Layoffs 2023: Experts predict continuation of 58 per cent higher layoffs in 2023 compared to 2022
PTC News Desk: Throughout 2022, global economic uncertainties and the aftermath of pandemic-induced overhiring set the stage for a wave of layoffs across tech companies. However, 2023 followed suit, continuing this trend with a staggering 58 per cent increase in layoffs compared to the previous year.
In this dynamic landscape, experts observed a fascinating interplay between domestic tailwinds and global headwinds, creating an intricate environment for HR departments and job seekers alike. The job market unfolded as a blend of challenges and opportunities, influenced by both local and international factors.
Data sourced from layoffs.fyi revealed a significant surge in layoffs. In 2023, a total of 1,175 tech companies bid farewell to 260,509 employees, marking a stark contrast to the 164,969 employees affected by layoffs across 1,064 tech companies in 2022. The statistics painted a vivid picture—a staggering 57.8 per cent increase in job displacements in the span of a year.
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On a global scale, major tech giants were at the forefront of these substantial job cuts. Amazon led the pack, letting go of over 17,000 professionals, closely followed by Google (12,000), Meta (10,000), and Microsoft (10,000). Within India's tech landscape, the layoffs were equally significant. Byju's took the lead by laying off 3,500 employees across two rounds, followed by Unacademy, which saw 12 per cent of its total workforce being affected. ShareChat, Swiggy, Ola, and Physics Walla followed suit with 500, 380, 200, and 120 layoffs respectively.
As the year progressed, attrition rates hovered between 17 per cent and 22 per cent, highlighting the ongoing challenges and changes within the job market landscape. The year 2023 underscored the evolving nature of employment dynamics, as companies navigated through various internal and external factors influencing their workforce decisions.
Munira Loliwala's Perspective
Munira Loliwala, the assistant vice-president overseeing strategy and growth at TeamLease Digital, provided insights into the current job market dynamics. She highlighted that despite the prevailing wave of layoffs, reductions at the bottom of the employment pyramid in most sectors remained relatively modest, ranging from 2% to 3%. This minor reduction contrasts with the overall intake of talent.
Loliwala emphasised India's challenge in meeting global expectations, citing the need to foster green software developments, expand cloud networks, and enhance customer interface solutions/services. These demands have impacted project execution timelines, often resulting in scheduled layoffs towards the end of calendar or fiscal years.
Jaideep Kewalramani's Observations
Jaideep Kewalramani, the COO and head of employability at TeamLease Edtech, delved into the dynamic nature of the 2023 job market. He noted that while domestic tailwinds experienced a slight slowdown, global headwinds continued to influence the landscape. This confluence created an engaging environment for HR professionals and job seekers alike.
Kewalramani observed a significant paradigm shift with strong signals advocating a return to physical office spaces from tech giants. He highlighted how this stance led to polarized debates surrounding work hours per week, signifying a crucial shift in workplace culture.
He further elaborated on the discussions within boardrooms, focusing on the intricate balance between growth, office return policies, employability, skill development, and talent retention. These conversations have shaped organizational strategies in approaching both hiring and firing decisions.
However, Kewalramani cautioned that despite the diminishing impact of the COVID-19 pandemic, the emergence of the latest strain, JN.1, might trigger moments of pause and contemplation within the industry.
According to Munira Loliwala, the trend of job losses and layoffs is expected to persist amidst the evolving climate until 2026. However, she anticipates that replacement hires will predominantly focus on entry-level and mid-level positions within Global Capability Centers (GCCs), data centers, and tech centers across industries like Banking, Financial Services, and Insurance (BFSI), automotive, and Engineering Research and Development (ER&D).
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