TL;DR: The year 2022 is no less than a roller coaster ride. People are left with less real income because of rising living costs and the falling recruitment market. However, the tech sector tops the list of companies adapting to the trend of firing employees and slowing down new recruitments.
Flashback at the list of companies behind setting the trend
Numerous companies have fired their employees. Some with notice and others without prior notice. However, the news of the most enormous layout in the country was captured when Unacademy fired over 1000 employees in April.
After that, the news of Twitter firing its top two executives flashed the news headlines. Additionally, CEO Parag Agrawal, stated that Twitter would freeze hiring for a couple of months.
Right after people were familiarizing themselves with the firing trend, the news of Netflix’s layoffs captured the limelight. The movie streaming platform fired around 150 employees. Later, Snapchat joined the list of companies slowing down hiring.
Bolt Financial and Nvidia are in the limelight now
The firing and slowdown news is now carried forward by the fintech startup Bolt Financial and the chipmaker Nvidia. Recently, Bloomberg reported, quoting the company’s memo, that Bolt Financial is facing troubled times. Thus, resorting to cutting staff. Nvidia has also announced that it will slow down its hiring in the upcoming months.
Hiring slowdowns and firing are becoming a norm across tech companies. Why so?
The times are challenging for people across fintech, edtech and other similar sectors. Companies are stating varied reasons for their sudden moves. For instance, Unacademy called it a “periodic retrenchment exercise” to improve quality and efficiency.
In the case of Twitter, Parag Agrawal stated that the firing was done to improve efficiency and prioritize performance management. And when the Netflix firing news surfaced, readers weren’t surprised as the company had earlier shared the announcement of its declining growth revenue. Snapchat, while slowing down new recruitments, stated that the social media platform is doing so to battle dwindling revenue.
The new joiner in the list, Bolt Financial, a $11 billion company, has stated that it plans to lay off to secure its financial position. The recent fundraising wasn’t a success. Additionally, the company’s software provides retailers with a one-click online checkout option.
Thus, the firing could also be because of the rising complaints against the company’s software. The clients have complained that Bolt Financial’s tech doesn’t deliver what it promised.
Lastly, after the Q1 early report for Nvidia was released, the company announced for recruitment slowdown. It has lowered its expectation for the next quarter.
Why else are big tech companies facing layoffs?
Conclusively, the current trend could be because of the supply chain woes because of COVID. Additionally, the Russian invasion of Ukraine is also a significant cause; the prices for most essentials are now skyrocketing. Thus, the employment market may get back on track once the war is stabilized and the supply chain woes are soothed.
Talking about social media companies, Apple’s App Tracking Transparency feature seems to have hit Facebook and Snapchat the hardest. Both companies have lost revenue because of Apple’s policies, and project further losses in the future.
In the case of Twitter, Elon Musk’s takeover has tied the platform’s hands, which is now slowing down hiring and changing top management.