Google, Amazon, Meta and others have cut more than 190,000 jobs: layoffs could spread to more sectors
Just last week Microsoft and Google announced thousands of cuts, when this Monday, Spotify shook the technology industry again with the announcement that it will lay off 600 of its employees.
Photo: PATRICK T. FALLON/Getty Images
The technology industry has shaken the job market in the United States after mass layoff announcements in most of the big giants in the sector, such as Google, Amazon, Meta and Microsoft, among others.
Until the end of last week, the technology sector had cut more than 190,000 jobsaccording to the website Layoffs.fyi, specialized in tracking the cuts in this sector of the economy.
The labor market was still commenting on the massive layoffs at Google, announced on January 20, when a new giant in the industry, Spotify, confirmed this morning that it will lay off 600 of its workers, equivalent to 6% of its workforce.
While it is true that for the moment, mass layoffs have been contained in the technology industry, with some cases such as Goldman Sachs, for some analysts, this is nothing more than a preview of what is to come.
The reading that labor market analysts give to the massive layoffs in recent days is that the technology industry prepares for a recession that seems inevitable during 2023.
The movements in the technology sector, with 12,000 fewer employees at Google, 10,000 at Microsoft, 18,000 at Amazon and 11,000 at Meta, contrast with reports from the Bureau of Labor Statistics showing that the US job market remains strong. .
Layoffs could spill over to other industries
Amazon, Google, Meta and Microsoft are not the only tech companies that have cut back in recent weeks.
Others like Twitter, in the midst of a controversial purchase by Elon Musk, Salesforce and others like Lyft and DoorDash, also feed the list of companies that have cut their workforce.
The experts consider that the movements in the labor market of this sector of the economy denote what could happen in the coming months, with layoffs that will spread to other sectors and industries in the country.
"This is a harbinger of what will probably happen later this year throughout the economy," said analyst and RSM boss Joe Brusuelas in an interview with Fox Business.
Brusuelas explained that the wave of massive layoffs in the technology sector will inevitably reach other sectors, since what happens in these companies is result of natural adjustment to the conditions that already reached them from the post-pandemic stage.
âWith respect to technology, this is just the natural consequence of several years of labor accumulation and adjustments to a new era of higher interest rates and the end of easy money,â he added.
The forecast makes sense from the perspective of the Federal Reserve (Fed) which has been fighting inflation since last year to return to the 2% target by raising its key interest rates.
However, the Fed's objective will be difficult to achieve if the labor market does not cool down and wages force workers to reduce their consumption, with a view to making prices fall more noticeably.
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