Thanks to the rollercoaster of crypto, the conflict in Ukraine, and tremendous inflation on a global scale, many tech companies have been shedding employees left and right. Until the end of January, PayPal had been able to avoid making such decisions, but on the 31st, CEO Dan Schulman explained that in the coming weeks, 7% of his workforce would be gone from the company.
While 7% doesn’t sound like much overall, for them this represents over 2,000 employees. As Schulman emphasized the company is now firmly entrenched in a “challenging macro-economic environment,” and despite trimming costs at a significant rate, they still had “more work to do.” Unlike many other employers, Schulman resolved to ensure their now former employees were taken care of with a sizeable severance package as well as support as they transitioned.
“We will treat our departing colleagues with the utmost respect and empathy, provide them with generous packages, engage in consultation where required and support them with their transitions. I want to express my personal appreciation for the meaningful contributions they have made to PayPal.”
Major layoffs like these have been blanketing the tech space for months now. Meta, IBM, Microsoft, Alphabet, Spotify, and Salesforce among many others have all cut significant roles in their companies. Given the COVID remote workers, many of these companies hired, the downsizing as many companies return to in-office work or transition away from all virtual support is making a huge difference.
As advertising revenue fell this last year, many speculated that these mass layoffs were just around the corner. With fears of a global shutdown, panic-driven inflation, and interest rate hikes coming compliments of the Federal Reserve, the business landscape for these tech companies had shifted dramatically. While the shift was anticipated, it happened in different ways and intensities than many experts had projected.
This shift has also resulted in the news of termination coming in far more impersonal manners than ever before.
Instead of getting the dreaded call down to the boss’s office, to see HR, or even a simple Skype meeting. they aren’t even being told they are terminated. Instead, they are waking up to find out their email access has been revoked. Others are driving in for work, only to discover that their badge won’t let them into the office. This impersonal notification is not only leaving many feeling betrayed, but it is also poisoning the potential recruit pool. As word spreads, many are suddenly avoiding those companies.
One of the most shocking stories comes from a woman who was on maternity leave from Google and suddenly learned she had been cut while feeding her daughter. A bold decision like this from them could also land them in federal court as this could be seen as a case of discrimination.
For those here in the US on a work visa, it becomes a drastic scramble to find a new employer, and they need it yesterday. Much like the woman on maternity leave, they are on a very tight timetable to get new work secured, or they’ll be forced to find themselves a flight back to their home country. Given the costs of visa sponsorship and the hoops it necessitates, many employers aren’t willing to put in the effort.
While the words of Schulman and other CEOs mean little to those being fired, they are taking firm responsibility for the terminations. Their recognition of the impact previous actions and aggressive business decisions took on their employees is not something often seen in big business. Instead, that gesture is usually reserved for the mom & pop businesses in small-town America. Perhaps it’s that gesture that will keep people applying in droves.
