenses and TVC can be capital expenses. One apparently looks better than the other. Also, employees in the USA can be very expensive because of company benefits (mostly health care) costs. Finally, it is not unusual for employees to be less motivated and/or capable than contractors. I've been at a few places where employees where dropped before contractors...

arbitrary_name 4y ago
What? There's no way to classify vendor or contractor spend as capex. The reason they are used is for tasks that are repetitive, or with no career progression, or that may not be needed long term. Your comment about cost is correct as well.

arbitrary_name 4y ago

As a faang employee who works with lots of contractors: we did. We've cut millions of dollars of vendors and contractors. Everywhere. It's just not making headlines.

netheril96 4y ago

I presume that they have already scaled back TVC usage. But it doesn't make news because it isn't interesting to anyone.