Tech names are leading the pack of companies who have had massive layoffs in the last 12 months, with more firms bound to cut more jobs as the year continues.
Amazon.com (Nasdaq: AMZN), which tops the list with its 18,000-job cut announced in December, is ready to begin a round of layoffs. The most recent wave, which is set to begin on Wednesday, will mostly effect the retail division and human resources.
The layoffs began last year and were first concentrated in Amazon’s Devices and Services group, which produces the Alexa digital assistant and Echo smart speakers.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” CEO Andy Jassy said earlier this month in a memo to employees. “These changes will help us pursue our long-term opportunities with a stronger cost structure.”
The layoffs come as the retailer struggles with declining online sales growth and prepares for a probable recession that will reduce its consumers’ spending power.
Microsoft (Nasdaq: MSFT) and Meta (Nasdaq: META) trail in a close second after the e-commerce giant. According to a person familiar with the situation, Microsoft expects to slash jobs in a number of technical divisions on Wednesday, rumored to be significantly wider than the past layoffs the firm has conducted.
Microsoft had reduced its personnel in October and July, eliminating unfilled positions and pausing hiring in various departments.
Earlier in November, Meta announced that it would be cutting 13% of its workforce, equating to around 11,000 employees. The tech firm, going heavy on its metaverse track, has also said it would freeze hiring opportunities until Q1 2023.
Prior to these cuts, Twitter has also slashed around half of its workforce or about 3,700 employees, in which the tech firm is currently facing a lawsuit in an alleged violation of federal and California law as the layoffs were reportedly being carried out without enough notice.
In Canada, Lightspeed Commerce, a Montreal payments and retail platform, said it will lay off about 300 people, or roughly 10% of its workforce, as it integrates the companies it has purchased in recent years. The cuts represent a tenth of the company’s headcount-related operational expenditures, with managers being let go accounting for half of the total cost savings, according to a news release issued Tuesday.
The company followed other large Canadian tech firms in publicly announcing job cuts during the downturn. By last August, Shopify Inc (TSX: SHOP), Wealthsimple Technologies, and Hootsuite had all made significant layoffs.
Also on Tuesday, Toronto-based online vehicle vendor Clutch Canada Inc. announced a 150-person, or 65 percent, staff reduction and withdrawal from western Canadian markets in order to focus on the five eastern provinces, which account for three-quarters of its income.
Clutch’s recent cut is the second round in less than a year after laying off 6 people, or 22% of the company, last June. Likewise, Clearco, which cut 26 per cent of its work force a day earlier, and Thinkific Labs, which also had significant job cuts last week, are already making a second round of job cuts.
Technology companies are cutting back as the industry braces for a prolonged drop in demand. The Nasdaq index has lost almost a quarter of its value from a year ago, with the leading so-called FANG+ stocks losing more than 31%.
Information for this briefing was found via Bloomberg, The Globe And Mail, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.