What’s not being said about the layoffs happening in tech right now

If you work in tech, you’ve no doubt seen that the current trend is companies cutting headcount across the board, at all sizes and in just about every sector of the industry.

Layoffs.fyi has been keeping track, and there are many big-name, reputable companies that have been laying people off since the beginning of the year, with some companies going through multiple rounds of reductions.

It’s hard to look away when new companies are being added to the list every single day.

In the comments and replies to the announcement threads and Tweets, you see other tech founders consoling the founder who just laid off teammates with a “sorry to hear that, [insert tech founder name], I’m sure it wasn’t easy”, while tech employees chastise the founder for their stupidity in letting it get to this.

While the founder blames the economy — rightfully so in many cases — that’s definitely not the whole picture of what’s going on and why profitable tech companies are firing employees.

What’s not being said is that founders, boards, and investors are using this economic downturn to either (1) get rid of their weakest employees or (2) reorganize their business, both under the air cover of layoffs. In some cases, both are happening.

I’m not here to pass judgment on these companies, because I do think that it’s important to operate with the best team possible and to reorganize as needed. But I also know that a lot of this could have been avoided if management at these companies spent a bit more time thinking about the downside risks of their companies as they took on so much bloat and refused to make hard decisions over the last few years.

Let’s not kid ourselves that the cycle won’t repeat itself in the future.

The economy will recover. Hiring will recover. Companies will over-spend.

Do yourselves a favor and stop being so sure that you’re going to hit your projections, and start thinking about what happens if you don’t. You — and your company — need to be prepared for both.


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