Thousands of employees in the technology and real estate industries are being cut, as companies both large and small curtail ambitions and brace for tough times ahead.
|Amazon is laying off approximately 10,000 people starting this week |
In the technology industry, Amazon is laying off approximately 10,000 people starting this week, according to the New York Times, in what would be the largest job cut in the company’s history. The cuts will focus on Amazon’s devices organisation, including the voice assistant Alexa, retail division, and human resources.
Amazon’s planned retrenchment during the critical holiday shopping season — when the company typically values stability — shows how quickly the souring global economy has pressured it to trim businesses that have been overstaffed or underdelivering for years.
Last week, Meta CEO Mark Zuckerberg started cutting 11,000-plus jobs after admitting over-optimism about online growth had led to overstaffing, the Wall Street Journal reported.
Earlier, Twitter's new owner Elon Musk slashed half its 7,500 Twitter employee base. Thousands of workers found out after being removed from chat groups and unable to access internal system accounts before receiving a resignation email.
In early November, many departments at Apple received notice that they would not be receiving new employees, with hires ceasing until at least September 2023.
From the middle of this year, Microsoft said it would remove some positions to reorganise operations, and about 1 per cent of employees subsequently lost their jobs. Amazon is also looking to optimise resources after a period of hot expansion during the pandemic.
Roger Lee, CEO of Layoffs.fyi, said that the second quarter of 2020 still ranks as the worst three-month period for lay-offs since the pandemic began, “but this year is shaping up to be grimmer for job cuts than 2020 overall.”
Financial statements from Alphabet, Amazon, Meta, Microsoft, and others reported falling short of projections, sending shares plunging and shaving up to billions of dollars from their market valuations. Meta has lost more than 70 per cent of its value so far this year, with investors uncomfortable with the amount of money being pumped into an immersive digital metaverse.
|“This layoff assumes the downturn will last at least through 2023," CEO Glenn Kelman. |
The continued drop in housing demand in the US due to high-interest rates combined with the economic downturn has created another wave of layoffs in the real estate industry.
Seattle-based Redfin, a residential real estate brokerage, is set to shutter its home-flipping business and reduce its workforce by 13 per cent, laying off 862 employees, and approximately 218 employees will have their current roles eliminated but are being offered new roles within the company.
In June, Redfin laid off 8 per cent of its workforce due to the slowing housing market. Through layoffs and attrition, the company said it had reduced its total number of employees by 27 per cent since April. Its CEO Glenn Kelman wrote, “This layoff assumes the downturn will last at least through 2023."
According to CNN, thousands of employees in Opendoor and Zillow in the United States have been laid off over the last month.
| ||Domestic businesses face severe cash shortages |
A lack of capital is making it difficult for businesses to maintain operations.
| ||Real estate investors hitting capital wall |
Real estate businesses are struggling to manage, with capital mobilisation channels narrowing, while businesses are operating in moderation, cutting investment, and waiting for policy easing.