The beginning of 2023 brought troubling news for tech professionals as major tech companies announced layoffs. However, this does not mean the end of their careers in tech. Instead, it's an opportunity to explore new options and gain new experiences.
Numerous layoffs have been reported worldwide, affecting 28,096 tech professionals, according to Layoffs Tracker. This represents a 64.5% increase from the 17,074 layoffs reported in December.
In this blog, you'll find tips for dealing with job loss and important information about layoffs in the tech industry. Understanding the impact and reasons for layoffs is critical before embarking on new career paths.
What Do You Merely Understand By Layoffs?
Layoffs, which can also be referred to as downsizing or restructuring, are when a company permanently reduces its workforce. This is usually done to address financial issues, change business strategy or introduce automation. Unlike the dismissal of a single employee, layoffs involve terminating a group of employees.
Technology companies are currently experiencing an increase in layoffs for various reasons.
It is essential to understand that layoffs and terminations are different. While layoffs are about eliminating jobs due to organizational changes, an employee is usually terminated for poor performance or violations of company policies.
What causes employers lay off employees?
Companies can lay off workers for various reasons, with financial difficulties being the most common reason. When a company struggles financially, it may need to cut expenses to keep operations going, leading to layoffs. Other causes may include corporate strategy and environmental changes, such as the dissolution of functions and departments to align with corporate goals.
The COVID-19 pandemic has also played a critical role in layoffs, as companies hired many employees during the quarantine period in 2020 and are reducing their workforces now that life is returning to normal. In addition, the war between Russia and Ukraine has also led to a significant deterioration in the economic situation worldwide, resulting in layoffs.
Other factors that can lead to layoffs include slow economic growth, recessions, exchange rate fluctuations, and changes in trade policy. In such situations, companies may have to cut costs to adapt to the new economic reality, leading to layoffs.
How to handle being laid off:
While the magnitude of the layoffs is concerning, we must consider the lasting impact. Those affected will likely find new employment or pursue other career paths, but the psychological impact of a layoff, which unfortunately can be multiple, could linger.
In addition to worrying about your well-being, learning new, in-demand skills are essential to get back on your feet. If your previous job is no longer available, this is an opportunity to learn an in-demand skill and position yourself for success. During this time, it's crucial to adapt and be resourceful.