In the tech world, big companies like Google, Amazon, Meta (formerly Facebook), Microsoft, and Apple have been making headlines for laying off workers, even as they see their sales and profits soar. It might seem confusing at first glance, but there are a couple of reasons behind this trend.
Firstly, during the COVID-19 pandemic, these tech giants went on a hiring spree to keep up with the surge in demand for their products and services. But now, as the pandemic wanes, they find themselves with more employees than they need. So, they’re cutting jobs to match their current needs.
Secondly, these companies are investing in artificial intelligence (AI). Instead of hiring lots of people, they are pouring billions of dollars into developing AI technology, which they believe will be worth a lot in the future. It means they are spending less on human employees and more on technology.
Mark Zuckerberg, the CEO of Meta, recently said that his company had to lay off workers to focus on long-term goals related to AI. He believes that having fewer employees makes the company run more efficiently.
Meta, Amazon, Microsoft, Google, and Apple cut around 112,000 jobs from their highest numbers in 2021 and 2022. But even with these job cuts, they were still way larger and made more money than they did before the pandemic started.
Between 2019 and 2023, these tech giants collectively added over 900,000 jobs. But as the pandemic-driven demand started to stabilize, they began cutting back. Even with these layoffs, they are still much bigger and more profitable than they were before the pandemic.
Despite the job cuts at these big companies, the broader tech industry is still growing. In fact, in January alone, the tech sector added 18,000 jobs, according to CompTIA, a technology research organization.
One of the main reasons for the job cuts is the shift towards AI technology. Companies like Microsoft, Google, Amazon, and Meta are racing to hire engineers who can develop AI systems. Even Apple is getting in on this by hiring AI engineers as they work on their own AI technology set to come out later this year.
