Every day there’s more big job cuts at tech and games companies. I’ve not seen anything explaining why they all seam to be at once like this. Is it coincidence or is there something driving all the job cuts?
this post was submitted on 25 Jan 2024
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Lots of tech companies saw huge growth during covid thanks to everyone having extra money to spend (see crypto and NFTs if you want clear examples that we just had too much laying around).
Many of these companies then saw their revenue and userbase increase month-after-month and thought the growth was going to continue forever (or, more cynically, they knew it was going to crash but acted like it was going to continue). This led to a bunch of hires to "drive growth."
But obviously, pandemic spending habits have mostly stopped, and the money faucet is being turned off. Companies can't afford all the workers they hired, so they're "let go due to market downturns."
TL;DR Companies either thought they were going to have unrealistic growth and made dumb hiring decisions, or knew the growth was going to end and thus made cruel hiring decisions.