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Comment by theptip | Hacker News Reader

I just don’t buy it. To be clear this is claiming that the CEOs are sitting behind a desk stroking a cat, thinking “now I will crush the labor movement and make all my workers feel less secure”.

This is just not a problem that Pichai is facing.

Occam’s Razor points to the very simple, non-conspiratorial answer that it really is just stock-price driven (ie market-driven) thinking (one could say “lack of actual strategic thinking”). “The job of Alphabet is to provide solid growth in share price Q on Q for investors, with minimal fluctuations to spook them”, seems a more likely thing for CEOs to be saying, after hearing this from their CFOs.

The idea that Google would struggle as hard as it did to meet its aggressive hiring goals over the last few years, then axe strong engineers just to make others scared, really stretches my credulity.

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I think you’re applying a “conspiratorial” vibe that isn’t necessary - employers are naturally incentivized to keep employees insecure and underpaid (relative to what they’d be paid if they organized, at least). It sounds like you’re knowledgeable on these topics, so I’d be surprised if you disagreed with any of these assertions:

1. Big tech would be willing to burn billions of dollars to crush any chance of tech unions forming.

2. Big tech is known to collude (even to conspire! ) to keep tech wages depressed.

3. Big tech’s biggest cost, by a huge margin, is labor; any reductions there could easily dwarf other shareholder-appeasing cost cutting measures.

4. Tech worker salaries have skyrocketed since they lost their collusion lawsuit, and the general sense among big tech workers was (in most cases) “they need me more than I need them, I could find another amazing job no problem by just responding to one of the many recruiters badgering me on LinkedIn”.

Speaking just for google, 6 months ago all the internal forums were obsessed with the idea that SWEs were underpaid, that google should give raises to match inflation, and that google no longer paid top of market. Today I’m pretty sure 100% of the top posts on the biggest internal forum are about layoffs - how random they seemed, how anxious people are to see if they’re going to be cut, and how vastly their perception of the company has changed. If this writer’s take is close, it seems like it kinda worked.

Employers are incentivised to retain the employment of their staff, which given the existence of other companies, means they're strongly incentivised NOT to have their employees "insecure".

That's only true if there's no cost to the employee of changing jobs. And that's not true. Changing jobs is expensive and costly to the employee, especially in terms of time and stress.

If an employee is insecure in their position as a “senior Big Tech dev” (read: top 1-2% income earner), they’ll be less likely to look for other jobs, slack off knowing they could get another job, or fight for raises / process improvements / anything, really.

I guess the real point I’m making is that the “industry-wide” nature of these layoffs are an essential component.

It's not me that's applying the conspiratorial vibe, it's the OP, and that's what I'm complaining about:

> “Controlling labor costs via periodic layoffs is like breathing for Silicon Valley: cyclical, necessary for life"... The layoffs, Harris says, have “very little to do with long- or even medium-term strategy except as it pertains to cultivating an insecure workforce.”

This article is explicitly claiming that the layoffs are not about stock price, they are about an intentional cultivation of insecurity in the workforce and an attempt to crush unions.

I'm aware of the no-poach collusion case, but I'm a bit unclear on exactly how much that impacted wages; do you have any go-to sources supporting your claim 4. that this case had a big impact? A quick search gives https://angel.co/blog/software-engineer-salary for example that doesn't show any appreciable impact in 2011 when the class-action suit was filed. (There is a massive jump in 2020 when everyone started hiring like crazy in the Covid bull market.)

I'm not claiming this factor has zero weight in the causal model, but the OP is saying something like "this is mono-causal; it's not stock prices, it's an anti-union/anti-labor conspiracy". If pressed to guesstimate I'd say the anti-union factors can't be more than 10% of the explanation, and I'd be surprised if it's even that high.

I agree that it isn’t mono-casual (cool word!), but I’m still convinced worker sentiment (which I’d classify union membership as a derivative issue of) is the main reason. I have lots of thoughts about where this fits into their priorities in general, but most of my proof is already discussed above, so I’ll focus on this instead:

These companies are not anywhere close to laying off enough people to get back to pre-COVID headcount, and if these layoffs were intended to boost the stock price, they don’t seem to have had much of an impact. Google (sorry I think about this one more than the others, for obvious reasons) is up 11% MoM compared to 5% for the S&P 100, which is good, but… idk seems hard to say that’s worth the trade off. Especially considering the huge swings the stock has taken over the past few years and months

Re: impacting wages I can try to come back to this once I’m done making ads for the day. My general narrative is “the lawsuit settled, then meta started offering progressively larger packages for experienced devs, which drove up other companies offers for the same devs” but I do not have source on hand.

I don't think the parent was disagreeing with the fact that tech companies want to oppress workers, he's disagreeing that this specific instance wasn't motivated by oppression because there's a more straightforward financial incentive (ie. cutting spending on employees in light of macroeconomic conditions changing). An analogy from the flip side: I think it's reasonable to think that most consumers want to drive a hard bargain when it comes to megacorps or even businesses in general. However, if some engineer sees the tech layoffs and starts canceling some of the SaaS subscription he doesn't need, it doesn't seem accurate to paint that as "Tech workers are using SaaS cancellations to crush corporate power".

> employers are naturally incentivized to keep employees insecure and underpaid

Aren't the management also employees? They may have different incentives from those of the large shareholders too. Case in point, so many managers chase scopes by hiring as much as possible but firing as little as they can. I remember Googlers used to joke that "VPs will protect us" when it comes to downsizing teams.

You realize more than a decade ago a cartel of tech companies (two of which being Google and Apple) literally had no poach agreements in order to suppress salaries right?

https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...

But GP is incredulous about that, because a no-poach agreement would imply that they're sitting behind a desk and stroking a cat. That's an absurd thing to picture, so by the GP's logic, those no-poach agreements didn't exist. QED.

Conclusive evidence of a conspiracy does, indeed, strongly evidence a conspiracy.

Alas, this hasn't much to do with the "no evidence of a conspiracy" case.

All no evidence evidences is no evidence. A point which seems widely misunderstood.

I agree, which is why "no evidence" would have been a stronger argument. The presence of evidence of a conspiracy doesn't suggest that CEOs are, in fact, petting cats from their desks.

Even so, there is some evidence, though certainly not conclusive.

I'll clarify by saying I'm aware of the no-poach collusion, and I'm not claiming it didn't happen. I used the absurd image to highlight and undermine the conspiratorial tone of the OP.

I don't think the no-poach case was, as the OP claims, about "cultivating an insecure workforce". It simply started with Jobs getting pissed off at Google (legally!) poaching his people, and other companies he emailed getting on board with a general "don't piss off Steve" policy that grew. While it's conspiratorial in that a bunch of execs were coordinating, I don't think it represents cultivation of insecurity or any explicitly anti-union intent.

>I used the absurd image to highlight and undermine the conspiratorial tone of the OP.

The absurd image doesn't undermine their assertion, because you just made it up. The logic in your rebuttal was nonsensical: "This conspiracy theory evokes an image of a villain petting a cat, and that is an absurd image, therefore the conspiracy theory is absurd."

> I just don’t buy it. To be clear this is claiming that the CEOs are sitting behind a desk stroking a cat, thinking “now I will crush the labor movement and make all my workers feel less secure”.

This would be a more credible claim if big tech companies, specifically, hadn't been caught doing basically exactly this, in the not-so-distant past.

"Not a problem [they are] facing"

Not sure why you think that given that labor is their biggest expense. They have been known to collude

https://knowledge.wharton.upenn.edu/article/silicon-valleys-...

Same. It sells papers right now to paint CEOs as these omniscient villains who's only goal is the crush their workers, but I just don't buy it. There are plenty of CEOs like Satya Nadella who seem like pretty decent people. I'm sure some companies see this as a way to drive down worker leverage, but I think a lot are just reacting to the market change and realizing they have more employees than they need in areas that they don't feel will be profitable in the future.

I also think there's a bit of follow the leader going on, where, now that layoffs have started, no one wants to be left at a disadvantage. If you do layoffs that you may not actually need, at least you're staying on par with your competition. If you don't do layoffs and the market gets worse, you risk falling behind.

Ironically the 4700 people at the NYT aren't the happiest bunch right now either. The bigger the company the weirder relationships with employees, 'associates' and consultants gets. In large orgs noisy, brown nosing people often do very well regardless of talent. In our era this seems to be a card to play against the firing squad selection algos. People who forcefully push for inclusion of trendy ideas and movements (DEI, Climate anxiety etc) into the core of the firm can be perceived as not in the best interests of the giant money making machine, which like a shark has to keep swimming forward to survive... and bean counter pseudo innovators like Satya Nadella quietly wield the mallet..

https://www.nytimes.com/2022/12/07/business/media/new-york-t...

What frustrates me most is that a lot of people recognize that there are issues in the labor market but the conspiratorial belief makes things way harder to solve because we don't even know what the problem is. I see this happening in a lot of areas in both economics and politics. It does seem that people like this story of omniscient evil people better than incompetent selfish people. Like we've seen how inefficient bureaucrats are and it is well known, but while holding this belief people also hold a belief that they are led by super geniuses that have what is really impressive levels of collaboration. The two just can't true at the same time.

So I'll give an addendum to Occam's. Godelski's Razor? Never attribute to conspiracy what can be easily attributed to emergence.

It's because people are trained to think in terms of individual actors instead of systems. They're also trained to think their country's system is great if not for the X, Y, Z people ruining it. Of course, those who are educated and those with power often have to face the reality that we must focus on systems and processes.

It's not "conspiratorial" to assume corporations are invested in extracting the highest labour power at the lowest cost. It's what they are designed to do in the system we have.

> It's not "conspiratorial" to assume corporations are invested in extracting the highest labour power at the lowest cost.

This isn't what any of us (at least me) are calling conspiratorial. The conspiratorial nature involves the... conspiring part. That organizations are in fact not doing what I quotes but instead working together in back rooms to help maintain the elite statuses. While this happens to some extent, it is not this Bilderberg group type things. If individual elite companies and billionaires independently lobby for their personal self interests then others of that same group often benefit from the same things. This should be unsurprising. But it doesn't require collusion, it just requires statistics.

It is not Dems and Reps plotting in back rooms to make Americans fight and hand over power to billionaires. You're watching too many movies. The easier explanation is that they all come from the same types of families and have gone to the same types of schools. They don't need to conspire because they already have the same reference frame of the world. They're not omniscient, they just have the same biases in their priors. But that's not conspiracy, that's emergence.

A perfect example of the conspiracy we are talking about is the top comment. I am willing to bet that theater was closed (primarily) due to the pandemic rather than because they wanted to squash these performers' demands. But as the old saying goes: never let a tragedy go to waste. The judgement of intentions are being made based on the outcome, and in many of these cases could not have been predicted apriori. So either the owner got "lucky" or they were omniscient. If the latter, why the fuck are they running an theater? The same can be said about a lot of common beliefs.

The outcomes might be similar or look the same as if these mega smart people planned all this, but that's a bias seeing the "successes" and ignoring the failures (a quite common human trait). The difference between these two views may not matter in terms of outcomes, but it sure does matter in terms of preventing the same things from happening in the future. Frankly this is the key failure point of many suggestions for how to resolve these issues and why we have decades or centuries of attempts that result in failures. Because we aren't looking at the complex causal chain of events (which we can't even know beyond a certain level of accuracy and is constantly changing).

The tone of your comment reads as if you're disagreeing with my comment but you're in fact agreeing? I'm a bit confused. :)

A slight disagreement FWIW, > Frankly this is the key failure point of many suggestions for how to resolve these issues and why we have decades or centuries of attempts that result in failures. Because we aren't looking at the complex causal chain of events (which we can't even know beyond a certain level of accuracy and is constantly changing).

I believe that is true in the West more than anything. It's hated on HackerNews (an obviously neoliberal culture) but there is a reason any good economics program teaches Marxist thought.

What I'm disagreeing with is the way you use the word "conspiratorial" because it is not aligned with the usage in the previous conversation (i.e. multiple people were using it with one meaning and you used it with a different meaning).

You don't even need to be mustache twirly to price fix.

https://arstechnica.com/tech-policy/2022/10/company-that-mak...

How many companies these days use some third party service for setting salaries? How many use the same SAAS service?

If we are all using the same table of values, set by a third party, isn't that collusion with an extra step to launder the collusion.

And I don't buy the coincidental timing of the fed trying to push us into a recession, which they were not being successful at, following shortly with public companies like Google suddenly finding a bunch of inessential staff to cut.

It's not like Google is taking out loans for payroll, or that it was obvious that this move was necessary. These inessential employees have been inessential for years.

The standard argument is that tech companies hired-up for 2021 lasting forever, but people spent less time shopping online in 2022. The poster child for this is Peloton. On top of the shift in demand, higher interest rates hit other companies that would otherwise advertise on Google.

Did Google need to do layoffs? No. Did it over-hire for revenue that never materialized? Yes.

>It's not like Google is taking out loans for payroll

They might not be actively taking out loans, but that doesn't mean they're immune to interest rates. Higher interest rates means that a dollar in 10 or 20 years is suddenly worth less than a dollar today. That means investors suddenly care more about how many profits can be generated today, rather than whatever moonshot projects that google is working on.

> answer that it really is just stock-price driven (ie market-driven) thinking (one could say “lack of actual strategic thinking”). “The job of Alphabet is to provide solid growth in share price Q on Q for investors, with minimal fluctuations to spook them”

Fair enough, but my view is that you've just described the largest problem with the modern world.

They don't think about "crushing..." they think, "how can I improve my bonus?" Result is the same.

> The idea that Google would struggle as hard as it did to meet its aggressive hiring goals over the last few years, then axe strong engineers just to make others scared, really stretches my credulity.

A bit of a morbid counter-example: does one worry about "strong T-cells" when undergoing chemo, or strong muscle fibers during a limb amputation? The assumption that the C-Suite inherently cares about individual engineers during layoffs seems like a slight case of main character syndrome. If your department is being excised, others departments are downsizing, and the company as a whole is not hiring for your role, nothing can save you. Layoffs are not perfectly planned and executed with surgical precision[1], they are messy and approximate.

1. I realize the irony of using "surgical precision" after my earlier counter-example of the imprecision of amputations.

> it really is just stock-price driven

The two are not mutually exclusive. The infamous TCI letter even draws a line between out-of-control employee compensation and stock price. Rightly or wrongly (and in my personal opinion wrongly) the common view in finance is that employee power is bad for business.

There also might be other forces pushing for those on the background. There are several articles claiming that activist investors pushed for the layoffs: https://www.marketwatch.com/story/hedge-fund-billionaire-goo...

Dynamics like this wouldn't be unheared of. I hear that part of the reason airlines don't frequently computer on price is that investors don't like it because they typically invest in multiple airlines and don't want their investments to compete for slices of a pie by shrinking the pie.

Is it even collusion if I just do what my investors are asking me to?

They were already caught conspiring to keep wages down, found guilty and paid huge sums.

We've ALREADY PROVED the conspiracy.

This is the LA Times, what do you expect? This is the same paper that called a conservative black gubernatorial candidate in California "the black face of white supremacy".

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