Meta, Twitter, Amazon … serial job cut plans in Tech in the United States

By Philippe Guerrier | The

| Employer brand

Human resources are derided in the Tech sector in the United States. Job cuts follow each other at leading digital companies. A look at Silicon Valley and beyond.

Meta, Amazon, Twitter: layoffs in 2022 in the Tech sector in the United States – © DR

  • 11,000 job cuts at Meta / Facebook (13% of the workforce),
  • 10,000 job cuts are planned at Amazon from mid-November according to the New York Times (ie 3% of the corporate workforce or 1% of the global workforce),
  • 3700 dismissals at Twitter (50% of the workforce).

Layoff plans are on the rise among digital groups or companies in Silicon Valley and the rest of the United States.

The reasons are different depending on the situation of the companies: cost rationalization for Amazon, lower financial results for Facebook, acquisition of Twitter by the new owner Elon Musk who bought the social network at the end of October 2022 for 44 billion dollars. .

Microsoft is also concerned, but the extent of the job cuts and the perimeters concerned remain unclear.

Meta: the biggest job reduction plan has been activated

Mark Zuckerberg, CEO and co-founder of Facebook who became Meta in October 2021, announced on November 9 the largest job cut plan since the company was founded in 2004.

“We will take other complementary measures to become a more agile and efficient company by reducing secondary costs and extending the recruitment freeze until the end of the first quarter of 2023”said Mark Zuckerberg in an internal communication message.

All the group’s digital services are concerned: social networks Facebook and Instagram, and WhatsApp instant messaging.

This plan after a series of indicators deemed “alarming” by financial analysts:

  • the publication of Q3 2022 financial results ($27.7 billion as of 10/27/2022, with revenue down 4% compared to the same period last year,
  • a stagnating number of active Facebook users worldwide (1.9 billion),
  • a metaverse-oriented approach to development that confuses financial markets.

Amazon: cost savings

According to an article in the New York Times on 11/14/2020, the Amazon group plans to lay off 10,000 employees.

The hardware division with the Kindle range of consumer digital terminals associated with the Alexa voice command service, activities related to distribution (retail) and HR services, will be a priority.

This planned job reduction comes during the pivotal holiday season, when Amazon traditionally ramps up its workforce to handle the volume of orders to process and parcels to ship.

Twitter: impact of the acquisition of Elon Musk

With the successful takeover of Twitter by Elon Musk (also the head of Space X in the space industry and Tesla in the automotive sector), the situation is different.

The billionaire entrepreneur is looking for levers to rebalance the accounts of the social network as soon as possible.

In addition to looking for monetization levers of the Twitter platform, he decided to part with 50% of the company’s workforce (ie, 3250 expected job cuts). Drastic moves also worried top managers like CEO Parag Agrawal and director of legal affairs Vijaya Gadde over strategic differences.

In terms of work organization, Elon Musk is also on the front lines. He urged teams to ditch telecommuting practices and return to the office full-time. In his first email sent on 10/11/2022 to Twitter employees after his hiring, he said that “The road to the future is difficult and requires hard work to succeed”according to the Financial Times article from 11/11/2022.

To put the teams under more pressure, Elon Musk launched in an internal message a quasi-ultimatum: collaborators must quickly agree to work hard to design “Twitter 2.0” according to CNBC.

Tech sector in the USA: job reduction plans spread through 2022

Overall, more than a hundred technology companies have cut jobs in varying proportions since the start of 2022, according to a count conducted on November 14 by TechCrunch. These plans involve 67,000 workers in this sector, according to this progress report.

At the same time, EconomyApp, a digital economy tracking service, reports another number of American technology companies that have initiated job cuts since the beginning of 2022.

This sums up the situation in a tweet broadcast on November 10, 2022.

Tech layoffs in the United States: a data visualization to follow the wave to 2022 - © DR

Tech layoffs in the United States: a data visualization to follow the wave to 2022 – © DR

“If the hyper-growth model of these Silicon Valley giants seems to be at a tipping point, the tech market in the United States is far from shrinking”said Diego Ferri, Chief Strategy Officer, EY Fabernovel.

“If we look at the data published in November 2022 by the US Bureau of Labor Statistics, which takes into account the entire tech market in the United States at the end of September, we notice that the unemployment rate in the sector has reached a very high level. . decreased by 2.1%, although the number of published offers decreased slightly. »

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