Theories abound that Silicon Valley executives got together to slash jobs. Or that a cabal of hedge funds conspired and forced them to do it.
While I have literally no insight into these companies, I think the reason is “the market” of capitalism. These companies are very similar in how they operate and how they are structured. And they are all “public” companies, meaning that their share price is one of the most important measures of success.
As the cost of doing business rises due to inflation, the share price is under threat. And because it used to be good for the share price to stockpile new employees – even for the simple reason of keeping that talent out of the hands of your competitors – it is no longer seen as appropriate. So companies are doing what they need to do to stabilise the share price and avoid bad press.
One company in particular that has not announced layoffs is Apple, where Tim Cook took a 40% pay cut. He didn’t do it out of the goodness of his heart either, but because his “ballooning compensation” was becoming a problem with shareholders. I am sure Apple will try not to do what all its competitors are doing, because it has often worked to their advantage, and Cook’s pay cut can act as a shield against some bad press. Sometimes you gotta zig when everybody else is zagging.
What it shows is that employees, especially in large, monopolistic companies, are used as pawns to keep investors happy. Tenure and success don’t matter if you can be made redundant to make the figures look good.
You don’t need people conspiring to do this, you just need a system that rewards this behaviour.