What the Latest Tech Job Cuts Indicate

Whatever job security existed in tech appears to have disappeared. On Monday, LinkedIn said it was cutting 668 people, the third round of layoffs at the Microsoft-owned unit this year. Meanwhile, developer forum Stack Overflow said Monday it would cut its staff by 28%—which, according to the Verge, amounts to 100 jobs. And that’s just today: late last week, Flexport cut 20% of its staff, or 660 people, following a similar reduction in January, while word that Qualcomm plans to cut 1,258 jobs in California leaked out of regulatory filings. 

This isn’t exactly a replay of last year’s flood of layoffs. For one thing, the overall volume of job cuts isn’t as great, judging from data on the layoffs.fyi tracking site. Moreover, the causes of the cuts seem a bit different. Last year’s cuts were more a response to macroeconomic conditions,  as big tech firms cut in response to a downturn in ads and corporate spending on enterprise software, while startups had to cut costs when venture funding dried up. Today’s cuts seem to be caused by a narrower set of factors more specific to individual sectors. Qualcomm has been hurt by a slump in the mobile phone market, where it is a dominant supplier of chips. Stack Overflow CEO Prashanth Chandrasekar blamed macroeconomic pressures, but it may also be a sign that the firm has been hurt by increased use of generative AI. (Earlier this year, we identified the firm as one of several companies vulnerable to the impact of ChatGPT.) Flexport, meanwhile, is pulling back after an over-ambitious expansion and a sharp drop in shipping rates.