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Comment by emodendroket | Hacker News Reader

> The irony is that these same companies were talking a year ago about people as their most important asset, and now they're treating their employees pretty badly, laying them off via email or by abruptly cutting off their access to the company. These layoffs are a decision that reflects the company's values, and these companies have basically given their employees the middle finger.

I have to wonder if this is entirely incidental. Sudden layoffs can also help maintain labor discipline, which a lot of business leaders felt was getting away from them.

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> Sudden layoffs can also help maintain labor discipline, which a lot of business leaders felt was getting away from them.

We saw this theatre at my employer. A mandatory all-company meeting called with a few hours notice, lots of stern faces and vague ominous talk, followed by "you will be notified in the next moments if you are being made redundant".

They are a huge company whose name you would almost certainly recognize. We found out later that the total number of people let go was....5. That's how many people we hired in our group alone the previous month. It was just a show.

Bread, circuses, whips and chains. Spicy.

> Sudden layoffs can also help maintain labor discipline, which a lot of business leaders felt was getting away from them.

It's probably more about that than about cutting costs.

Once sufficient fear has been instilled, the next stage will probably be across-the-board pay cuts.

> Once sufficient fear has been instilled, the next stage will probably be across-the-board pay cuts.

Not saying you are wrong but it's common knowledge now that the best way to secure a pay rise is to find a new job.

So I expect that a fair number of employees faced with an actual wage reduction in a time of pretty significant inflation will feel motivated or even forced to find new employment. Which in turn will mean that when the firms go to replace those workers, which for the most part they eventually will want to do, they will wind up having to pay a higher wage to attract the same level of talent and competence.

> they will wind up having to pay a higher wage to attract the same level of talent and competence.

Will they?

'glanzwulf here[0] is making a not so tinfoil-hat point that widespread layoffs create an atmosphere of fear. At this scale, the people who were laid off may no longer feel so sure about their prospects of finding a new job quickly - so they might just be willing to compromise for a lower salary, just to secure some job. For the first time since... ever? software developers might experience the job market the way everyone else does - that is, one where employers hold all the power, and employees are happy to take whatever they're being offered.

[0] - https://news.ycombinator.com/item?id=34967091

You are delusional if you think that "everyone" else is powerless in front of their employers. There's many widely unionized profession where there balance of power is between employers and employee is fairly balanced, sometimes more so than software engineering.

My point is rather that the power in software industry was, so far, heavily imbalanced, disproportionately favoring the employee. This is, if not unique, then at least a pretty rare situation.

Unionized professions may be fairer than non-unionized, but compared to software dev pay, unions only turn a shitty salary into merely meh salary.

Sure, tell that to actors.

They'd surely agree - if I made sure to ask all actors (or a hypothetical average actor) instead of just the popular ones.

That includes many people who are on TV or in movies a lot! Most of them are not Tom Cruise and are more or less expendable.

Right. Average acting income for members of the Screen Actors Guild is a few thousand a year. They're all part-timers, really, always looking for the next gig.

You look for new job while you're at old one. There's no risk unless you significantly change the category of company you work for.

People behave in irrational ways like not interviewing for a job they’re not sure they’ll accept. And they certainly have more trepidation about taking a new job now because they don’t want to be the new guy if staff cuts happen and they’re going to scrutinize company stability much more.

That makes sense if you're trying to jump ship, but for unexpected-ish layoffs? Job offers have time limits. Am I supposed to be interviewing all the time, so that I always have some warm offer when I suddenly need it?

> the next stage will probably be across-the-board pay cuts

This doesn’t happen [1] because wages are sticky [2].

[1] https://fred.stlouisfed.org/series/PI

[2] https://en.m.wikipedia.org/wiki/Nominal_rigidity

Now that we are once again in an inflationary environment, simply keeping wages the same amounts to a significant across-the-board real pay cut over a year or three.

They had the foresight to make a lot of the wages variable comp so this is less of a problem.

Er, no.

* Intel pay cut earlier this month.[1]

* Amazon pay cut earlier this month.[2]

* 50% pay cut for new tech hires in India.[3]

[1] https://www.oregonlive.com/silicon-forest/2023/02/intel-slas...

[2] https://fortune.com/2023/02/21/amazon-staff-pay-50-less-expe...

[3] https://www.bbc.com/news/world-asia-india-64728508

The Amazon story is what I’d expect — no nominal cuts but in practice it’s much less than anticipated — but I have to confess that I was pretty surprised at the other two, which are outright cuts.

In practice this is happening a lot through inflation, reduced stock grants, etc.

> most important asset

talk is cheap.

Action reveals true intentions.

And tbh, anyone who believes that they will not ever be laid off (and only ever voluntarily quit) is delusional. Whatever a company claims - "you're like family", "important asset", "valuable talent", etc - nothing compares to cash and profit. The shareholders do not suffer losses to prop up a business or employees.

> Sudden layoffs can also help maintain labor discipline

And layoffs will also slow wage growth. So I wonder, did they all agreed to this at Davos?

They don’t really have to all get together and agree given their similar interests. Read “Political Aspects of Full Employment” for a longer exploration of this idea.

"The beatings will continue until morale improves"

Why would you want labor discipline during a potential downturn? You get it for free!

You want labor discipline in a boom so you don't get taken to the cleaners.

> a lot of business leaders felt was getting away from them

How did you source this?

Does labor discipline even have a robust definition?

Keep in mind this downturn is largely created by Fed policy receiving support from the same tech companies it’s causing to lose money. Say what you will about the previous inflationary environment but it certainly wasn't hurting the financials of big tech.

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