The tech industry entered 2024 with another wave of job cuts, shrinking further after last year’s widespread layoffs.
So far, about 32,000 tech workers have lost their jobs in 2024, according to Layoffs.fyi, a startup that has been tracking job cuts in the industry since the pandemic.
Snap Inc. became the latest example, announcing on Feb. 5 that it will reduce its workforce by about 10 percent, or about 540 employees. Earlier this month, software company Okta Inc. said it would cut seven percent of its staff to cut costs, affecting about 400 employees. The list goes on, including Big Tech employers like Amazon.com Inc., Salesforce Inc. and Meta Platforms Inc.
This year, “tech companies are still trying to correct their overhiring during the pandemic surge, as the high interest rate environment and tech slowdown have lasted longer than initially expected,” the Layoffs founder wrote. fyi, Roger Lee, in an email.
According to Lee, there have been two main waves of job cuts in recent years. The peak of “early Covid,” from the first to second quarter of 2020, and the “rising interest rates” effect, which has been occurring since the second quarter of 2022. “This year’s layoffs are typically more smaller and more specific than the layoffs a year ago,” Lee said.
Although economic factors are the main reason for layoffs in the tech sector, Lee noted that many companies are citing the race for artificial intelligence as a factor as they shift resources to focus on AI talent. According to an analysis by CompTIA, which tracks employment trends in the technology industry, job openings in “artificial intelligence or requiring AI skills increased by about 2,000 from December to January, to 17,479.”
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So even as the industry eliminates some jobs, it is also hiring aggressively in others. According to CompTIA, there were 33,727 active job openings in January, the largest month-over-month increase in 12 months.
“I feel like most of the layoffs have already happened and that companies are going to start to recover,” said Bert Bean, CEO of staffing firm Insight Global. “But it’s still very uncertain.” He expects the market to stay that way for the next two quarters or so, “until the Federal Reserve actually comes out and starts cutting interest rates.”
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