Boom or bust in '24? | Major corps are stuck in a hiring loop that needs to end

Major corps are stuck in a hiring loop that needs to end

Over the past 18 months, we’ve seen an unprecedented volume of layoffs from market-leading firms, spearheaded by the ‘big tech’ industry.

The likes of Alphabet (the parent company behind Google), Amazon and Microsoft were responsible for tens of thousands of job cuts throughout 2023, with Crunchbase reporting that just these three firms alone shed over 38,000 staff.

Of course, as anyone who has kept up with global news headlines is aware, the wider shedding of staff throughout the year was much vaster in scope. Marketwatch data states that the tech industry has seen more than 240,000 jobs lost in 2023. This number was a stonking 50% higher than the previous year.

Now, as we look ahead to early months of 2024, the outlook isn’t much better. By the estimates of layoffs.fyi, the number of staff who have already faced redundancy within the year is swiftly exceeding 7,700 in the tech industry alone.

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Whilst by January of 2023, Google CEO Sundar Pichai had already announced a cull of over 12,000 staff, a memo sent to staff last week confirmed that the company was expecting more disruption and, therefore, layoffs to come in the months ahead.

“We have ambitious goals and will be investing in our big priorities,” he wrote in the memo, as reported by The Verge. “The reality is that to create the capacity for this investment, we have to make tough choices.”

So, what’s the key takeaway from this gloomy outlook for globalised mass redundancies? The fact of the matter is that, in times of economic uncertainty and mass change (see the adoption of AI across innumerable industries and job functions), layoffs are an unfortunate yet necessary outcome.

However this doesn’t mean that businesses should be resigned to seeing such trends into the indefinite future. There is a glimmer of hope on the horizon for some semblance of normality in talent trends. We’re now entering into the US’s top earnings season for those within the tech industry. And by the rumblings being made from analysts, some now expect 2024 to be a year of profit and growth in the space.

But as businesses across the globe look toward a potentially profitable year, one key outcome needs to change. Mass layoffs have only been necessary due to vast over-hiring on the part of these firms. This is a cycle that, in the age of long-term uncertainty, must not happen again.

It’s easy, when assessing the prospect of volume hiring, to forget that these vast numbers on spreadsheets are professionals with highly sought-after skills and lives to support. Volume hiring is of course sometimes necessary, yet so is culture, employer brand and reputation. To continue gaining industry-leading talent, firms need to understand the outcome of being seen as an employer that slashes staff on the turn of a dime, even if this is not the case.

For those who are happy to write this off as a simple fact of business, one firm to assess is Apple. One of the largest names in the tech industry, the company has a history of sourcing the most prominent talent in the market. However, due to a commitment made by CEO Tim Cook in 2023 to hire cautiously, and with intention, the firm has managed to avoid hitting headlines for inciting mass layoffs.

Cook recently stated that Apple is "extremely prudent" when looking to source talent. "What we're doing as a consequence of being in this period is we're being very deliberate on our hiring," Cook told CBS. "That means we're continuing to hire, but not everywhere in the company are we hiring. While we are still recruiting, the pace has slowed. And by scrutinising our spending, we're doing the right thing,” he said.

It's this intentional mindset, and understanding of the perception of the mass hire and fire ecosystem that has maintained Apple’s reputation as a business in which stability can be found, from the perspective of a prospective candidate. Whilst this may be an idealistic viewpoint, it’s served the company well over the past 12 months, and looks to continue serving them well into 2024.

So, should more firms take a leaf out of Apple's book and ensue that 2024 is a year in which the cycle between vast hiring sprees and steep culls in staff is broken for good? We think so. 



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