20 ms·

Thoughts on tech employment

167 points by luu 3y ago

okdood64 3y ago
> There’s been a weird accounting thing where companies put a lot of their compensation into equity, but I think that’s going away as investors are learning to better account for dilution and employees appreciate the fungibility of cash. Interesting, is there any public data to support this?
maximinus_thrax 3y ago
As a piece of general feedback regarding the writing, I believe the use of the term 'leveraged' (5 times) is overleveraged.
- djur 3y ago
  I genuinely don't know what "leveraged" is meant to mean here: > Tech-first companies are going to become leaner and more leveraged. To me, a company being "leveraged" means they're in debt. I'm pretty sure that's not what he means?
  - maximinus_thrax 3y ago
    I spend a lot of time talking to PMs and I believe people throw this word around like some sort of MBA gang sign. Whenever I hear it, I know I will be interacting with a bullshit artist. But to your point, I believe the definition for this context is: > lev·er·age: use (something) to maximum advantage.
  - deleted 3y ago
    [deleted]
CSMastermind 3y ago
There are some obvious things missing from here. I believe the prevailing wisdom is that tech hiring slowed because interest rates rose. Because software scales so well, it benefits from speculative effort more than other business types. We see this in venture capital, where they only need 1 out of 100 bets to hit in order to make their money. Large tech companies do something similar internally. They may fund the development of 100 products or features, knowing they only need one of them to hit big in order to fund the company going forward. When money was essentially free to borrow, it made all the sense in the world to make a large number of bets because the odds were on your side that at least one of them would pay off. Now, however, each bet comes with a real opportunity cost, so companies are making fewer speculative bets and thus need fewer people. --- The other thing he doesn't talk about is the rise of remote work and the downward pressure that it puts on wages. I know that many companies are forcing employees to return to the office, but I'd speculate that the number of remote workers has risen significantly. And that opens up the labor market pretty significantly. I'll tell you that I'm getting overseas talent for roles where 10 years ago I would have hired entry level talent in the US. But since my company is fully remote and distributed, the downside to hiring in LatAm and Eastern Europe has been significantly reduced.
- garrickvanburen 3y ago
  I fully agree. Low interest rates mean companies/capital-providers look to speculative places (like new software products) to hit their growth numbers. Higher interest rates mean companies/capital-providers return to known/well-understood places to hit their growth numbers. I interpret the reasons in the article as well downstream from these kinds of investment decisions.
  - jsdwarf 3y ago
    Have a slightly different view. In times of high interest rates, you are rewarded for profitability, not for growth. When interest rates are low, your company needs to grow or it will be outgrown by its competitors and becomes a takeover target. With high interest rates unprofitable companies (which is a side effect of a growth strategy) slowly bleed to death and become takeover targets by themselves.
    - garrickvanburen 3y ago
      Yes, thank you for distinguishing between profitability and growth.
  - deleted 3y ago
    [deleted]
- AznHisoka 3y ago
  Which countries in Eastern Europe and Latin America do you find most of your talent?
  - jodacola 3y ago
    Not parent, but I’ve hired and worked with a lot of great folks from Argentina, Romania, and Ukraine. Other countries from which I’ve hired fewer, but generally solid, folks are Spain, Poland, Columbia, and Costa Rica. Usually as contractors. Full-time employment laws in other countries are very, very different from the US.
wetpaws 3y ago
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jawns 3y ago
> At Automattic last year we did not do layoffs, but allowed performance management and natural attrition (voluntary regrettable was 2.9%, non-regrettable 6.8% for us in 2023) to allow our size to shrink down more naturally "Non-regrettable" attrition means either that the person was fired or laid off. Since the post says Automattic didn't do layoffs, that means all of that attrition took the form of being fired because of performance problems. If 7% of the company exited the company in a year because they were fired -- which seems quite high to me -- then even if you don't call it a layoff, it has many of the same characteristics as a layoff. In a classic layoff situation, you've over-hired, expecting future growth, and then the winds change, and you need to reduce the workforce to match the declining growth. In a case where you're firing 7% of the company because of performance problems, you haven't over-hired, but you have certainly poorly hired! Either way, now the remaining workforce has to adjust and "do more with less," and I'm going to guess that most of them have a reasonable fear that they might be next on the chopping block!
- jyap 3y ago
  Not necessarily. Depends on their definition and process. “Voluntary regrettable” would imply the employee left voluntarily but regrettable because the company would have preferred they stayed. “Non-regrettable” means they left for reasons that aren’t regrettable such as performance or natural attrition. Either they left on their own or were fired. Hard to say since they don’t specify.
  - malfist 3y ago
    Typically "regretted attrition" is employee managed. "Unregretted attrition" is employeer managed. Regardless of the cause.
    - elevatedastalt 3y ago
      Regretted attrition == The employee left and the employer regrets it (They would have wanted the employee to stay) Unregretted attrition == The employee left and the employer is glad they did. Good riddance.
twelfthnight 3y ago
People talk about efficiency a lot, but they miss the basic point that efficiency in a free market means lower prices and decreased profits (due to competition). Companies profits are soaring. Folks upset about lay offs are not against that type of efficiency, they are against bad faith arguments that's it's cool for leaders to make money on short term gains (fire staff) while paying no costs for long term losses.
- lex-lightning 3y ago
  I was laid off along with a quarter of staff last year. If I’m being honest, all of these are true: - I had life circumstances making me depressed and I get why I was included. - Multiple projects I spent over a month on were just thrown away casually when management changed their mind. So I was being paid without creating value. - I don’t think tech workers are overpaid per se, but most people are underpaid given the effort they put in or conditions they work in. Even as I made great money as a tech worker, I was acutely aware that I wasn’t providing value to society. Or even arguably the company, even when I tried. My favorite Orwellian phrase is “Human Resources”. In a publically traded company, headcount is another number to advertise in the game of stock evaluation. People themselves become speculative assets. I still benefited from this system and most people in the US have it worse than I do. That said, I find the expansion-layoff cycle icky.
  - jodacola 3y ago
    > headcount is another number to advertise in the game of stock evaluation This is something I've had difficulty squaring over the course of my career. If a company remains small but makes boatloads of money because it builds a superior product, shouldn't that be rewarded more than having a higher headcount? From the perspective of having run engineering orgs (and a few failed - but enlightening - forays into founding a company), I've learned to believe from my experience that having the smallest team reasonable to achieve great things brings the most positive effects: folks are closer to the outcome, feel a stronger sense of ownership, want the best for the business, and reap the rewards of accomplishment, which in turn motivates the team to achieve and innovate more, resulting in growing revenue for the company. If I were an investor, I'd want smaller teams producing outsized results. Why would I want a gigantic team producing mediocre results?
ptero 3y ago
A few of those thoughts I completely agree on: results of overhiring, and technology enabling bigger impact by fewer people seem spot on to me. But a few I find strange. For example, a semi-implicit assumption that hiring, profits and stock price are tightly coupled. That is not always the case. They are correlated, but often have significant time lags, so it is possible for a company to hire rapidly on a great novel idea, realize a first mover advantage, have it lead to profits, have that lead to a stock rise by which time there is no longer a need for aggressive hiring. The company does not even need to do layoffs, just a stop to aggressive hiring is enough to feel a frozen job market. Edited: apparently I totally misunderstood the meaning of the "non-regrettable attrition". Is the only difference with a layoff is firing employees one-at-a-time vs en masse?
- csa 3y ago
  > Is the only difference with a layoff is firing employees one-at-a-time vs en masse? Theoretically, layoffs are not performance-related, although sometimes they are. Getting laid off doesn’t necessarily reflect poorly on the person who was laid off. Firing is performance-related, and it’s usually a bad look. The former may get severance and will probably be eligible for unemployment, while the latter will likely get neither.
  - ptero 3y ago
    Are you sure about the unemployment? Given that it is usually administered by the state (at least in the US) I am surprised that any non-criminal involuntarily termination would be rejected for the unemployment benefits. But IANAL and personally never needed one, so anything is possible.
    - csa 3y ago
      > Are you sure about the unemployment? Definitely not sure, and it probably varies based on location. In CA, where I am, one criterion is “unemployed through no fault of [their] own”. Getting fired is widely considered to be the individual’s fault (e.g., non-performance). I’ve heard something about the standard being “egregious misconduct”, but that’s just beyond the details that I know about. Getting laid off usually isn’t considered the employee’s fault (e.g., due to lack of work or change in direction). Iirc, companies might have increased payments into the state unemployment coffers when they do layoffs versus firings. I have only heard about this second-hand, so I don’t know the details. Anecdotally and perhaps only tangentially related, I have friends and family who have had to or chosen to fire people, and they have all said the same thing — layoffs are much easier than firings.
nonrandomstring 3y ago
> Sam Altman when he says there may someday be a billion-dollar company run by one person who is able to highly leverage future AI agents to automate most traditional roles at a company. Altman is nearly right, but Warren Bennis had it better; The factory of the future will have only two employees, a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment. It's not that companies will "leverage AI" but that AI will leverage humans. Companies are already "AIs", but that will become more and more apparent as time goes by.
- hef19898 3y ago
  Yeah, neither of those things is going to happen in our lifetimes. Regardless of what Altman says.
  - nonrandomstring 3y ago
    Play the game "Flateye" [0,1]and come back to us on that :) [0] https://flateye-game.com/ https://flateye-game.com/ [1] https://www.youtube.com/watch?v=5HdYFdcfdXk https://www.youtube.com/watch?v=5HdYFdcfdXk
    - hef19898 3y ago
      Try flat eye at managing a factory, and come back to tell me how it went. A game as a reference, seriously? No idea which film I recently heard the term, but amateur hour doesn't even come close to decribe that...
      - nonrandomstring 3y ago
        Did you just actually take me giving you a joke game as a "reference" seriously? I'm not sure what worries me the most now.
        hef19898 3y ago
        Unfortunately, I cannot tell anymore sometimes... As a joke, it is right down my alley! So please, take my apology.
darkerside 3y ago
When there is a one person $1B company someday, which I think is very possible, I believe it will come after a series of events that will make it obvious that such a thing could exist. For example, the existence of several multi trillion dollar market cap companies, plethoras of small companies worth several billion dollars, and probably a radical rethinking of compensation and capitalism in the economy.
- hef19898 3y ago
  One billion as in VC-pre dumb money round valuations? VCs, and Altman, would love that!
- williamDafoe 3y ago
  Probably the guy who masters how to make realtime interactive porn with AI will be the first $1 billion sole proprieter ... Don't laugh YouTube already has hundreds of StableDiffusion channels uploading MANY videos a day ..
  - CoastalCoder 3y ago
    He'd also probably win some Nobel prize for addressing human overpopulation. I feel bad for any normal human who needs to compete for affection against a future, hyper-optimized AI sexbot.
- no_wizard 3y ago
  I think WhatsApp stands out here, as they had 55 people employed when they were acquired for 19 Billion in 2014. I know it was mostly stock but given how things played out, that means it was worth even more as it were (Meta stock only rose from that time period onward, for the most part) We're already starting to see this become more and more possible with fewer and fewer people.
romanzubenko 3y ago
Did anyone perform an analysis on where the laid off employees for last 3 years went? According to layoffs.fyi nearly 500k were laid off since 2021, would be interesting to see if people mostly reshuffled within FAANG or there was a more structural talent migration e.g. from megacorps to startups.
- UncleOxidant 3y ago
  And how many haven't landed anywhere yet.
  - ok_dad 3y ago
    And after ~12 months or so, they are removed from the "unemployment" numbers as "no longer looking for work" so that the numbers look better. ref: https://www.bls.gov/cps/cps_htgm.htm#nilf https://www.bls.gov/cps/cps_htgm.htm#nilf
    - kibwen 3y ago
      No, you still count as unemployed even if you haven't had a job for 12 months, as your own link attests. The question is whether you've looked for a job at any point in the past year, not whether you've held one. More broadly, the US government publishes six different measures of unemployment, all of which can be seen here: https://www.bls.gov/news.release/empsit.t15.htm https://www.bls.gov/news.release/empsit.t15.htm . The media usually focuses on U-3 (currently 3.7%), whereas the broadest metric is U-6 (currently 7.2%).
      - ok_dad 3y ago
        Your comment us needlessly pedantic, as I linked the full answer and said “~12 months” which is “about twelve months” which is not incorrect, though I’m sure the average is probably closer to 18-20 months for being removed from the U3 stat.
  - ghaff 3y ago
    Or didn't seriously try to. I know people who almost certainly did pretty well over the past 15 years or so, got caught up in some layoff, and retired or semi-retired--probably a few years earlier than they would have done in different circumstances.
UncleOxidant 3y ago
> Some of this productivity gains just come from adoption of existing tools like Google Workspace or Office 365, issue trackers and version control with tools like Gitlab, Github, or Jira I guess I haven't seen Jira be something that actually improves productivity. More often it seems to be a productivity suck.
- acdha 3y ago
  I’ve usually found that to be a symptom rather than the root cause: if Jira is turning into a job rather than a tool to do your job, switching tools without switching managers won’t change much.
- marcosdumay 3y ago
  Office applications (spreadsheets excluded) also look like a tremendous productivity sink to me. Anyway, the answer the article is looking for seems very clear to me. The informatics companies got into a hiring scare recently, and are trying to undo it with a firing scare. Those companies appear to be run by bozos, and trying to look into theoretical fundamentals for their behavior is a fools errand.
  - kelnos 3y ago
    Consider the old-school alternatives, though. Before we had computers, we had electronic word processors. They were a step up from typewriters, but computers made creating and editing documents so much easier and streamlined. No need to retype from scratch if there are errors that require too much correction fluid/tape, or if you need to add or remove or rearrange paragraphs. And then pushing that further, putting the documents online in a way that allows for easier collaboration, means no more sending .doc files through email and keeping track of who has made what changes, and merging everything into a final document, manually. As much as we all despise the stereotypical PowerPoint presentation, these sorts of apps let you create presentation material without expending too much effort. Otherwise you're creating poster boards by hand, or typing something up and photocopying it, or creating some kind of overhead projection thing. Collaboration is again so much easier.
divbzero 3y ago
> At tech companies some roles are highly leveraged… These leveraged roles can create enormous amounts of value, but the unlock in technology can come from a single person, a single insight. This core idea about tech employees having high leverage is spot on. It not only results in the high compensation that tech enjoys at the moment, but also explains why attrition and layoffs are a part of the process. Companies with a lot to gain from technology are willing to throw money into hiring, but are simultaneously figuring out which roles are actually paying off and which ones aren’t.
dogman144 3y ago
I’m a security engineer, so my work is a bit different than SWE - data wrangling and analysis, tying systems together and correlating events across them, building defense in depth, cool and effective under stress. That said, LLMs are showing up a lot in my job. Being a good sec eng is having a 70% base in most systems, solid comp sci and programming chops (I call it I can build and run a mediocre app), and solid security expertise. GPT is really good at radically speeding up how to get past the 70% starting point I usually operate from. I run (sanitized) terminal output through it so the 60% of the output I table to RTFM later to understand, I can understand immediately via GPT. Sec eng benefits a lot from leaning into pandas/notebooks vs log csvs, and GPT does that really well too. The big marker for me is incident response - standardized tech data requiring analysis and correlating in a pinch. I’m going to have an incident response LLM partner soon enough. Analyzing open source codebases for how they do input sanitizing with a new to me language? LLM partner walking me through. All this together - goodbye entry level cybersecurity jobs in a few years I think. Many of the things you’d need a security analyst for or the more busy work sec eng 1 jobs I truly think are turning into LLM jobs. My lived experience this past year reflects it. I think layoffs, and productivity gains from LLMs are under the hood of tech layoff tight now. Curious if other engineering tracks are seeing this though? A SWE buddy at Google thinks so.
- MattGaiser 3y ago
  Entry level devs will need to be much more skilled than I was to enter the field a few years ago. My internships and the first 6 months of my first full time job are trivial to ChatGPT. Copilot would be needed for work since then (as it is specific to the codebase), but even so, I am far more productive with them. One of my first internships was hacking together a mobile demo of a digital ID concept. I’d be surprised if it took more than a few hours to replicate a month of vanilla HTML/CSS/JS effort from back then. I would prefer ChatGPT to me as a co-worker up until about 1.5 years of experience, if simply because it replies instantly and doesn't forget stuff.
  - shrimp_emoji 3y ago
    New devs' code looks like ChatGPT wrote it if it had been trained on pre-existing parts of the codebase. Copy pasta eeeverywhere :p
elliotto 3y ago
Does this article actually say anything? It seems like a tech bro founder who laid off 7% of his staff rambling and everyone eats it up for some reason? Don't forget the a16z quote because we aren't done shilling crypto
kj4211cash 3y ago
There are a lot of posts claiming that advances in technology over the past decade or two have been leading to "productivity gains". But the economic data simply doesn't support these claims. Productivity growth has stalled in most of the developed world. I like the way tech companies operate. I like slack. We don't use P2 but it looks interesting. I just don't really believe it'll turbo charge productivity at my company, much less at a more traditional company. I'm going to avoid saying anything one way or the other about AI because that would be a separate argument.
deadbabe 3y ago
Paying less for an engineer in a low cost of living area may save you money in the short term but will wound you in the long term if you value employee retention. If you have a truly skilled engineer paid cheaply, it’s trivial for a large company from a high cost of living area to offer them a 20% salary bump and snatch them away. Good luck if that employee had valuable insight into company processes.
yedava 3y ago
I don't think productivity gains explain why companies need fewer people to be employed. A better explanation is that tech companies have grown too big. They've established big enough moats to prevent competition from arising, and if for some reason competition did arise, they can just be bought out. So we have something like a monopoly/oligopoly situation where companies are in a rent seeking phase and don't need as many employees as before when they were in a value producing phase.
- alephnan 3y ago
  > I don't think productivity gains explain why companies need fewer people to be employed Right. If these productivity gains actually scaled, then why not add more people?
deleted 3y ago
[deleted]
webosdude 3y ago
May be time for Unionization in Tech to stabilize things and protect tech workers? There is already unionization in some parts of Europe.
- williamDafoe 3y ago
  Unions only work in locations where capital is immobile and the labor to operate the capital is immobile. Tech labor is the most mobile on earth ...
  - meowtimemania 3y ago
    I'm dumb, why do unions only work where capital/labor is immobile?
    - thedevilslawyer 3y ago
      Because the capital is immobile (can't move) from the labor. When it is mobile, it moves away from the union, to a place without union.
williamDafoe 3y ago
In my experience, the USA is shitting on its entry-level engineers. I know 3 junior engineers unemployed 6 months after graduation, from top 20 to top 40 schools. They have 10 total internships among them. One had a zoom, corp job with 24/7 hours they had no life and quit. One had their offer rescinded 4 weeks before start date. One had their position cancelled 60d after start date. All are now longterm unemployed with virtually no interviews. Meanwhile overseas hiring and 85k H1B workers are flooding the job markets annually, its galling ...
- hn_throwaway_99 3y ago
  As the top comment says, this is sadly a consequence of remote working. I started my career in the dot com boom a quarter century ago, and when it burst there was initially a huge rush of fear that "everything will be outsourced to India and China". That never really panned out, primarily because (a) teleconferencing tech wasn't nearly as good as it is now, and (b) the huge timezone differences were an absolute killer for productivity, especially in a world that discovered things like fast cycle times and continuous deployment were a critical competitive advantage. Now, though, I think a lot of companies have learned from those problems. I see much more outsourcing to places like Latin America (same or nearly same timezone) or Eastern Europe (obv. not as good timezone overlap but still doable if you have US workers start a bit earlier than usual and European a bit later). Also, since nearly everyone, even in "RTO" offices, spends a huge amount of time on Zoom, etc., it's much easier to have outsourced workers treated as fully equal team members. I agree, it totally sucks for US entry-level devs. Based on my experience in the US of how we outsourced other previously critical competencies, I don't have a good answer.
- charred_patina 3y ago
  Class interests supersede national interests.
bilsbie 3y ago
I’ve noticed salaries haven’t kept up with inflation from the last four years. Could that be playing a role? Maybe companies realizing they can’t attract employees with their budgets so they don’t bother hiring?
Anastesia67 3y ago
[flagged]
atduskgreg 3y ago
Another obvious cause I don’t see anyone mentioning: tech simply created a lot less value in the last decade than in any previous decade. Pretty much every one of the big hyped up technologies that was going to be the future of everything turned out to be a bust: IoT, drones, cryptocurrencies, NFTs, and on and on. Even the ones that got some traction like ride sharing really were just castles of smoke floated on giant clouds of dumb middle eastern and Asian venture capital money looking for a greater fool. Most of the changes in web development tech have made software slower and more bureaucratic to make in order to support large FAANG-style software orgs. There was absolutely nothing remotely on the scale of the smartphone, social media, the web, the personal computer, etc from previous decades in terms of actually creating real value for users. Today’s tech industry deserves to shrink.
IamLoading 3y ago
That said, after working with small teams. I observed Its kind of hard to maintain all team member enthusiasm and drive without feeling like getting burnt out.
AntiRemote 3y ago
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cyka_privet 3y ago
FYI, Automattic has lost more headcount in 2023 (proportionally and in absolute terms) than some companies that had public layoffs. I know of several cases where individuals receiving stellar reviews were suddenly fired for “performance reasons”. Call it what you want, Automattic has been doing stealth layoffs and it is disingenuous to pretend it has not been.
deleted 3y ago
[deleted]
alephnan 3y ago
> Some of this (tech industry) productivity gains just come from adoption of existing tools like Google Workspace or Office 365, issue trackers and version control with tools like Gitlab, Github, or Jira. Why would other industries need version control with tools like Gitlab, Github, or Jira. These tools exist to solve complexity problems that arise in software. They aren't making the tech industry more productive then others. If anything, it's a huge red flag if a company is a little too obsessed with Jira.

167 points by luu 3y ago

> There’s been a weird accounting thing where companies put a lot of their compensation into equity, but I think that’s going away as investors are learning to better account for dilution and employees appreciate the fungibility of cash. Interesting, is there any public data to support this?

maximinus_thrax 3y ago

As a piece of general feedback regarding the writing, I believe the use of the term 'leveraged' (5 times) is overleveraged.

djur 3y ago
I genuinely don't know what "leveraged" is meant to mean here: > Tech-first companies are going to become leaner and more leveraged. To me, a company being "leveraged" means they're in debt. I'm pretty sure that's not what he means?
- maximinus_thrax 3y ago
  I spend a lot of time talking to PMs and I believe people throw this word around like some sort of MBA gang sign. Whenever I hear it, I know I will be interacting with a bullshit artist. But to your point, I believe the definition for this context is: > lev·er·age: use (something) to maximum advantage.
- deleted 3y ago
  [deleted]

CSMastermind 3y ago

There are some obvious things missing from here. I believe the prevailing wisdom is that tech hiring slowed because interest rates rose. Because software scales so well, it benefits from speculative effort more than other business types. We see this in venture capital, where they only need 1 out of 100 bets to hit in order to make their money. Large tech companies do something similar internally. They may fund the development of 100 products or features, knowing they only need one of them to hit big in order to fund the company going forward. When money was essentially free to borrow, it made all the sense in the world to make a large number of bets because the odds were on your side that at least one of them would pay off. Now, however, each bet comes with a real opportunity cost, so companies are making fewer speculative bets and thus need fewer people. --- The other thing he doesn't talk about is the rise of remote work and the downward pressure that it puts on wages. I know that many companies are forcing employees to return to the office, but I'd speculate that the number of remote workers has risen significantly. And that opens up the labor market pretty significantly. I'll tell you that I'm getting overseas talent for roles where 10 years ago I would have hired entry level talent in the US. But since my company is fully remote and distributed, the downside to hiring in LatAm and Eastern Europe has been significantly reduced.

garrickvanburen 3y ago
I fully agree. Low interest rates mean companies/capital-providers look to speculative places (like new software products) to hit their growth numbers. Higher interest rates mean companies/capital-providers return to known/well-understood places to hit their growth numbers. I interpret the reasons in the article as well downstream from these kinds of investment decisions.
- jsdwarf 3y ago
  Have a slightly different view. In times of high interest rates, you are rewarded for profitability, not for growth. When interest rates are low, your company needs to grow or it will be outgrown by its competitors and becomes a takeover target. With high interest rates unprofitable companies (which is a side effect of a growth strategy) slowly bleed to death and become takeover targets by themselves.
  - garrickvanburen 3y ago
    Yes, thank you for distinguishing between profitability and growth.
- deleted 3y ago
  [deleted]
AznHisoka 3y ago
Which countries in Eastern Europe and Latin America do you find most of your talent?
- jodacola 3y ago
  Not parent, but I’ve hired and worked with a lot of great folks from Argentina, Romania, and Ukraine. Other countries from which I’ve hired fewer, but generally solid, folks are Spain, Poland, Columbia, and Costa Rica. Usually as contractors. Full-time employment laws in other countries are very, very different from the US.

wetpaws 3y ago

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jawns 3y ago

> At Automattic last year we did not do layoffs, but allowed performance management and natural attrition (voluntary regrettable was 2.9%, non-regrettable 6.8% for us in 2023) to allow our size to shrink down more naturally "Non-regrettable" attrition means either that the person was fired or laid off. Since the post says Automattic didn't do layoffs, that means all of that attrition took the form of being fired because of performance problems. If 7% of the company exited the company in a year because they were fired -- which seems quite high to me -- then even if you don't call it a layoff, it has many of the same characteristics as a layoff. In a classic layoff situation, you've over-hired, expecting future growth, and then the winds change, and you need to reduce the workforce to match the declining growth. In a case where you're firing 7% of the company because of performance problems, you haven't over-hired, but you have certainly poorly hired! Either way, now the remaining workforce has to adjust and "do more with less," and I'm going to guess that most of them have a reasonable fear that they might be next on the chopping block!

jyap 3y ago
Not necessarily. Depends on their definition and process. “Voluntary regrettable” would imply the employee left voluntarily but regrettable because the company would have preferred they stayed. “Non-regrettable” means they left for reasons that aren’t regrettable such as performance or natural attrition. Either they left on their own or were fired. Hard to say since they don’t specify.
- malfist 3y ago
  Typically "regretted attrition" is employee managed. "Unregretted attrition" is employeer managed. Regardless of the cause.
  - elevatedastalt 3y ago
    Regretted attrition == The employee left and the employer regrets it (They would have wanted the employee to stay) Unregretted attrition == The employee left and the employer is glad they did. Good riddance.

twelfthnight 3y ago

People talk about efficiency a lot, but they miss the basic point that efficiency in a free market means lower prices and decreased profits (due to competition). Companies profits are soaring. Folks upset about lay offs are not against that type of efficiency, they are against bad faith arguments that's it's cool for leaders to make money on short term gains (fire staff) while paying no costs for long term losses.

lex-lightning 3y ago
I was laid off along with a quarter of staff last year. If I’m being honest, all of these are true: - I had life circumstances making me depressed and I get why I was included. - Multiple projects I spent over a month on were just thrown away casually when management changed their mind. So I was being paid without creating value. - I don’t think tech workers are overpaid per se, but most people are underpaid given the effort they put in or conditions they work in. Even as I made great money as a tech worker, I was acutely aware that I wasn’t providing value to society. Or even arguably the company, even when I tried. My favorite Orwellian phrase is “Human Resources”. In a publically traded company, headcount is another number to advertise in the game of stock evaluation. People themselves become speculative assets. I still benefited from this system and most people in the US have it worse than I do. That said, I find the expansion-layoff cycle icky.
- jodacola 3y ago
  > headcount is another number to advertise in the game of stock evaluation This is something I've had difficulty squaring over the course of my career. If a company remains small but makes boatloads of money because it builds a superior product, shouldn't that be rewarded more than having a higher headcount? From the perspective of having run engineering orgs (and a few failed - but enlightening - forays into founding a company), I've learned to believe from my experience that having the smallest team reasonable to achieve great things brings the most positive effects: folks are closer to the outcome, feel a stronger sense of ownership, want the best for the business, and reap the rewards of accomplishment, which in turn motivates the team to achieve and innovate more, resulting in growing revenue for the company. If I were an investor, I'd want smaller teams producing outsized results. Why would I want a gigantic team producing mediocre results?

ptero 3y ago

A few of those thoughts I completely agree on: results of overhiring, and technology enabling bigger impact by fewer people seem spot on to me. But a few I find strange. For example, a semi-implicit assumption that hiring, profits and stock price are tightly coupled. That is not always the case. They are correlated, but often have significant time lags, so it is possible for a company to hire rapidly on a great novel idea, realize a first mover advantage, have it lead to profits, have that lead to a stock rise by which time there is no longer a need for aggressive hiring. The company does not even need to do layoffs, just a stop to aggressive hiring is enough to feel a frozen job market. Edited: apparently I totally misunderstood the meaning of the "non-regrettable attrition". Is the only difference with a layoff is firing employees one-at-a-time vs en masse?

csa 3y ago
> Is the only difference with a layoff is firing employees one-at-a-time vs en masse? Theoretically, layoffs are not performance-related, although sometimes they are. Getting laid off doesn’t necessarily reflect poorly on the person who was laid off. Firing is performance-related, and it’s usually a bad look. The former may get severance and will probably be eligible for unemployment, while the latter will likely get neither.
- ptero 3y ago
  Are you sure about the unemployment? Given that it is usually administered by the state (at least in the US) I am surprised that any non-criminal involuntarily termination would be rejected for the unemployment benefits. But IANAL and personally never needed one, so anything is possible.
  - csa 3y ago
    > Are you sure about the unemployment? Definitely not sure, and it probably varies based on location. In CA, where I am, one criterion is “unemployed through no fault of [their] own”. Getting fired is widely considered to be the individual’s fault (e.g., non-performance). I’ve heard something about the standard being “egregious misconduct”, but that’s just beyond the details that I know about. Getting laid off usually isn’t considered the employee’s fault (e.g., due to lack of work or change in direction). Iirc, companies might have increased payments into the state unemployment coffers when they do layoffs versus firings. I have only heard about this second-hand, so I don’t know the details. Anecdotally and perhaps only tangentially related, I have friends and family who have had to or chosen to fire people, and they have all said the same thing — layoffs are much easier than firings.

nonrandomstring 3y ago

> Sam Altman when he says there may someday be a billion-dollar company run by one person who is able to highly leverage future AI agents to automate most traditional roles at a company. Altman is nearly right, but Warren Bennis had it better; The factory of the future will have only two employees, a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment. It's not that companies will "leverage AI" but that AI will leverage humans. Companies are already "AIs", but that will become more and more apparent as time goes by.

hef19898 3y ago
Yeah, neither of those things is going to happen in our lifetimes. Regardless of what Altman says.
- nonrandomstring 3y ago
  Play the game "Flateye" [0,1]and come back to us on that :) [0] https://flateye-game.com/ https://flateye-game.com/ [1] https://www.youtube.com/watch?v=5HdYFdcfdXk https://www.youtube.com/watch?v=5HdYFdcfdXk
  - hef19898 3y ago
    Try flat eye at managing a factory, and come back to tell me how it went. A game as a reference, seriously? No idea which film I recently heard the term, but amateur hour doesn't even come close to decribe that...
    - nonrandomstring 3y ago
      Did you just actually take me giving you a joke game as a "reference" seriously? I'm not sure what worries me the most now.
      - hef19898 3y ago
        Unfortunately, I cannot tell anymore sometimes... As a joke, it is right down my alley! So please, take my apology.

darkerside 3y ago

When there is a one person $1B company someday, which I think is very possible, I believe it will come after a series of events that will make it obvious that such a thing could exist. For example, the existence of several multi trillion dollar market cap companies, plethoras of small companies worth several billion dollars, and probably a radical rethinking of compensation and capitalism in the economy.

hef19898 3y ago
One billion as in VC-pre dumb money round valuations? VCs, and Altman, would love that!
williamDafoe 3y ago
Probably the guy who masters how to make realtime interactive porn with AI will be the first $1 billion sole proprieter ... Don't laugh YouTube already has hundreds of StableDiffusion channels uploading MANY videos a day ..
- CoastalCoder 3y ago
  He'd also probably win some Nobel prize for addressing human overpopulation. I feel bad for any normal human who needs to compete for affection against a future, hyper-optimized AI sexbot.
no_wizard 3y ago
I think WhatsApp stands out here, as they had 55 people employed when they were acquired for 19 Billion in 2014. I know it was mostly stock but given how things played out, that means it was worth even more as it were (Meta stock only rose from that time period onward, for the most part) We're already starting to see this become more and more possible with fewer and fewer people.

romanzubenko 3y ago

Did anyone perform an analysis on where the laid off employees for last 3 years went? According to layoffs.fyi nearly 500k were laid off since 2021, would be interesting to see if people mostly reshuffled within FAANG or there was a more structural talent migration e.g. from megacorps to startups.

UncleOxidant 3y ago
And how many haven't landed anywhere yet.
- ok_dad 3y ago
  And after ~12 months or so, they are removed from the "unemployment" numbers as "no longer looking for work" so that the numbers look better. ref: https://www.bls.gov/cps/cps_htgm.htm#nilf https://www.bls.gov/cps/cps_htgm.htm#nilf
  - kibwen 3y ago
    No, you still count as unemployed even if you haven't had a job for 12 months, as your own link attests. The question is whether you've looked for a job at any point in the past year, not whether you've held one. More broadly, the US government publishes six different measures of unemployment, all of which can be seen here: https://www.bls.gov/news.release/empsit.t15.htm https://www.bls.gov/news.release/empsit.t15.htm . The media usually focuses on U-3 (currently 3.7%), whereas the broadest metric is U-6 (currently 7.2%).
    - ok_dad 3y ago
      Your comment us needlessly pedantic, as I linked the full answer and said “~12 months” which is “about twelve months” which is not incorrect, though I’m sure the average is probably closer to 18-20 months for being removed from the U3 stat.
- ghaff 3y ago
  Or didn't seriously try to. I know people who almost certainly did pretty well over the past 15 years or so, got caught up in some layoff, and retired or semi-retired--probably a few years earlier than they would have done in different circumstances.

UncleOxidant 3y ago

> Some of this productivity gains just come from adoption of existing tools like Google Workspace or Office 365, issue trackers and version control with tools like Gitlab, Github, or Jira I guess I haven't seen Jira be something that actually improves productivity. More often it seems to be a productivity suck.

acdha 3y ago
I’ve usually found that to be a symptom rather than the root cause: if Jira is turning into a job rather than a tool to do your job, switching tools without switching managers won’t change much.
marcosdumay 3y ago
Office applications (spreadsheets excluded) also look like a tremendous productivity sink to me. Anyway, the answer the article is looking for seems very clear to me. The informatics companies got into a hiring scare recently, and are trying to undo it with a firing scare. Those companies appear to be run by bozos, and trying to look into theoretical fundamentals for their behavior is a fools errand.
- kelnos 3y ago
  Consider the old-school alternatives, though. Before we had computers, we had electronic word processors. They were a step up from typewriters, but computers made creating and editing documents so much easier and streamlined. No need to retype from scratch if there are errors that require too much correction fluid/tape, or if you need to add or remove or rearrange paragraphs. And then pushing that further, putting the documents online in a way that allows for easier collaboration, means no more sending .doc files through email and keeping track of who has made what changes, and merging everything into a final document, manually. As much as we all despise the stereotypical PowerPoint presentation, these sorts of apps let you create presentation material without expending too much effort. Otherwise you're creating poster boards by hand, or typing something up and photocopying it, or creating some kind of overhead projection thing. Collaboration is again so much easier.

divbzero 3y ago

> At tech companies some roles are highly leveraged… These leveraged roles can create enormous amounts of value, but the unlock in technology can come from a single person, a single insight. This core idea about tech employees having high leverage is spot on. It not only results in the high compensation that tech enjoys at the moment, but also explains why attrition and layoffs are a part of the process. Companies with a lot to gain from technology are willing to throw money into hiring, but are simultaneously figuring out which roles are actually paying off and which ones aren’t.

dogman144 3y ago

I’m a security engineer, so my work is a bit different than SWE - data wrangling and analysis, tying systems together and correlating events across them, building defense in depth, cool and effective under stress. That said, LLMs are showing up a lot in my job. Being a good sec eng is having a 70% base in most systems, solid comp sci and programming chops (I call it I can build and run a mediocre app), and solid security expertise. GPT is really good at radically speeding up how to get past the 70% starting point I usually operate from. I run (sanitized) terminal output through it so the 60% of the output I table to RTFM later to understand, I can understand immediately via GPT. Sec eng benefits a lot from leaning into pandas/notebooks vs log csvs, and GPT does that really well too. The big marker for me is incident response - standardized tech data requiring analysis and correlating in a pinch. I’m going to have an incident response LLM partner soon enough. Analyzing open source codebases for how they do input sanitizing with a new to me language? LLM partner walking me through. All this together - goodbye entry level cybersecurity jobs in a few years I think. Many of the things you’d need a security analyst for or the more busy work sec eng 1 jobs I truly think are turning into LLM jobs. My lived experience this past year reflects it. I think layoffs, and productivity gains from LLMs are under the hood of tech layoff tight now. Curious if other engineering tracks are seeing this though? A SWE buddy at Google thinks so.

MattGaiser 3y ago
Entry level devs will need to be much more skilled than I was to enter the field a few years ago. My internships and the first 6 months of my first full time job are trivial to ChatGPT. Copilot would be needed for work since then (as it is specific to the codebase), but even so, I am far more productive with them. One of my first internships was hacking together a mobile demo of a digital ID concept. I’d be surprised if it took more than a few hours to replicate a month of vanilla HTML/CSS/JS effort from back then. I would prefer ChatGPT to me as a co-worker up until about 1.5 years of experience, if simply because it replies instantly and doesn't forget stuff.
- shrimp_emoji 3y ago
  New devs' code looks like ChatGPT wrote it if it had been trained on pre-existing parts of the codebase. Copy pasta eeeverywhere :p

elliotto 3y ago

Does this article actually say anything? It seems like a tech bro founder who laid off 7% of his staff rambling and everyone eats it up for some reason? Don't forget the a16z quote because we aren't done shilling crypto

kj4211cash 3y ago

There are a lot of posts claiming that advances in technology over the past decade or two have been leading to "productivity gains". But the economic data simply doesn't support these claims. Productivity growth has stalled in most of the developed world. I like the way tech companies operate. I like slack. We don't use P2 but it looks interesting. I just don't really believe it'll turbo charge productivity at my company, much less at a more traditional company. I'm going to avoid saying anything one way or the other about AI because that would be a separate argument.

deadbabe 3y ago

Paying less for an engineer in a low cost of living area may save you money in the short term but will wound you in the long term if you value employee retention. If you have a truly skilled engineer paid cheaply, it’s trivial for a large company from a high cost of living area to offer them a 20% salary bump and snatch them away. Good luck if that employee had valuable insight into company processes.

yedava 3y ago

I don't think productivity gains explain why companies need fewer people to be employed. A better explanation is that tech companies have grown too big. They've established big enough moats to prevent competition from arising, and if for some reason competition did arise, they can just be bought out. So we have something like a monopoly/oligopoly situation where companies are in a rent seeking phase and don't need as many employees as before when they were in a value producing phase.

alephnan 3y ago
> I don't think productivity gains explain why companies need fewer people to be employed Right. If these productivity gains actually scaled, then why not add more people?

deleted 3y ago

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webosdude 3y ago

May be time for Unionization in Tech to stabilize things and protect tech workers? There is already unionization in some parts of Europe.

williamDafoe 3y ago
Unions only work in locations where capital is immobile and the labor to operate the capital is immobile. Tech labor is the most mobile on earth ...
- meowtimemania 3y ago
  I'm dumb, why do unions only work where capital/labor is immobile?
  - thedevilslawyer 3y ago
    Because the capital is immobile (can't move) from the labor. When it is mobile, it moves away from the union, to a place without union.

williamDafoe 3y ago

In my experience, the USA is shitting on its entry-level engineers. I know 3 junior engineers unemployed 6 months after graduation, from top 20 to top 40 schools. They have 10 total internships among them. One had a zoom, corp job with 24/7 hours they had no life and quit. One had their offer rescinded 4 weeks before start date. One had their position cancelled 60d after start date. All are now longterm unemployed with virtually no interviews. Meanwhile overseas hiring and 85k H1B workers are flooding the job markets annually, its galling ...

hn_throwaway_99 3y ago
As the top comment says, this is sadly a consequence of remote working. I started my career in the dot com boom a quarter century ago, and when it burst there was initially a huge rush of fear that "everything will be outsourced to India and China". That never really panned out, primarily because (a) teleconferencing tech wasn't nearly as good as it is now, and (b) the huge timezone differences were an absolute killer for productivity, especially in a world that discovered things like fast cycle times and continuous deployment were a critical competitive advantage. Now, though, I think a lot of companies have learned from those problems. I see much more outsourcing to places like Latin America (same or nearly same timezone) or Eastern Europe (obv. not as good timezone overlap but still doable if you have US workers start a bit earlier than usual and European a bit later). Also, since nearly everyone, even in "RTO" offices, spends a huge amount of time on Zoom, etc., it's much easier to have outsourced workers treated as fully equal team members. I agree, it totally sucks for US entry-level devs. Based on my experience in the US of how we outsourced other previously critical competencies, I don't have a good answer.
charred_patina 3y ago
Class interests supersede national interests.

bilsbie 3y ago

I’ve noticed salaries haven’t kept up with inflation from the last four years. Could that be playing a role? Maybe companies realizing they can’t attract employees with their budgets so they don’t bother hiring?

Anastesia67 3y ago

[flagged]

atduskgreg 3y ago

Another obvious cause I don’t see anyone mentioning: tech simply created a lot less value in the last decade than in any previous decade. Pretty much every one of the big hyped up technologies that was going to be the future of everything turned out to be a bust: IoT, drones, cryptocurrencies, NFTs, and on and on. Even the ones that got some traction like ride sharing really were just castles of smoke floated on giant clouds of dumb middle eastern and Asian venture capital money looking for a greater fool. Most of the changes in web development tech have made software slower and more bureaucratic to make in order to support large FAANG-style software orgs. There was absolutely nothing remotely on the scale of the smartphone, social media, the web, the personal computer, etc from previous decades in terms of actually creating real value for users. Today’s tech industry deserves to shrink.

IamLoading 3y ago

That said, after working with small teams. I observed Its kind of hard to maintain all team member enthusiasm and drive without feeling like getting burnt out.

AntiRemote 3y ago

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cyka_privet 3y ago

FYI, Automattic has lost more headcount in 2023 (proportionally and in absolute terms) than some companies that had public layoffs. I know of several cases where individuals receiving stellar reviews were suddenly fired for “performance reasons”. Call it what you want, Automattic has been doing stealth layoffs and it is disingenuous to pretend it has not been.

deleted 3y ago

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alephnan 3y ago

> Some of this (tech industry) productivity gains just come from adoption of existing tools like Google Workspace or Office 365, issue trackers and version control with tools like Gitlab, Github, or Jira. Why would other industries need version control with tools like Gitlab, Github, or Jira. These tools exist to solve complexity problems that arise in software. They aren't making the tech industry more productive then others. If anything, it's a huge red flag if a company is a little too obsessed with Jira.