Infographic | As Twitter, Meta cut jobs, a look at layoffs by major tech companies in 2022

"Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13 per cent and let more than 11,000 of our talented employees go", Meta co-founder Mark Zuckerberg, said in a message to the workers.

This marks one of the largest employee layoffs by a major tech company in 2022. Previously, Elon Musk made waves when he decided to let around 3,700 Twitter employees go after acquiring the social media company.

Here's a look at the major tech companies with the most employee layoffs this year.

Among the companies listed here, Better - the online mortgage platform - laid off 5,000 employees. The company made waves when its Indian-American CEO Vishal Garg fired 900 employees over a Zoom call back in December 2021. Peloton, the US exercise and fitness equipment company, had the next most layoffs - letting go of 4,084 employees. CEO Barry McCarthy had written in an internal memo that the move was for the "redemption" of the company and its "successful turnaround", as per The Verge.

Other major names like Microsoft have also reduced their workforce. Axios reported that the company had let go of nearly 1,000 workers and in a statement to the publication, Microsoft said "Like all companies, we evaluate our business priorities on a regular basis and make structural adjustments accordingly. We will continue to invest in our business and hire in key growth areas in the year ahead". Bloomberg reported that Intel is also planning on letting thousands go.

Amazon and Apple have not yet fired their existing employees but the former has frozen corporate hiring in the retail business for the rest of the year, The New York Times reported, while the latter has stopped hiring for many departments outside research and development, as per a Bloomberg report.

Why the layoffs

The pandemic boom that boosted tech companies and their valuations has turned into a bust this year in the face of decades-high inflation and rapidly rising interest rates.

While each company has its set of reasons to lay off workers, the common thread has been to ensure continuity in troubled markets.

Meta, like other social media companies, enjoyed a financial boost during the pandemic lockdown era because more people stayed home and scrolled on their phones and computers.

But as the lockdowns ended and people started going outside again, revenue growth began to falter.

An economic slowdown and a grim outlook for online advertising — by far Meta's biggest revenue source — have contributed to Meta's woes.

"At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that," Zuckerberg told his employees.

Better told its employees that the "mortgage environment" was declining, prompting the change. Intel, which saw a revival in PC sales during Covid had to backtrack as numbers fell. The pandemic has also impacted Apple, which has already forecast a decline in production with its factories in China facing problems due to the government's gruelling lockdowns.

This is perhaps not the last of the layoffs. Lawrence Summers, former US treasury secretary and president of Harvard University, told Bloomberg that the US jobless rate would have to rise above 5 per cent for an extended period of time to curb runaway inflation. He predicted, "We need two years of 7.5 per cent unemployment or five years of 6 per cent unemployment or one year of 10 per cent unemployment".

Even Netflix, the world's dominant streaming service, felt the pressure of inflation and the need for cost-cutting and was forced to lay off 480 employees.

(with agency inputs)