Layoffs in the tech industry are not stopping. After starting in 2023, many companies, including Google, Microsoft, Facebook parent Meta, and Amazon, are continuing to reduce their workforce in 2024. Recently, Microsoft laid off a number of people in product and program management roles, affecting multiple teams and regions. Notably, despite these cuts, major tech companies continue to release new AI features and products. Here are some of the reasons cited by the CEOs of these tech giants for their workforce reductions.
Meta's move towards the “Year of Efficiency”
The parent company of Facebook, Instagram and WhatsApp was one of the first tech giants to announce job cuts, describing the first round of industry-wide layoffs as a result of the company's overhiring during the pandemic and then realizing the benefits of a leaner workforce, which led to further layoffs, CEO Mark Zuckerberg said in a February interview with Morning Brew Daily.
Thousands of employees were laid off in 2023, Zuckerberg's “year of efficiency.”
“Obviously, it's been really hard. We've parted ways with a lot of talented people that we valued. But in some ways, being leaner makes the company more efficient,” Zuckerberg said in the interview (via Business Insider).
Google CEO Sundar Pichai: Job cuts due to 'different economic realities'
In Google's case, there are multiple reasons and the company has implemented multiple rounds of job cuts, most recently in its cloud division at the end of May.
In 2023, Google CEO Sundar Pichai said the company had experienced “dramatic growth” during the pandemic, leading to hiring that was geared to a “different economic climate” than last year. And in May of this year, Pichai told Bloomberg that the company would eliminate some teams entirely to “improve velocity.”
He noted that further job cuts will occur in the first half of the year, but the pace will slow in the second half.
He noted that the company is also “redeploying people” to its “top priorities,” which include development of ARM-based CPUs and AI projects such as the development and implementation of Gemini across Google and Google Workspace apps.
Microsoft cuts jobs to restructure and invest in key areas
Google isn't the only company restructuring its workforce to make room for AI: Its AI rival, Microsoft, has also blamed the new technology for job cuts.
Microsoft Chief Executive Satya Nadella said in a memo last year that consumers are also optimizing their digital spending, but new technologies are forcing the company to take a position as well.
“First, we saw customers accelerate their digital spending during the pandemic, and now we see them optimizing their digital spend to do more with less. At the same time, advances in AI are enabling the next great wave of computing, and we are transforming the world's most advanced model into a new computing platform,” Nadella said, adding that the company will continue to hire in “key strategic areas.”
IBM, Salesforce and other companies cut jobs
In May 2023, IBM CEO Arvind Krishna predicted that AI and automation would replace 30% of HR and non-customer-facing jobs within five years. The company laid off employees in March 2024.
Discord CEO Jason Citron said in a January memo that the company's employee headcount has grown fivefold since 2020, which could be related to the recent layoffs.
Like Zuckerberg, Salesforce CEO Marc Benioff also blamed overhiring during the pandemic for job cuts in 2023. He said that while revenue had increased, the economic downturn made the cuts necessary.
In announcing the company's 2023 job cuts, Dropbox CEO Drew Houston said the next phase will require different skill sets, with a focus on AI and early-stage product development.
Meta's move towards the “Year of Efficiency”
The parent company of Facebook, Instagram and WhatsApp was one of the first tech giants to announce job cuts, describing the first round of industry-wide layoffs as a result of the company's overhiring during the pandemic and then realizing the benefits of a leaner workforce, which led to further layoffs, CEO Mark Zuckerberg said in a February interview with Morning Brew Daily.
Thousands of employees were laid off in 2023, Zuckerberg's “year of efficiency.”
“Obviously, it's been really hard. We've parted ways with a lot of talented people that we valued. But in some ways, being leaner makes the company more efficient,” Zuckerberg said in the interview (via Business Insider).
Google CEO Sundar Pichai: Job cuts due to 'different economic realities'
In Google's case, there are multiple reasons and the company has implemented multiple rounds of job cuts, most recently in its cloud division at the end of May.
In 2023, Google CEO Sundar Pichai said the company had experienced “dramatic growth” during the pandemic, leading to hiring that was geared to a “different economic climate” than last year. And in May of this year, Pichai told Bloomberg that the company would eliminate some teams entirely to “improve velocity.”
He noted that further job cuts will occur in the first half of the year, but the pace will slow in the second half.
He noted that the company is also “redeploying people” to its “top priorities,” which include development of ARM-based CPUs and AI projects such as the development and implementation of Gemini across Google and Google Workspace apps.
Microsoft cuts jobs to restructure and invest in key areas
Google isn't the only company restructuring its workforce to make room for AI: Its AI rival, Microsoft, has also blamed the new technology for job cuts.
Microsoft Chief Executive Satya Nadella said in a memo last year that consumers are also optimizing their digital spending, but new technologies are forcing the company to take a position as well.
“First, we saw customers accelerate their digital spending during the pandemic, and now we see them optimizing their digital spend to do more with less. At the same time, advances in AI are enabling the next great wave of computing, and we are transforming the world's most advanced model into a new computing platform,” Nadella said, adding that the company will continue to hire in “key strategic areas.”
IBM, Salesforce and other companies cut jobs
In May 2023, IBM CEO Arvind Krishna predicted that AI and automation would replace 30% of HR and non-customer-facing jobs within five years. The company laid off employees in March 2024.
Discord CEO Jason Citron said in a January memo that the company's employee headcount has grown fivefold since 2020, which could be related to the recent layoffs.
Like Zuckerberg, Salesforce CEO Marc Benioff also blamed overhiring during the pandemic for job cuts in 2023. He said that while revenue had increased, the economic downturn made the cuts necessary.
In announcing the company's 2023 job cuts, Dropbox CEO Drew Houston said the next phase will require different skill sets, with a focus on AI and early-stage product development.
