Did the pandemic really increase business so much that they had to hire that many people?
Stripe, as an example, drastically slowed down hiring when the pandemic hit expecting an economic slowdown. It then turned out that so much commerce moved to online—rather than stopped—so they ramped up hiring to meet demand.
The bet that companies like Shopify and Stripe [1] made was that COVID created a “new normal”; much of the economic activity that went online would stay there. They were wrong, so there were layoffs to correct it.
[0]: https://news.shopify.com/changes-to-shopifys-team
[1]: https://stripe.com/newsroom/news/ceo-patrick-collisons-email...
People quit after layoffs, which means attrition isn’t as balanced as when the layoffs were planned. Talent isn’t distributed equal to business need, meaning the company will lose great people who were in the wrong place at the wrong time.
Depending on how it’s executed, the company could burn bridges. Even if they do it well, some people would never come back.
It’s not like the people hired were working for free so I’ve never personally put much stock in the, “employees were screwed over.”
But again, it depends on some of the items above. If a company is doing well, less-direct revenue teams are fine. In a sketchier environment, not so.
Maybe I've been lucky, but every time I've been looking for a job I've had AT LEAST two options.
People move cities, sell houses, buy houses, give up apartments, plan their finances, and plan their career around their job all the time. Investing a year learning the ropes at a company, finding ways to fit into the structures, etc. only to have the rug pulled out from under you just as you're starting to get the hang of things...
> and they probably got severance packages for more than the average American makes in a year.
Maybe I've been unlucky, but I've never had a job where my expectation of a severance package was anything more than 2-4 weeks wages.
The FAANGS have severance of several months pay, which to the OP’s point, is likely more than the annual median wage in the US.
These laid off workers have some of the best “job loss” conditions around.
Those jobs don’t exist. If there are they are such a minuscule number of openings it is not worth thinking about them.
> If you took a calculated risk and took the job anyway, well that’s on you.
Let me break it to you: almost everyone works because otherwise they would go hungry, loose their home and die in sad circumstances. People who don’t are statistical anomalies.
Are you saying that by having the misfortune of not being born independently rich and working basically any job the poster “took a risk” which is “on them”?
He is saying that. Its the Puritan Christianity's mentality of blaming the poor for not working hard. Repurposed into the modern free market capitalist ideology where its used to blame the ills of the system on the victims - "You havent worked hard enough" "You werent smart enough" etc...
You got many offers precisely because a lot of companies were (over)hiring. And the fact that you had many options on the table allowed you to get a better compensation (either because you negotiated, or because everyone else did so the industry standard increased). You benefitted from these hiring binges.
When that was the case, I saw a grand total of 0 complains by tech workers that tech companies were hiring too much; it benefitted them immensely but that did not translate in any article praising CEO for taking these risks.
Could these companies keep on these workers ? Many can ! But a hallmark of good governance is having a budget and taking care of your expenses. At your household level, you can probably afford to pay for Netflix, Disney+, HBOMax and Amazon prime at the same time. And maybe you did during COVID because you were watching TV more. But now that you are back to doing more "real life" things, you maybe don't need them all. It's not that you risk being evicted because you can't pay rent; you are probably still saving a bit of money every month. But that is not a reason to not ask yourself "do I really need these all now ?" and if the answer is negative, to do something about it like cutting one or two. What is someone then told you "But look, you can currently afford all these streaming services ! You should keep paying for them all for as long as you can, and since you have them, make sure you reorganise your life to schedule some time to watch them all !".
(For just one example, a household has a single non-varying income stream and everything else is expense. Large companies have many revenue making depts, lines of business, products, etc)
I got multiple offers when I was looking for a job in 1999, 2008, 2012, 2014, 2016, and 2018
Then those people are naive. I never plan my life around an employer. I plan my life around my employability. I wouldn’t move somewhere that there weren’t other jobs in the area. Well now I wouldn’t work at any company that wasn’t fully remote
While a good principle, I'll posit there are a lot of more or less specialized professional jobs--especially at more senior levels--where you can't just walk across the street and slide into a similar role at a different company. Even if it's in the same general area, a 2 hour commute each way is probably not sustainable.
Yes I’m self aware enough to understand the irony of the only reason I fell into my role at $BigTech at 48 years old is because I did become overly specialized in enterprise dev + cloud.
If you're an embedded systems programmer, maybe you can hack on some Javascript but no one is probably going to pay you very senior comp to do junior programmer work.
It is certainly true you don't want to be too specialized in general. You didn't want to be the Y2K guru in 2001 or the world's expert in performance optimization for some specific computer architecture that isn't manufactured any longer.
When I took my current job, there were probably a few companies in the general area that would have been somewhat obvious potential matches. But it was sheer coincidence that the one I connected with first through a connection happened to be the closest major tech company to my house.
On the other side, how many jobs are (were?) available to the generic software engineer who could do the DS&A monkey dance (junior/mid) and “design Twitter” and talk about “scope” and “impact@ in STAR format (senior).
I'm not disagreeing with you, but your tone lacks empathy. Fuck them, I got mine, those idiots deserve what they got for not being smart enough.
These are real people who lost real jobs, not just some cells in an excel sheet.
Even back in 1996 when “having mine” meant making $33K a year as a hybrid computer operator/programmer, I saved aggressively. Again, I was 22 years old and had enough sense to be paranoid about depending on one specific job.
Incorrect. Many of those people already had a job when the moved to Amazon/Microsoft/wherever.
Since no one makes a horizontal movement, all the roles they vacated when moving where lower roles. And this argument goes recursively when the old company fills those roles.
This means that most people who did not have a job prior to the hiring explosion and had a job after the hiring explosion, had low-paying jobs, in very low roles.
People who had been there 12, 13, 16 years; people who had been just promoted. People who were senior management. People who were engineers. People who were on mat leave...
Management there effectively fed people's employee numbers through a random generator. And people who (IMHO naively/foolishly) gave their lives to the company suffered.
Decisions to overhire during the pandemic impacted people who had nothing to do with that decision. And not just because of the layoffs, but also because the company growth during that period was so intense that it led to onboarding and project mgmt difficulties as well.
> And people who (IMHO naively/foolishly) gave their lives to the company suffered.
they didn't "give their lives" for nothing, right? Didn't they trade it for an incredibly desirable compensation package?
But my experience when working there is that there are definitely people whose emotional (and physical) engagement with their jobs goes well beyond just what is required to get that compensation.
edit Rewritten to take into account sokoloff's remarks, thanks!
I was also hired for a remote role at $BigTech in mid 2020. Fortunately I didn’t get laid off. But I wouldn’t exactly be bitter that I got paid 50% more during the interim. I save/invested/paid off debt with 80% of the difference in take home pay.
Yes, I’ve been laid off before when I was making a lot less in 2012. I made sure I had savings then
The biggest thing I got from the pandemic is flexible work arrangements. But I and everyone I knew all wanted to get back out there. Just not back out on public transport to work. We were doing things online because there was no other option.
But once the borders opened and restrictions eased, everyone did what they said they would. Travel. Eat out with their friends. Play their old sports. Who in their right mind would think they would continue to stay home and do everything online?
Even the "experts" were flip flopping globe affecting decisions, we had no idea what the right solution was and how long it would be... 3 months? 6? Permanent?
Long term decisions had to be with numerous unknowns, it is clear now they were wrong but I am not certain I would have made the right choice either.
I wouldn't go so far to say they wanted an excuse to fire, but they definitely bet the wrong odds.
From a theoretical perspective at this level of scale the number of engineers in particular does not scale with the ebb and flow of the selling of ads to the degree of the layoffs. Many were for divisions that were not related to ads, except for getting funded by them.
Obviously if there is not funding for these other divisions because the ad business dries up there would be large cuts, but these companies are still very very profitable even on lower ad sales. So perhaps they did not have a positive ROI, and that is fine, but a far different reason than waving vaguely at interest rates.
When the risk-free rate increases, the RoI hurdle for any investment also increases. That's how economic stimulus by lowering interest rates works, by creating incentive to "try things" (by removing the incentive to "park your money").
Advertisers on Google now bid on ads based on an environment where they are more conservative (because they have better alternative investments), where their input costs have increased (labor, raw materials, energy), where some industries (like mortgage refinancing) have been dramatically curtailed directly by the change in rates, and for some companies, buying back their own bonds is more attractive than advertising on Google with a portion of their spend.
Google can look out on the horizon and conclude "OK, we had a really great business when rates were near zero; now we have a pretty damn good business with rates several points higher than that, but it's definitely not as good as it was, so we need to tweak our frugality dial in response."
It's not like all those people who wanted to travel and go out were actually making plans and booking post pandemic flights back in 2020.
We're lucky that things are solidly back to normal this soon. Not just the restrictions that kept us inside, but the massive paranoia that made many fear the outside, and some new, worse virus
Yes on the whole most people do go out and travel again, but on average much less frequently than they used to because they retained the desire but not the same habits. They find they can scratch the itch with fewer outings.
All it takes is for people to go out 20% less than they used to, averaged out, and that’s a massive shift in economic terms that can heavily impact businesses.
That said, I'm pretty sure the overall picture is that things didn't change as much post-pandemic as many predicted. Travel is pretty much back to normal. Dining out is somewhat back to normal--though you need to factor in inflation effects as well. If I drive into the nearest major city, traffic sure seems back to normal--especially mid-week. The shift to remote seen in tech is something of an outlier.
You need to provide some data to back this up, because all of the data I've seen (and all of the full flights I've been on) says the opposite.
I do want to visit friends, go out in nature and once in a while eat at a restaurant. But for me, I am so happy to wfh 80% of the time and do 99% of shopping and groceries online, that has certainly stuck. And while I am a bit more of a recluse than most people I know, almost everybody is happy to work from home at least some of the time and does far more online shopping than before the pandemic.
Maybe this varies between countries. Or social circles. I certainly see a lot traffic again so people do like to move around again and get stuck in traffic jams a lot, but something _has_ changed for at least _some_ people. A couple of years ago working from home was unheard of, now a company seems out of touch if they don't allow it at all.
As someone who lived in Atlanta during the restaurant revolution, it went from "I could do better than this at home" to most places being able to put together an interesting plate I couldn't/wouldn't do at home. And oddly, pre-pandemic prices didn't change that much when it happened.
My working theory is that restaurants only strive to be a bit better than the average restaurant in an area.
Not that I ever used grocery pickup during the pandemic, my anecdotal observation is that, at least around where I live, you see very few pickers in stores for curbside pickup at this point. Curbside delivery/home delivery/meal kits/etc. are by all indications extremely niche from what I can see. I'm sure things have changed for some small minority however.
Neither of these are true. The truth lies somewhere in the grey area between these two things.
> Who in their right mind would think they would continue to stay home and do everything online?
Hindsight is a helluva drug. Covid has made several lasting, possibly permanent, marks on society and our habits. Nobody could say what those were going to be.
The world is a lot nicer when you (correctly) assume that everyone is doing their best with the tools and the information they have to work with.
Your comment reads as someone who likes to look back on the past with all the knowledge of today as if it was so incredibly obvious.
That said there will be some significant knock on effects from pandemic that will be favorable for those companies however not as large as originally thought.
Aren't the cuts smaller in size than the increased head count going into the pandemic, which would indicate there was a shift, but not one as large as they had prepared for?
Check zoom user growth graph, something like 300% growth was common for the software supporting this transition. Not everything was positioned as good that, but the pull was there.
In business management, financial markets, hiring, investment, real estate patterns etc etc.
There have been some lasting effects, but it was always clearly a temporary, if not prolonged situation.
> it was always clearly a temporary, if not prolonged situation
Oh, they knew it was temporary, and they knew they'd do a mass layoff when that time came. This was always the plan.
And now that it's 2023, the stock market expects them to do layoffs.
Exec compensation is closely tied to share price.
Those businesses boomed during the pandemic and deflated once it was over.