Big Tech is laying off employees by the thousands. Why? And how worried should we be?
The tech sector has seen explosive growth in the last two years. The pandemic saw a dramatic rise in hybrid working models as employees ditched the office to work from home. It hired thousands of workers as major firms such as Amazon and Facebook doubled their workforce in just a few months. Now with a potential recession looming, tech companies are laying off employees left and right. In the last one year, more than 70,000 people have been laid off by Big Tech companies worldwide. What has caused this massive shake-up?
Hannah Prewett spoke to Kim Antonio, Founder and CEO of Auris Tech, Ketan Makwana, TEDx, speaker, author and consultant, Melissa Snover, Founder and CEO of Nutrition, and Will Hale, Group Director EMEA, at the tech show on Monday. London, Excel on Wednesday, 8 March. She asked the panel about the massive layoff of tech talent and what it means for the workforce.
Ketan explained how tech companies have gone on a massive hiring spree during the pandemic, and because the current market and economy have changed, it is very expensive for these firms to retain their talent. “A lot of these tech companies went on optimal hiring practices during the pandemic and lockdown as they built out these teams for hybrid remote roles,” Makwana said. “Now things are starting to change in that these big tech companies need to perform, and it is now creating this void where it is very expensive for them to keep these employees. So, what you’ve got now is an abundance of talent in the market, but I don’t think talent has gone up a notch or level as it is currently.
Hale said the massive layoff of top-level tech talent has changed the outlook of workers in the industry. This is part of the reason for the ‘knock-on’ effect felt by employees, as many are afraid to jump into new roles and put their current jobs at risk. “We’ve seen an uptick on Monday.com in terms of people applying and reaching out directly,” Hale said. “But it has been kind of hard to attract talent, so the biggest impact of redundancies is that top tech talent is probably more reticent to negotiate with you because of the uncertainty in the market. Maybe ‘I’m better off where I am’ ‘ It’s even more difficult to get people interested because of the fact that
Employees who were offered higher pay packages from Big Tech firms can expect similar pay if they move to other firms. This has created a culture of big pay in tech industries, but start-ups may not necessarily have the budget or resources to offer workers big pay packages — like Facebook and Amazon can. “The big tech companies really have a lot to answer for because they cornered the market in that specific layer of talent,” Snover explained.
“These people have gone on to make a living through really high inflated salaries. We are a startup and we can’t pay the same salaries as Facebook or Twitter or any of those other big companies, even if you Be great and you’ll have a thriving career here, we have to meet somewhere in the middle. It’s going to take a little longer for those people to either adapt or find a way to move on and get back into a different type of work.
Some businesses employ their technical teams remotely and outsource talent overseas. Antoniou hires workers from all over the UK – and even as far away as the Philippines. “Most of our tech team is over in Manila, Philippines and it works really well for us, and they mainly work from home. One of the things that Covid has done for us is that technical teams often work remotely, and they’re often really motivated to work for businesses because they can have that autonomy and work from home. can work. Connecting technical teams is made easy. We also have people in the Philippines as well as in Edinburgh and Birmingham. It’s relatively small texting but all over the place and it works.
However, some businesses prefer to keep their employees in the office on certain days during the week in a hybrid working model. Some companies believe in investing in state-of-the-art spaces to create a collaborative culture where employees can come together and work as a team, enjoy their time at the company and create a productive workforce. Can “During Covid, we didn’t have the facility, so everyone was working remotely,” Hale said. “Our policy was that you can work for three months at a time in a location that suits you. When we opened the office after the pandemic, we had a lot of people who wanted to come to the office. As a company, we invest a lot in our offices.
“For our offices in Tel Aviv, we have a football pitch and a spa, we put a lot of money into it because we believe a lot in being around people in the workplace. Now we collectively get together three days a week Working in an office. We first had a dilemma in deciding whether we should get a small office or a large office based on our plans to see people working in an office or not. We are safe We went for a smaller office in London as a bet but we were oversubscribed. Within six months, we had to move to a new office which is now 12,000 sq ft spread over two floors because people wanted to move in.
However, not all businesses believe in doling out perks. Makwana outsources its staff instead of hiring employees full time, bootstrapping and spreading resources more efficiently — and giving up free lunches and gym memberships. Makwana explained, “We don’t have the pool of cash to go through with recruiting, we don’t have the facilities to be able to give them football or free beer at 6 o’clock.” “As an entrepreneur and business owner, I need results fast. I am always into agile teams and outsourcing work. The great thing about outsourcing is that I can change my teams whenever I want, I can contract them and get them contracted, and I don’t need to worry about recruiting because I’m not a recruiter.
“I can let them handle that part of it and I can fine tune a lot of the tax with paying where it goes. I don’t think there’s anything wrong with using recruiting to build tech, But it depends on what business you are in and what stage and size your business is…it’s more project management than leadership management. You set expectations and make sure they are met who are contractually bound to deliver these particular results. If they don’t deliver the results, they don’t get paid. If you hire someone, it takes them six months to get into the role, you They’re going to provide breakfast lunch and dinner, a football pitch and a spa, and it takes 30% of the cost of their wages to get them out of the system. You’re probably paying them double.”
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