The pink slips continue to flow in the tech sector. Spotify is laying off 600 employees while PayPal laws off 2,000.
The steady stream of the pink slips is continuing to flow out of the tech sector. We last brought up the massive amount of pain earlier this month when Microsoft laid off 10,000 people. That massive wave of layoffs followed a string of other high profile massive rounds of layoffs. The most commonly cited reason for the layoffs is the anticipated recession. As a result, advertisers have backed off of paying for advertising which has really become a huge part of revenue generation in the sector.
So, for some, the question was when the next shoe was going to drop. Apparently, it didn’t take long for that to happen. Last week, Spotify wound up laying off 600 employees which accounts for 6% of it’s overall workforce. From DailyHive:
Audio streaming platform Spotify has announced that it is laying off 6% of its workforce, days after several major tech companies also announced layoffs.
On Monday morning, Spotify CEO Daniel Ek shared a note with employees about the company’s organizational changes. It was later published on Spotify’s website.
“As we say in our Band Manifesto, change is the only constant. For this reason, I continue to reiterate that speed is the most defensible strategy a business can have,” Ek began.
“But speed alone is not enough. We must also operate with efficiency. It’s these two things together that will fuel our long-term success. With this in mind, I have some important news to share today.”
The news? Some reshuffling in the executive department and a bunch of layoffs.
Indeed, Spotify is far from the first major tech company to make such an announcement lately and recent news proved that they were not going to be the last. PayPal recently made an announcement that they are going to lay off 2,000 of its employees. From CNBC:
PayPal on Tuesday announced plans to lay off 2,000 employees, or around 7% of its workforce, according to a release posted to the company’s website.
President and CEO Dan Schulman wrote in the release that PayPal is working to address the “challenging macroeconomic environment.” He said the company has made progress focusing resources on core priorities and rightsizing its cost structure, but that there is more work to be done.
“Change can be difficult – particularly when it includes valued colleagues and friends departing,” Schulman wrote about the layoffs. “We will face this head-on together, drawing on the unparalleled scale of our global platform, the strategic investments we have made to strengthen our core capabilities, and the trust and loyalty of our customers.”
One question this all raises is where are these employees going to go. Just because a layoff happen doesn’t mean that the individual just disappears into the ether. They are going to need somewhere to go after this. In all likelihood, some will probably end up in different sectors. Others might just reinvent themselves and get into a completely different industry entirely. A few might even decide to start their own business, relying on what they learned inside these companies. Indeed, there are probably options out there for employees like that, but it doesn’t erase what a number of people are likely going through right now. We’re talking about feeling like the whole world being turned upside down and some might even be feeling desperate.
Another question is when will the pink slip flow finally dry up and things stabilize. The hope is obviously that this will slow down sooner rather than later, but at the same time, we are already a couple of months in and these stories just continue to pop up.
Drew Wilson on Twitter: @icecube85 and Facebook.
