Around 194,000 US Employees Laid Off So Far In 2023: Report

LAYOFFS have continued to make headlines in the first half of this year. As we enter into the second half of 2023, one of the biggest concerns for salaried employees is whether their jobs will remain safe. In a startling revelation, Forbes’ layoff tracker has disclosed that around 194,000 US employees lost their jobs in over 150 major layoffs so far in 2023. The Forbes’ layoff tracker is based on layoff counts affecting more than 100 positions across sectors, including tech, banks, media, and manufacturing.

Most companies go for layoffs either as a cost-cutting mechanism or as part of organisational restructuring. A deteriorating economy has brought about a series of mass job cuts across corporate America, from banking giants such as Morgan Stanley to big tech firms including Amazon, Microsoft, etc.

The number of individuals filing new claims for unemployment insurance in the US for the week ended June 3, 2023, rose to 261,000, said a report by the US Department of Labor.

This figure was the highest point in nearly two years in the wake of layoff announcements in the tech industry. The initial jobless claims for the week ended June 3, were 28,000 higher compared to the previous week, which was revised up from 232,000 to 233,000.

According to Forbes' layoff tracker, tech companies faced the brunt of major layoffs in 2023, with the biggest round of cuts coming at tech giant Google's parent company - Alphabet, which retrenched 12,000 employees in January, a decision CEO Sundar Pichai termed one of several “tough choices” to “fully capture the huge opportunities ahead".

Forbes further said that over 74,000 US employees lost their jobs in major layoffs in January alone.

Companies operating in the tech sector faced the brunt of major layoffs in this year, with the biggest round of cuts coming at tech giant Google parent Alphabet, which retrenched 12,000 employees in January.

Late last year, the e-commerce platform Amazon announced plans to cut over 18,000 positions.

Here’s a list of companies that announced major layoffs in US:

Microsoft

Tech major Microsoft announced a round of cuts in January affecting as many as 10,000 employees, while in February, Microsoft-owned internet technology company GitHub laid off 300 positions, and in May, Microsoft cut another 158 employees in Redmond, Washington.

3M

Manufacturing giant 3M also underwent multiple rounds of layoffs in 2023, cutting 2,500 positions in January before slashing another 6,000 jobs in April.

Meta

In two separate rounds of cuts this year, Facebook parent company Meta laid off 4,000 of its roughly 87,000 employees in April, and another 6,000 in May. Meta slashed another 11,000 (almost 13% of its staff) in November, 2022.

Other companies to see major layoffs this year include Morgan Stanley, which slashed 3,000 positions in the month of May, David’s Bridal, which slashed more than 9,200, Dell, (6,650), and Disney (7,000).

Why are tech companies leading the job cut race?

It is usually seen that IT Companies do not fare well amid rising interest rates due to valuation pressure. High-interest rates increase the costs of borrowing, creating an unfavourable scenario for high-growth tech companies that look for expansion and thus burn a lot of cash.
Besides, when interest rates rise, investors look at bonds as safer investments, and thus in such conditions we see a lot of money rotating from the tech sector into the bond market as yields rise.