Google Alphabet also delays hiring... Intensified US corporate layoffs 'cold wind'

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] The wave of layoffs is intensifying among U.S. technology companies. They have begun downsizing in preparation for an economic recession.

Sundar Pichai, CEO of Alphabet, Google's parent company, announced in an email to employees on the 12th (local time) that hiring will be postponed this year. CEO Pichai also hinted at organizational restructuring, stating, "We will integrate overlapping investments and streamline processes."

Microsoft (MS) also confirmed on the same day that it conducted a small-scale layoff. The scale of layoffs is estimated to be about 1% of the total workforce, approximately 1,800 employees. On the same day, GoPuff, a U.S. instant delivery market company, announced to investors that it plans to lay off 1,500 employees, about 10% of its total staff. GoPuff explained the reason for the layoffs as "preparing for a more severe macroeconomic downturn than what we are currently experiencing."

This wave of layoffs is particularly prominent among technology companies amid rising recession warnings in the U.S. economy. This is seen as a "completely opposite signal" compared to the solid employment indicators that had persisted despite repeated recession concerns, spreading market worries as the Q2 earnings season approaches.

Meta Platforms, Facebook's parent company, reportedly instructed management to identify and lay off underperforming employees recently. Prior to this, Twitter laid off 30% of its HR department staff. Electric vehicle companies Tesla and Rivian have also begun layoffs. Uber and Lyft have halted hiring in some departments. The Wall Street Journal (WSJ) reported, "Inflation, supply chain disruptions, labor shortages, and interest rate hikes have combined to bring a chill even to Big Tech companies that had been experiencing rapid growth."

Contrasting with the flood of layoff news, U.S. employment indicators remain strong. However, WSJ pointed out that even in employment reports, signs of slowing growth have been confirmed in some sectors such as computers and electronics. Discussions about layoffs on the networking platform of the company review site Glassdoor have more than doubled since April.