Big Tech Companies Face Trying Times Amid Wave of Layoffs

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A wave of layoffs at tech giants like Facebook parent Meta, Amazon and Twitter — along with falling share prices — seems to signal a changed environment for big tech.

According to Layoffs.fyi, this month alone some 35,000 tech workers have lost their jobs, adding to the more than 100,000 layoffs that have already hit the tech sector this year.

Ben Zhao, professor of computer science at the University of Chicago, says the tech industry layoffs are a “natural part of the economic cycle” after a period of frenzied hiring. He says Meta’s announcement earlier this month that it was laying off 11,000 people – 13% of the workforce – was a signal to other tech companies to downsize after a period of “euphoric” hiring.

“I think in some sense it’s a pause,” says Ben Jones, an economist and professor of entrepreneurship and strategy at Northwestern University. “These companies are not going out of business necessarily; they’re just having to shore up their finances. I think it’s a kind of downshift returning to a lower level of growth.”

Pharmaceutical giant Eli Lilly’s share price recently took a hit after a parody account tweeted that insulin was now free. “Twitter is almost unique in its influence,” says Zhao. “It has surpassed traditional news media as the primary form of information for many, and so for it to be entirely controlled for all intents and purposes by a single person seems to beg for regulatory action. It would be akin to having an entire large TV network that was the primary source for millions to be owned by a single person with no oversight.

Problematic too, says Zhao, is a Silicon Valley culture that puts too much faith and control into the hands of archetypal “genius founders” such as Mark Zuckerberg at Meta.

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