The Internet era, which has witnessed rapid growth for decades and soaring stock prices, is coming to an end. Instead, it is an era of layoffs and slowing recruitment, sharply lowered growth expectations, and shelved expansion plans. From Seattle to Silicon Valley to Austin, a grim new reality is emerging in the entire technology field - an Internet era with decades of rapid growth and soaring stock prices is coming to an end.
Instead, it is an era of layoffs and slowing recruitment, sharply lowered growth expectations, and shelved expansion plans. This malaise is damaging employee morale, affecting the ability of the technology industry to attract talent, and has a broad impact on U.S. economic growth and innovation.
Against the background of long-term economic slowdown, fierce conflicts in Europe, rising interest rates and inflation, and the global epidemic entering its third year, a grim new business environment has emerged every day.
Technology companies cut spending
On May 23, snap, a social media application, lowered its sales and profit forecast and said it would slow down recruitment. The next day, online car Hailing company LYFT said it would cut jobs and seek other cost cutting measures. Subsequently, Microsoft stopped recruiting in several key departments. Instacart, a goods distribution company, said it would cancel the recruitment plan before the IPO to reduce costs.
Tesla CEO musk said in an email sent to Tesla executives on Thursday that the company needs to "cut about 10% of its staff". Coinbase, a cryptocurrency exchange, said it would extend the recruitment freeze according to market conditions and cancel some accepted job offers.
Amazon's business is being affected by the rapidly rising cost of inflation. Meta, Facebook's parent company, is cutting spending. Twitter froze hiring and withdrew some job offers before musk planned to buy twitter. Apple In April this year, the company warned that the revenue of this quarter would decrease by as much as 8billion dollars.
The setback of corporate ambition marks a change in the atmosphere of an industry that once seemed impregnable and provided protection for workers and investors in the greater economic turmoil.
Fear of "downsizing" envelops Silicon Valley
When talking about the technology industry, Tom forte, technical analyst of Da Davidson, said:
"They are no longer a sure bet. Investors are uncertain because there are a lot of things against them."
Since hitting a record high on November 19, the Nasdaq composite index has fallen by a quarter.
Layoffs have begun to plague workers in Silicon Valley. According to the data of recruitment exchange app blind, from April 19 to May 19, the discussion on freezing recruitment increased by 13 times compared with a year ago, the discussion on layoffs increased by five times, and the discussion on economic recession increased by 50 times.
According to layoff, more than 126000 technicians have lost their jobs since the outbreak began. Netflix said last month that it would cut about 150 jobs after it reported an unexpected loss of users. Since mid November, the share price of the streaming media giant has fallen by 71%.
Meta slowed down the recruitment of many middle and senior positions in the company, and reduced the recruitment of engineers with limited experience in April. In May, groundless speculation that meta was preparing for a round of layoffs spread on social media, leading to the creation of the metalayoff theme tag, which began to become popular in LinkedIn. Dozens of recruiters and employers began to use the tag to provide alternative job vacancies.
Twitter employees are preparing for potential layoffs as the company awaits the arrival of its new boss, musk. Musk once said that he would cut costs. CEO Parag Agrawal sent a note to more than 7500 employees of twitter in early May, explaining that social networks will start from reducing travel, marketing and activity costs, and telling leaders to "strictly manage your budget and give priority to the most important things".
Similarly, Dara khosrowshahi, CEO of Uber, said in a memo to employees that the company "regards recruitment as a privilege and will carefully consider when and where to increase the number of employees".
The technology industry is far from dead
The invincible aura of the technology industry may be fading, but Silicon Valley is far from dead.
At the beginning of the 21st century, the Internet foam once strangled the technology industry in its cradle. During the 2008 financial crisis, the technology industry was still in its infancy. The difference this time is that the science and technology industry has matured, and the epidemic has also strengthened the importance and necessity of many science and technology products, providing them with some buffers to cope with the economic damage caused by the suspension of the epidemic at the beginning.
"Everyone finds that technology is not only good, but also indispensable," said Russell Hancock, CEO of a nonprofit organization that studies Silicon Valley and its economy He added that what is happening now seems to be a market adjustment, which is a new thing for Silicon Valley. However, he is also worried that as products such as streaming media services and social networks become more and more practical, some highlights and innovations in the technology industry are disappearing.