Despite low unemployment in the IT industry, as well as high employer demand for all kinds of technical skills, dozens of IT companies around the world have announced layoffs in recent weeks. Others have announced a slowdown in hiring rates until at least the end of 2022. In the question of what is happening, they tried to figure it out in the edition of Protocol.
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Founders and investors are bracing for what already looks like an economic downturn and possibly a recession. Last week, Y Combinator sent out an email to its portfolio founders warning them to “prepare for the worst.” The Startup Accelerator has warned that the downturn is likely to hit:
companies with a large number of assets;
low margin companies;
hardtech and other industries and companies with high loss rates and long time to profit.
However, early-stage startups are not the only ones feeling the effects of the downturn. Major tech companies including Meta, Salesforce, Twitter and Netflix have also recently announced hiring freezes or layoffs amid cost cuts and rising inflation coupled with an impending bear market and higher interest rates.
The founders of the IT industry (Microsoft), social media companies (Snap) and cryptocurrencies (Coinbase) did not announce layoffs, but slowed down recruitment after poor quarterly results.
IT companies that have slowed down or frozen hiring
While major companies haven’t had to make drastic cuts, some have slowed or froze hiring, citing disappointing earnings and a faltering tech sector in general. Many of these hiring slowdowns, for example at Microsoft, are for specific departments, not the entire company. Here are some companies that have slowed down or frozen hiring.