4 ms·
Why are layoffs always seen in a bad light. Sometimes what you need is to trim the fat.
by davidguetta 2y ago
Why are layoffs always seen in a bad light.
Sometimes what you need is to trim the fat.
- alexander2002 2y agothats a nice analogy!
- TheAlchemist 2y agoBecause they are not seen in a bad light ? Layoffs are usually pushing stock prices higher - especially for software companies. It's a different story though when a labor intensive manufacturer with a 50% projected growth is laying off people...
- rsynnott 2y agoGenerally, a company doing layoffs is either experiencing a demand shortfall if the layoffs are associated with current business (manufacturing, sales, etc etc), or is sacrificing future revenue to cut costs now if the layoffs are associated with R&D, sales development, etc etc. Neither are great signs.
- spicyusername 2y agoMaybe don't hire fat, though...
- jowea 2y agoBecause there are more people who care about the jobs than care about the stock price.
- paxys 2y ago"Trim the fat" is already happening every year during performance reviews. Companies like Tesla in fact brag about their cutthroat high-performance culture and cutting the bottom X% if they aren't up to par (e.g. see all their job listings, or posts like https://www.tesla.com/blog/in-response-false-allegations https://www.tesla.com/blog/in-response-false-allegations). If the company is doing mass layoffs on top of that then it pretty much always means financial trouble. And these layoffs tend to affect the talent that you want to keep.
- andsoitis 2y ago> If the company is doing mass layoffs on top of that then it pretty much always means financial trouble. When the big tech companies have been doing mass layoffs, the vibe amongst the workers and on here has always mostly been: but they're making so much profit! The reality is that an astute and strategic CEO/board will do layoffs as a last resort in order to steer a company through troubling times ahead. Tesla forecast a large drop in 2024 EV sales, which is now happening. They didn't do the layoffs until their forecast turned out true.
- jsnell 2y agoWhen did Tesla forecast that? Back in January they were just predicting lower growth in sales, not a drop.
- suzzer99 2y agoHaving worked for multiple large companies, a 10% fat trim is almost always going to be beneficial. Underperforming employees drag everyone else around them down far more than just their own lack of productivity. Now if Tesla is really alreadly slicing that close to the bone (like Microsoft when it used to cut 10% every year), then it could be detrimental. But if I had to bet w/o any inside knowledge, I'd guess the 10% cut is still not going to hurt that much, and could be a boost.
- barryrandall 2y agoIt signals to the market that leadership is prone to overhiring and other forms of waste.
- marcosdumay 2y ago> Sometimes what you need is to trim the fat. Yes, every time you starve you need to do it.
- rurp 2y agoAnd mass layoffs are a reliable way to do that? This layoff, like most, seems more driven by top line sales and stock performance than individual worker performance. I doubt 10% of Tesla's workforce just happened to turn into "fat" shortly after a brutal earnings report.