Read to the end for chart manipulation.
If you've taken even a cursory look at the news in the last week, you have likely seen the headlines. Talk about a bloodbath in tech lately. What do we name this? The Great Backlash? The Great Hiring Miscalculation? Or is it something more simple: The Great Inability To Plan Headcount?
I'm not saying staffing a company is easy but look at the numbers courtesy of Daring Fireball:
Amazon: 18,000 (then announcing 50% of their Comixology division)
That's 58 THOUSAND people out of jobs in less than two months. And funny enough, these companies are still posting (just a little less) profits. Based on reporting from numerous outlets, it looks like the downturn in tech is likely to continue for the first half of the year at least.
But what's the cause of this aside from less millions coming in the door?
When the pandemic began and people shifted to working from home, there was not much of a blip for tech companies. Inherently they were designed to have work done from anywhere and in my opinion was more of an adjustment for workers than companies. No company has gone under because remote workers couldn't do their job.
We then saw the Great Resignation where employees decided on new table stakes and looked for new roles. And here is the rub: All these companies doing massive hiring were wrong. They jumped to hire thousands of people without thinking long term about how to slot these people into a company one, three, or five years down the road. To me, it seems the mantra was to scoop up talent now and ask questions later.
One glaring omission to the list of companies shedding people is Apple. Given their size, it begs the question of "how?" because they're a massive company.
The Wall Street Journal dove into this and the numbers give all the answers. Apple hired less than any other Big Tech company.
From its fiscal year-end in September 2019 to September 2022, Apple’s workforce grew by about 20% to approximately 164,000 full-time employees. Meanwhile, over roughly the same period, the employee count at Amazon doubled, Microsoft’s rose 53%, Google parent Alphabet Inc.’s increased 57% and Facebook owner Meta’s ballooned 94%.WSJ
Those percentages are eye-opening. Meta doubling their employees in three years, especially when they're in a tailspin, is ludicrous and everyone in charge of hiring there should be part of their exodus. Even when you compare Apple to the lowest-growing company, they are less than half the growth of Amazon.
One thing to keep in mind is Apple has cut headcount in their retail stores but the numbers are vague. It is also difficult to do a 1-to-1 comparison between Apple to others because they're the only ones to run a massive chain of stores. Retail is a different beast than corporate jobs.
Now the answers to those delayed questions are seen: massive layoffs. Each PR release from a company about layoffs involves some form of "changing landscape" and "being sorry" which doesn't do much good for the affected people.
While I don't expect any of these c-suite execs to have a crystal ball I do expect them to do better for their people. Wall Street has forced companies to maximize shareholder returns and focus strictly on value every three months. And in turn, at least from what I can see, a short-sighted view on keeping the right amount of people on board for the long term.
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TODAY'S RANDOM FACTOID
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