As the world continues to grapple with the ongoing COVID-19 pandemic, many industries have been forced to adapt to a new way of doing business. One sector that has experienced significant changes is the technology industry, with remote work becoming the new norm. Companies like Zoom, which provide video conferencing services, have seen a surge in demand as businesses and individuals rely on their platforms to stay connected. However, as the initial wave of the pandemic subsides and the world enters a new phase, questions arise about the long-term effects of this shift. One particular concern is the impact of Zoom layoffs on tech employment.
According to a 2023 report by Randstad RiseSmart, it is projected that a significant 92% of employers are preparing for layoffs in 2024, as they navigate the economic implications of the COVID-19 pandemic and adjust for potential overstaffing during this period.
A mass layoff is the termination of a large number of employees from an organization at the same time. Mass layoffs are usually due to economic downturns. When at least 50 employees are laid off within 30-days or less resulting in the laid-off employees equaling more than one-third of the company’s workforce.
Working remotely has been an emerging trend in recent years. Between 2017 and 2018, there were about 34.7 million full-time workers who had the option to work from home. Of these people, nearly 24 percent reported working from home due to personal preference. In 2019, 73 percent of people working from home said that the flexibility of working remotely had positively impacted their personal wellbeing and improved their ability to balance work with leisure and community activities. Additionally, more than 70 percent of people working remotely saw improvement in their mental health. In some cases, workers reported experiencing more distractions when working at home. However, many found a remote work environment to be more conducive to productivity, and saw improvement in their job performance; a factor that has made remote work appealing to employers.
Did Zoom have a layoff?
Zoom has decided to reduce its workforce by less than 2%, joining a growing list of tech companies that have initiated job cuts this year. The layoffs at video-conferencing giant, which saw a surge in popularity during the Covid-19 pandemic, come amid a push for greater efficiency, demanded by investors. Nearly 150 employees will be impacted by the decision.
Zoom, which experienced unprecedented growth during the pandemic, has not been immune to the economic challenges brought on by the crisis. In recent months, there have been reports of layoffs at the company, raising eyebrows and sparking discussions about the future of tech employment.
What companies are having massive layoffs?
Zoom is not the only technology company that has had to make difficult decisions regarding layoffs. Many other tech giants have also been forced to downsize their workforce in the face of economic uncertainty. Companies such as Uber, Airbnb, and Lyft have all announced significant layoffs in recent months, as they grapple with the impact of the pandemic on their respective industries.
Who is laying off in 2024?
No. of Employees to be Laid off: 1000
Industry: Technology
Google has initiated significant layoffs across its various teams, including the Voice Assistant, hardware, engineering and ad sales teams, marking a continuation of the tech industry’s trend towards reducing workforce expenses. The layoffs have affected hundreds of employees within the Voice Assistant unit; hardware teams responsible for Pixel, Nest and Fitbit products; and a considerable portion of the augmented reality (AR) team.
This move is part of Google’s broader effort to streamline operations and align resources with its most significant product priorities.
Last week, Google laid off more than 1,000 workers across several divisions, including engineering, services and voice-activated product Google Assistant.
According to The Verge, the total number is in the thousands. This comes at a time when Google parent, Alphabet Inc., reported record profits in late January. The company reported $20.4 billion in net income in Q4.
Google spent $2.1 billion on severance and other expenses as it laid off more than 12,000 employees over the course of 2023. And the layoff charges keep coming: in just the one month of 2024 so far, the company has already spent $700 million on employee severance charges as part of layoffs targeting another 1,000-plus roles.
You-Tube
Yet another series of layoffs has hit Google, this time at its video-sharing platform, YouTube. The company will eliminate 100 employees, a spokesperson confirmed to TechCrunch.
“As we’ve said, we’re responsibly investing in our company’s biggest priorities and the significant opportunities ahead,” a Google spokesperson said in a provided statement. “To best position us for these opportunities, throughout the second half of 2023, a number of our teams made changes to become more efficient and work better, and to align their resources to their biggest product priorities. Some teams are continuing to make these kinds of organizational changes, which include some role eliminations globally.”
Initially reported by Tubefilter, Youtube’s chief business officer, Mary Ellen Coe, wrote in an internal memo sent to staff on Wednesday afternoon that the job cuts were part of restructuring changes to its creator management and operations teams. According to The New York Times, workers have 60 days to find new roles before their dismissals are officially in effect
Amazon
The layoffs will impact “few hundred roles,” Amazon’s spokesperson confirmed in an email to BI.
One person said roughly 115 positions may be eliminated. Another estimated up to 400 employees could lose their jobs. The company had planned to announce the layoffs before February 1, but had delayed it due to Amazon’s recent earnings report and other internal issues, they said.
The plan is part of a company-wide mandate to reduce One Medical’s fixed cost structure, these people said. Amazon’s leadership wants One Medical to significantly decrease its operating losses and asked the healthcare company to save an additional $100 million this year, one of the people said. One Medical had an operating loss of $420 million in 2022, the last year it publicly disclosed financial results before getting acquired by Amazon.
Nike
Nike is cutting 2% of its global workforce, or little over 1,600 jobs, as the athletic wear giant aims to trim costs and reinvest its savings into what it sees as big growth areas like sport, health and wellness. Nike, based in Beaverton, Oregon, employed roughly 84,000 workers as of May 31, 2023 according to its annual report.
Nike Inc. shares fell as much as 4% after the sportswear giant said it will slash its global workforce by about 2%, pushing to reduce costs to counter a weaker sales outlook and growing competition.
The job cuts follow an announcement in December that the company is looking for as much as $2 billion in cost savings, including reducing its workforce and simplifying its product lineup as growing consumer caution weighs on sales.
CEO John Donahoe emphasized that this move is essential for reigniting growth and assured that affected employees would receive comprehensive support, positioning Nike to better serve athletes and the future of sport.
Accorrding to an article on Business Standard by Kim Bhasin, the lay offs will occur in two phases, according to a Nike memo seen by Bloomberg News.
Tik Tok
TikTok is laying off employees in an effort to reduce costs, according to employees at the video-sharing platform, making it the latest technology company to conduct a round of staff reductions in recent weeks.
About 60 employees were laid off, mostly in the company’s sales and advertising division, according to a company spokesperson, who attributed the shakeup to a routine reorganization. The eliminated roles include workers in Los Angeles, New York, Austin and abroad.
The company has scheduled a townhall meeting set to take place in the wake of the layoff announcement.
Estee Lauder
No. of Employees to be Laid off: 3100
Industry: Consumer Products
Estee Lauder would be laying off between 3% and 5% of its staff, impacting about 3100 employees, in order to reduce its expenses. It is aiming at cutting its global workforce as part of a restructuring program that aims to increase profits and become more nimble in a challenging international environment, reports ABC News. The layoffs were announced Monday as the New York cosmetic giant reported falling profits and revenue in the second quarter, and trimmed its annual profit forecast. The downsizing, which will affect as many as 3,100 workers, will be made by July, Estee Lauder said. The reduction includes the elimination of some positions as well as retraining and redeployment of certain employees.
Ford
No. of Employees to be Laid off: 2,700
Industry: Automobile
Ford has agreed with union chiefs to cut about 2,700 jobs from a German plant as it switches electric vehicle production to Spain. The jobs will be lost at the Saarlouis plant once production of the Ford Focus stops there next year.
Reuters) -Ford Motor on pegged the cost of a new labor deal at $8.8 billion and joined rival General Motors in cutting its full-year profit forecast due to lost production from a lengthy strike at its U.S. plants.
The deal with the United Auto Workers (UAW) union, reached after weeks of tense negotiations, will add about $900 in labor costs per vehicle by 2028. Ford said it would work to offset that by cutting costs .
UPS
No. of Employees to be Laid off: 12,000
Industry: Logistics & Supply Chain
UPS will cut 12,000 jobs as part of a bid to save $1 billion in costs. Managers and contractor positions will make up most of the layoffs. The shipping giant, which forecast weak demand for parcel delivery in 2024, has said it plans to lay off a significant numer of employees to save $1 billion in costs. It’s also mulling a sale of its Coyote brokerage unit.
“2023 was a unique, and quite candidly, difficult and disappointing year,” said UPS CEO Carol Tomé during the company’s earnings call. “We experienced declines in volume, revenue and operating profits and all three of our business segments.”
She attributed the weak performance to increased labor costs, challenges in the broader U.S. economy, freight complications abroad and the disruption tied to labor negotiations last summer that diverted business to rivals.
Microsoft
No. of Employees to be Laid off: 1900
Industry: Technology
Microsoft will lay off around 1,900 employees in its gaming unit, or around 9% of its workforce. Microsoft Gaming CEO Phil Spencer said the layoffs were part of a larger “execution plan” to reduce overlap areas.
Microsoft is cutting about 1,900 jobs at Activision Blizzard and Xbox this week, per an internal memo from the head of the company’s gaming division. he cuts represent about 8% of the overall Microsoft Gaming division, which employs roughly 22,000 people, with most of the layoffs set to happen at video game publisher Activision Blizzard. The president of the subsidiary, Mike Ybarra, is also leaving the company.
The cuts work out to roughly 8% of the overall Microsoft Gaming division that stands at around 22,000 employees in total. The Verge has obtained an internal memo from Microsoft Gaming CEO Phil Spencer that confirms the layoffs “ As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible.”
Pixar (Disney+)
Pixar, a Disney-owned animation studio, is set to undergo significant layoffs this year as part of Disney’s broader cost-cutting measures, which aim to increase efficiency and reduce streaming losses.
The layoffs, affecting employees hired for Disney+ content production, come despite Disney+ gaining 7 million new subscribers in Q4 and the success of Pixar titles like “Elemental” on the platform.
These changes reflect Disney’s strategy to streamline operations and focus on profitability in streaming, amidst industry-wide shifts in audience preferences and content delivery methods.
The layoffs at Zoom, while unfortunate, are not entirely surprising given the circumstances. As the initial surge in demand wanes and companies look to streamline their operations, tough decisions regarding workforce reduction often become necessary. It is important to note that these layoffs are not indicative of a failing company, but rather a response to the shifting dynamics of the market.
In conclusion, the layoffs at Zoom are reflective of the changing landscape of the industry. As the world continues to shift towards a digital-first approach, companies must adapt to survive. While the immediate impact of these layoffs is undoubtedly challenging, it is important to remember that the tech industry remains resilient. The long-term effects of these shifts are yet to be fully understood, but one thing is certain: the way we work and the employment opportunities available in the tech sector will continue to evolve.
