Layoffs are Happening Not Just in India, But Across the Globe 209 tech startups worldwide have announced layoffs since the beginning of 2022, says a crowdsourced database of tech layoffs
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Two decades or even one decade ago, when a person got fired from work, it meant the end of her or his professional journey. However, today, layoffs are no longer a taboo. Companies, or at least many of them, are open to hiring employees who were asked to leave in their previous stint.
This is because today the person who is asked to leave need not be a bad performer. In most cases, it is because the company is trying to reduce costs due to factors such as a funding round not coming through or an overall economic slowdown, like the one we are facing today. But, having said that, to be asked to leave can be horrifying. It is the biggest fear every employee has. And, it is just not just Indian employees who are having sleepless nights today. Layoffs are happening across the globe. Since the beginning of this year, 209 tech companies worldwide have laid off around 35,000 workers, according to Layoffs.fyi, a platform that tracks layoffs in the tech industry.
Recently, cryptocurrency exchange Coinbase laid off 18 per cent of its global workforce, which is about 1,100 people, including 8 per cent of its total staff strength in India.
"Today, I shared that I've made the difficult decision to reduce the size of our team at Coinbase by about 18 per cent. The broader market downturn means that we need to be more mindful of costs as we head into a potential recession. We also grew quite quickly over the past two years, and have begun to operate less efficiently at our new size. It will take us some time to adjust to this new scale before growing again," said Coinbase Global CEO Brian Armstrong, in a tweet.
Coinbase's announcement of letting go of people came a day after BlockFi, a platform for trading and lending cryptocurrency, announced it was laying off about 200 people. The US-based company which had grown nearly sixfold in 2021, said in a blog post that it was laying off 20 percent of its 850 employees. "Like many others in Tech, we've been impacted by the dramatic shift in macroeconomic conditions, which have had a negative impact on our growth rate. As a result, our number one goal has been to achieve profitability so that we can extend our runway and control our destiny," its CEO Zac Prince said in a tweet.
But, it's not just the crypto companies that are affected by the slump. Privacy and marketing company OneTrust, identity-verification platform ID.me, transportation company Bird and PolicyGenius are some of the companies that gave pink slips to their employees. According to a report, last month, job cut announcements in tech were 10 times the number in the first four months of the year.
The scenario today is being compared to the dot-com or the Y2K bubble when the NASDAQ composite index was pushed to more than 5000 points. This led to the formation of a dot com bubble. In 2000, it dropped continuously, falling 78 per cent from March to early October 2002.
Coming back to 2022, the NASDAQ, which grew by 112 per cent, in the last five years, is down by almost 30 per cent."A lot of companies probably will disappear," Credit Suisse chairman Axel Lehmann said at a an event last month. However, even though it is being called a dot-com bubble 2.0, experts also say that the tech companies today have evolved and have strong fundamentals, which will bring things back on track.