Hiring Freezes, Job Cuts Plaguing Big Tech Companies Amid 'Uncertain Global Economic Outlook'

Big tech companies in the U.S. continue to enact hiring freezes and layoffs amid uncertain economic conditions as several are making major staffing changes this week.

Specifically, tech companies Alphabet, Microsoft, and Meta all announced this week that they would either lay off existing workers or slow down hiring. A leaked memo from Meta showed that the company would evaluate worker performance to determine who should remain at the company.

"If a direct report is coasting or is a low performer, they are not who we need; they are failing this company. As a manager, you cannot allow someone to be net neutral or negative for Meta," Facebook head of engineering Maher Saba, wrote to managers, according to The Information.

Meta did not comment on the leaked memo, but CEO Mark Zuckerburg made a similar warning to employees in June. Now, according to the Washington Post, many Meta employees fear mass layoffs are coming. CNBC also reported that Meta will drop 350 workers in July by cancelling a contract with AMB Industries.

Microsoft also announced job cuts for the start of its 2023 fiscal year, which amounts to around 1% of its 181,000-person workforce. The company called the move "strategic realignment," but the company said in a statement to CNBC that it would "continue to invest in certain areas and grow headcount in the year ahead."

Twitter, Netflix, and Gamestop also recently announced layoffs, while other companies seek to slow down hiring rather than firing current employees. A memo obtained by The Verge from Alphabet CEO Sundar Pichai indicated that the company would slow down hiring for the forseable future, for the rest of 2022 and into 2023.

In his memo, Pichai cited an "uncertain global economic outlook" as reasons to "deepen" the company's focus and "invest fo the long term." Pinchai wrote. "We’ll be slowing the pace of hiring for the rest of the year, while still supporting our most important opportunities," added Pichai, noting that hiring would still take place in "engineering, technical and other critical roles."

"Moving forward, we need to be more entrepreneurial, working with greater urgency, sharper focus, and more hunger than we’ve shown on sunnier days . . . Making the company more efficient is up to all of us," Pichai added. "Scarcity breeds clarity . . . It’s what drives focus and creativity that ultimately leads to better products that help people all over the world."

Big tech companies including Uber, Spotify, and Snap also recently announced hiring freezes or slowdowns. However, it is not just big tech that is feeling the effects of recessionary fears.

According to Layoffs.fyi, which tracks layoffs in the tech industry, around the world 333 startups laid off a total of 51,789 employees so far in 2022.