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- Tech became obsessed with efficiency in 2023 with about 260,000 workers laid off across the year.
- That obsession has continued into the new year with Big Tech firms announcing further cuts.
Big Tech was obsessed with efficiency in 2023.
Industry leaders used the phrase to justify the culling of hundreds of thousands of tech workers throughout the year as they scrambled to reverse some of their pandemic-era hiring in the face of a drastic economic downturn.
Mark Zuckerberg went as far as describing 2023 as Meta’s “Year of Efficiency.“
That obsession doesn’t look like it’s going to change anytime soon.
After laying off more than 262,000 employees in 2023, tech leaders have continued into the new year with an array of further cuts.
Google parent Alphabet is reportedly laying off hundreds of employees from the likes of its Google Assistant and hardware teams. The company, which laid off 12,000 people in January 2023, cited “changes to become more efficient” in a statement.
Amazon is also cutting hundreds of jobs, with several divisions being slashed in size. Amazon-owned streaming site Twitch is eliminating 500 roles, or 35% of its workforce, Bloomberg first reported.
In a statement to staff, Twitch CEO Dan Clancy said that despite efforts to cut costs last year, “it had become clear that the “organization is still meaningfully larger than it needs to be.”
Amazon’s Audible division is laying off 5%, while the Prime Video and MGM Studios teams face a similar purge.
Discord CEO Jason Citron also announced a 17% layoff of staff in an internal memo on Thursday. Citron lamented the way his company had become “less efficient” in how it operated, per a note sent to employees.
It’s worth saying these layoffs are no means drastic, however.
Data from online tracker Layoffs.fyi suggests that 35 tech companies have laid off 5,586 employees in 2024. That’s a fraction of the 278 companies that laid off almost 90,000 employees in January 2023, per the tracker.
The layoffs are also a small fraction of the overall employee totals for huge tech giants such as Amazon and Google. Amazon’s most recent figures show it has 1.5 million full-time and part-time employees; Google has just over 182,000 staff.
That said, the layoffs are a sign that companies are ready to get even more methodical in getting rid of excess.
When last year’s layoffs got underway, identifying that excess was fairly straightforward, according to some in Silicon Valley.
Venture capitalist Keith Rabois, for instance, suggested that Big Tech firms had become way too bloated in recent years hiring people into roles that lacked direction. It left them pretending to look busy, rather than actually being busy, his argument went. He called it “fake work.”
“What do these people actually do? They go to meetings,” Rabois said during an event hosted banking firm Evercore.
At the time, he predicted that the industry would drop its obsessive focus on growth, and shift attention to other measures of performance, such as revenue-per-employee.
With more layoffs taking place, this seems to be playing out across Silicon Valley and beyond. Tech companies are showing that they want to get more out of fewer employees.
Discord’s CEO Citron noted that his company had increased in size five times since 2020 in a note to employees, leading it to take on “more projects” and become “less efficient,” per The Verge.
“We are increasingly clear on the need to sharpen our focus and improve the way we work together to bring more agility to our organization,” he said. “This is what largely drove the decision to reduce the size of our workforce.”
If tech firms find they do become more productive with this new season of efficiency, they’ll feel vindicated.