Google, Microsoft, Amazon, and other major technology companies have announced record layoffs as they begin the 2023 work year. Google announced a plan to lay off 12,000 employees from its workforce while Microsoft said they would be laying off 10,000 employees. Amazon also began cutting its workforce and is expected to lay off more than 18,000 employees, marking the largest workforce reduction in the retailer’s 28-year history.

These layoffs are coming at a time of high interest rates, an effort on the part of the federal reserve to battle inflation amidst fears of a recession in the coming year. 

During the pandemic, tech companies like Amazon and Google went on a massive hiring spree, but are now reversing their course and starting to lay off massive amounts of employees. Due to the reduction in the workforce, there have been at least 154,000 layoffs from more than 1,000 tech companies in the last year, according to Layoffs.fyi.

Tech companies have reduced hiring this year with job openings within tech companies dropping nearly 30% and new hires within the industry down 23% according to iCIMS, a talent acquisition company.

During the lockdown, consumers increased their activities on e-commerce sites such as Amazon and spent long periods online interacting on platforms such as Google and Microsoft, as a result of real-world experiences being off the table due to global restrictions. This increased activity led tech companies to expand their workforce to handle the concurrently increasing workload. Once advancements were made in the treatment of COVID-19, global restrictions were raised throughout many countries, resulting in consumers going back to their normal daily routines and causing tech companies to have a vast workforce, now causing a drain on resources.

To compensate for this loss in profit from decreasing global activity, tech companies around the world laid off large portions of their workforce, only keeping positions that were vital to their success.

The layoffs received massive backlash from employees and consumers around the world. During a time of massive inflation, employees felt it a betrayal and inconsideration to fire them while the prices of products and living expenses were so high.

In the future, tech companies may experience layoffs again depending on the global economy and interests in their sites and products, however, it’s not certain what may happen with employees of these massive tech companies.