19 employees seems such a small number that you can’t but think they could have as easily not fired them and just cut everyone’s pay?
Doing a round of layoffs - especially done respectfully - can soften the blow a little while requiring only senior leadership's buy in and some input from managers. Convincing everyone to take a 15% pay cut takes a ton of coordination across the entire company and probably drives the rumor mill fast and furious. And imagine being one of the people who says "no"!?
Further, with layoffs, you can choose who to cut. If people get demoralized as you're negotiating pay cuts, the top people can pack up and leave.
I don't like any of it but it makes sense.
It's definitely contextual to some extent. We're in an industry that's going to take a revenue hit, but the sustainability of the company isn't in question. Doesn't help that the company could afford nearly a billion dollars in stock buybacks in the last year, either.
I think one of the big takeaways for me is that it's burned any good will the company had with a lot of its employees. I expect pretty heavy turnover once hiring starts to thaw again and I'll likely be part of it.
Whenever I've been at a company when jobs are made redundant the same thing happens - everyone worries that their job will go if there's another round of cuts and morale plummets. That usually pushes more people to find new jobs, and it's ofter the people who are good because they can get new jobs more easily.
There is no winning strategy for cutting costs.
But there are better and worse ones. Cut once and cut deep is close to as good as it’s going to get.
Priority number 1 is surviving.
I hope they at least gave you notice so you could adjust and prepare instead of day-of/before "Hey, by the way!" Granted, a lot less people in tech are living paycheck to paycheck but it happens. Getting pinched there would be awful.
Regardless of how these things - layoffs, pay cuts, whatever - go down, doing it with respect is key. After all, these are the people we've worked with, helped each other, and probably had a drink or two with. We're not family but we are human and it's a small world.
I worked at a place that went through hard times and the employees that stuck around were 'untouchable' in the owners eyes, for better or for worse.
(sorry pickers for that rude language, you know that you are more important now than said top performers)
One reason might be that economic recessions are an excuse for a manager to, from their perspective, permanently "increase efficiency", i.e. make remaining employees do more work, while for cooperative and strong union organizations, the focus is to preserve their social bonds and help each other.