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Comment by MuffinFlavored | Hacker News Reader

> It will be ~7% layoffs every quarter at every public company until the stock is attractive to investors again.

This was one of the biggest things I felt wasn't being talked about in all of the layoff comment threads here on HN (or Reddit or Twitter or traditional media news sites or wherever)

It wasn't a 1 and done "cut the bottom 5-10% off and move on"

I mean, I/we don't really know for sure if that's how it plays out but...

https://www.bloomberg.com/news/articles/2023-02-16/fed-s-mes...

https://tickertape.tdameritrade.com/market-news/ppi-data-com...

Not only does it seem that we aren't out of anything recessionary yet, it's as if we are only just at the very beginning/it hasn't started yet.

Thoughts?

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I am in the same camp as you. But I think the approach of "cut x% over and over" to keep the stock afloat at some point is not going to work forever, since a company is not very competitive at 0% of its original engineering / get things done work force. Heck if the markets were truly free markets and stock price was based on fundamentals, we may even start to see highly paid senior leadership cuts over lower level employees. Call me crazy.

> Heck if the markets were truly free markets and stock price was based on fundamentals, we may even start to see highly paid senior leadership cuts over lower level employees.

GOOG did this. Lots of Directors and VP got cut.

META "flattening" will impact highly paid senior leadership as well.

> But I think the approach of "cut x% over and over" to keep the stock afloat at some point is not going to work forever, since a company is not very competitive at 0% of its original engineering / get things done work force.

Let me ask you this.

If we can correlate (which I think we can) "a tech company should have X headcount when the Federal Funds Rate is 0.25%" and "a tech company should have Y headcount when the Federal Funds Rate is 5.25%, where X is less than Y", I'm going to guess most tech companies just play it by ear/quarter by quarter (like the rest of the economic/financial markets based on all sorts of reports/data that come out incrementally over the year)

Right now, maybe companies haven't done enough layoffs to get their headcount to where it needs to be if the Federal Funds Rate is the full blown "doomsday" terminal 5.25%. Maybe companies are doing it incrementally and waiting to see if the Fed will pivot, because they have to keep in mind how expensive re-hiring people to chase growth will be?

Not sure I can correlate these things. We just have 1 little data point, a recent surge of articles about layoffs in the news. The real labour stats are showing record employment levels.

Would it make sense to hire as many people as possible right now, to lock their salaries in at a much lower price than it will be in the future, due to inflation (if they think the pivot is coming)? Just throwing random ideas out but I do know one thing, I know very little :P

> we may even start to see highly paid senior leadership cuts over lower level employees

Thanks. I needed a good laugh this morning

Yeah tech stocks need to compete. These companies sell ads. They don’t need teams working on bullshit like optimizing talent acquisition pipelines or whatever.

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