How does that follow? The conclusion would be that both the companies and workers suffered unnecessarily for 2 years, with no long-term benefit afterward to the layoffs. In other words, you should just ride out the downtimes instead of panicking.
After 3 years, what group would you expect to perform better financially? And if we told you it was a tie, you might ask: what did group 2 to improve their situation? Layoffs? Ok, sounds like they worked.
None of the big tech companies are in a "dire" financial situation. Indeed, some of them have just announced modest revenue increases this week. Yet they still conducted big layoffs. Did they "need" to do it? (Note in contrast that Apple announced a significant revenue decrease yet didn't panic and do layoffs.)
Did they "need" to do it?
It's kind of like me having plenty of money, right now, to afford Netflix but cancelling it anyway because I feel $14/mo or whatever the price is still too much for the value it delivers in the current year, and generally worried that I might need that $14 in a year (multiplied out across a bunch of other services or habits I engage in). I'd rather save my money now, as I've decided the situation is dire or could easily become dire. Am I actually cruel and obligated to keep my Netflix subscription (gotta make sure Netflix employees make a living) because I am not, at this moment, in what others perceive to be a "dire" situation?
What if you're wrong, though, and indeed what if many people are wrong in the same way, cancelling Netflix and passing up the opportunity of enjoyment to save a little money, but in the long run it makes no difference, and only hurts them in the short-term by depriving them of the enjoyment? That's the point of the article, that layoffs are empirically self-defeating.
It's not about a mythical "obligation" to employ someone. The cruelty comes from laying off people unnecessarily, when there's no benefit.
But then they also didn’t massively increase their headcount over the previous 3 years. Steady as she goes, as always.
I would say that Apple is in the unique position of being particularly volatile since they rarely post losses. If they posted a decrease AND did layoffs, I'm sure some of their brightest would jump ship, and stocks would tumble further.
Plus they didn't really do a strong round of hire during the past few years.
Companies do layoffs all the time, even when their financial situation isn't dire.
In any case they’d still have lost two years of growth when their competitors were.
Companies layoff when they're in some sort of trouble. If you don't have the cash to support the staff, you can't will that into existence.
So it follows that companies that laid people off struggled for a bit. Because they were already struggling. It's not an instant cure, or even a guaranteed one. It's a measure to spend less so you can ride out the downtimes.
Another way of stating it is that "People who were sick with the flu seemed to tire more easily in the days that followed compared to people who weren't sick at all". It's to be expected.
No, companies layoff when they want to spend less money paying people. Being "in some sort of trouble" is only one of many reasons why they may choose that course.
You should think harder about what might drive layoffs.
In that context I was told, "Tutor this guy (a fair worker, but not exceptional). We're going to let him go if he can't step it up." We worked together and I saved his job - it remains a very proud moment for me.
The company was a leader in its field, and its merciless practice of retaining only the very best performers contributed to its success.
Capitalism at its Darwinian worst, perhaps. Or its best, depending on your perspective.