American TV personality and host of Mad Money on CNBC Jim Cramer has disclosed that the tech industry will likely see more layoffs this year due to continuing macroeconomic headwinds.
Cramer stated that several macroeconomic factors such as rising inflation, and high fuel cost, amongst others, have continued to affect the revenue of major tech companies that are currently finding it difficult to pay their employees.
In his words, “There are so many tech companies with bloated payrolls that are still trying to grow rapidly, overpaying for new employees, and they fear that layoffs will mean that their time in the sun is over. They don’t seem to understand that their time in the sun ended over a year ago.”
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He further warned investors to refrain from being overly optimistic about how tech companies and their stocks will fare once more employees are laid off.
Cramer’s warning comes after American cloud-based Software company Salesforce, revealed plans to slash its workforce by 10% after it disclosed that it overhired during the pandemic.
The company’s proposed job cuts will impact more than 7,000 of its workers.
The tech industry has been faced with layoffs of workers as they have been hit with a global economic crisis which experts reveal was fueled by the Russian-Ukraine war and the impact of the Covid-19 pandemic.
Hiring freezes and layoffs have impacted every sector of the tech industry from web3 startups to even established tech giants.
The sector recorded a total of 1138 layoffs globally as of November 2022. According to a Crunchbase News tally, more than 91,000 workers in the U.S. tech sector have been laid off in mass job cuts so far.
Firms such as Meta, Amazon, Netflix, Tesla, Twitter, Zendesk, Snap, Spotify, etc have all laid off a significant amount of their workforce as they battle with several economic challenges.
Lately, it is like with each passing day, there is a report of mass layoffs and hiring freezes from big tech companies that were formerly famous for having deep pockets and near-endless amenities for workers.
It is visible that the industry as a whole is tightening its belt, leaving hundreds of thousands of employees out of work as it battles with the recent economic downturn in a bid to stay afloat.
Meanwhile, as tech firms continue to lay off a significant amount of its workers, a Tekedia article disclosed that these job cuts have presented opportunities for African techies.
Amazon will let go of more employees than it initially expected, CEO Andy Jassy announced Wednesday in a blog post. While roughly 10,000 cuts were estimated in November, over 18,000 workers are likely to be impacted, most within Amazon Stores and the People Experience and Technology Solutions team. Amazon saw tremendous growth during the pandemic, forcing it to hire hundreds of thousands of people to meet demand. However, the demand has since fizzled and paired with a gloomy economic outlook, the company launched a “broad cost-cutting review” last year. (LinkedIn News)