Tech companies cut jobs to chase growth, but watch out for those shareholder returns

Publicly listed technology companies under pressure to make deep job cuts can underestimate the often negative impacts redundancies may cause, both financially and culturally, as well as the harm to shareholder returns. According to data tracking service Layoffs.fyi, some 675 technology businesses have so far waved bye-bye to …

[Ace2]

Oh, so you mean you could plan ahead a bit and hire carefully, and then not chuck boatloads overboard at the first sign of trouble?!? Who has ever heard of such a thing.

[Anonymous Coward]

Annoyingly, I'm getting tons of emails from Meta "recruiters" trying to fill contract positions where they want to pay half of their usual salary and only guarantee you a job for 12 months.

[Version 1.0]

"And how they beat us, And how they worked us so hard, And how they used us, Till they refuse us (Do you remember the days of slavery?)" - let's create a new band to describe today, Burning Spear App.

[uccsoundman]

"None of this is conducive to long-term shareholder gains. "

That's the trouble. NOBODY is interested in "Long Term". Shareholders are only interested in the next quarter's results. In the long term they have long since cashed out to go milk some other cash cow.

[Anonymous Coward]

totally this, the MBA axe-wielders ride into town to gut the tech departments, make a quick win on the EBITDA, trouser the annual bonus and ride off into the sunset before the pipeline dries up and the business tanks. Rinse and repeat.

[Doctor Syntax]

I take it the pressure will come from activist shareholders who are waiting for the knee-jerk increase in share prices to take a quick profit.

[Electric Panda]

How many of these being purged are technical or engineering roles? In my experience it seems that TA, marketing etc. are getting the chop to ostensibly save money, meanwhile they hire 150 engineers in bandwagon disciplines "to support our ambitious future plans" and all that guff. These new engineers are on bonkers pay.

[Anonymous Coward]

Gartner assumes financial people have actual brains. They don't: Anything beyond profit in this quarter is beyond their capabilities. And they are paid literally to do *just* that.

"we have to save x dollars per year, so we lose y people." That's the most they ever can do.

Who is doing the work of said y people? Achh, the rest of the people, naturally.

At that point all the smart people leave the company so only financial people and clueless management is left. Sales drop so it's time to axe more people and cycle to 'company for sale' is ready. Management and financial people of course get paid royally when company is finally sold, only the peons suffer, so why would they worry about anything?

[Anonymous Coward]

I think what is actually happening is best summed up by Voltaire: "pour encourager les autres"

This would be a commendable course of action, if they had read the whole quote:

"il est bon de tuer de temps en temps un amiral pour encourager les autres" —

"It is wise to kill an admiral from time to time to encourage the others".

[Bebu]

Voltaire

"It is wise to kill an admiral from time to time to encourage the others".

I hadn't realized this quote from Voltaire's Candide referred to Byng.

I suspect most large tech companies would benefit from a decent Bynging of their upper management and boardroom who are currently sacrificing their gallowglasses on the opposing cannon.