The tech industry is currently experiencing a wave of layoffs mirroring the job cuts instituted at the peak of the pandemic. BanklessTimes has presented data showing that 61,769 layoffs have taken place in the tech sector today. This mirrors the 60,122 job cuts that were instituted in Q2 2020.
Experts say that the industry is still feeling the effects of the pandemic, which disrupted supply chains and made it difficult to do business.
When asked to comment on the development, Jonathan Merry, CEO BanklessTimes said, “The technology sector is still feeling the impact of the pandemic.
“The scourge disrupted global supply chains leaving companies to deal with a significant drop in demand. Many of them are still struggling to rebound from its after effects. Their recovery has been slower than many had hoped and this has led to more layoffs in recent months.”
Other Factors Explaining these Layoffs
One major factor driving these layoffs is a slowdown in venture capital funding. The risk aversion of many Venture Capitalists has grown following the pandemic. This is evident in the drop in large funding rounds. Additionally, there’s been a decrease in M&A activity, and many tech companies are struggling to monetize their products and services in the face of growing competition.
Some believe that the industry is simply restructuring in light of changing technologies and consumer habits. Others believe that the layoffs could be due to a cooling of the economy, which has led to less spending on technology products and services.
Finally, the prevailing unfavorable economic conditions which are characterized by biting inflation have had a toll on the tech firms’ operations.
The job cuts have significantly impacted the workforce, with many people losing their jobs or having their hours reduced. The workers who have been laid off are facing an uncertain future as they struggle to find new employment in a tight labor market.
Some Crypto players are defying the trend
The crypto sector has recently seen a spate of layoffs, with some of the most prominent players in the field announcing massive cuts. Coinbase, for instance, announced that it would be letting go of 18% of its staff in mid-June which affected 1,180 employees. BlockFi also declared 20% of its staff (250 employees) redundant.
Celcius and Gemini also announced layoffs in that period. The former let go of 25% of its workforce, rendering 150 staff jobless. Meanwhile, the latter laid off around 10% of its team, resulting in redundancies of 100 positions.
In spite of this, it is not all doom and gloom in the crypto world. Despite the downturn in the tech sector, certain crypto firms are looking to expand their business hence headcounts. Binance, for instance, has announced 2000 job openings across different fields in its firm.
Another exchange that is expanding its staff is Kraken. The American exchange has 500 openings it would like to fill in the coming months. Similarly, Revolut seeks to expand its staff by 20% over the next five years.
This indicates that there is still strong interest in cryptocurrencies and that the industry is headed in the right direction. While there may be some turbulence along the way, the long-term outlook for cryptocurrencies remains positive.
Layoffs could be positive
The impact of these layoffs is likely to be felt throughout the economy, as workers spend less money and businesses suffer from a lack of demand. While there are certainly some negative consequences associated with them (e.g., workers losing their jobs and reduced spending in the local economy), there are also some positive outcomes.
For example, this wave of layoffs is forcing companies to be more efficient and productive, and it is also encouraging workers to be more selective about their job choices. In addition, it provides an opportunity for new companies to enter the market and for older companies to reinvent themselves.
Ultimately, while these layoffs are certainly unfortunate, they may end up being beneficial for both the tech industry and the economy as a whole.
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