CEO of Meta, Mark Zuckerberg, has attributed the recent wave of layoffs in the technology industry to tech companies needing to create a “leaner” workforce following the period of rapid expansion that was seen during the COVID-19 pandemic.
The tech industry has seen mass workforce reductions in 2024, with Layoffs.fyi projecting that 159 tech companies have laid off 41,793 employees so far. While this number is a far cry from the over 260,000 tech layoffs in 2023, many tech workers are concerned about losing their jobs to new technology like artificial intelligence (AI). However, many tech leaders, Zukerberg included, have dismissed AI as the reason for the layoffs.
In a recent interview with the Morning Brew Daily podcast, Zuckerberg highlighted how many organisations initially increased their hiring efforts during the onset of the pandemic, fuelled by the surge in ecommerce activities during lockdown. However, after the lockdowns were lifted, companies found themselves grappling with uncertainty regarding the sustainability of this growth. This led to mass layoffs to streamline operations and ensure financial stability.
Meta, formerly known as Facebook, underwent significant workforce reductions between November 2022 and May 2023, with thousands of staff being let go across four separate rounds of layoffs. The company cited economic uncertainty as a primary factor driving these decisions.
While AI’s role in workforce reductions has sparked debates, Zuckerberg explained that, for Meta, AI was not a primary driver behind the layoffs. Instead, the focus was on optimising the company’s structure to deliver better outcomes with a leaner workforce.
AI fears may not be completely unfounded
Despite Zuckerberg’s words and the assurances from other tech executives about AI playing a limited role in the layoffs, it doesn’t seem to be so for every tech company. In January, German software firm, SAP SE announced plans to restructure roles for 8,000 jobs to focus on AI-driven business areas.
Other tech giants like IBM and BT have also automated certain roles, forcing them to let go of the employees who used to tackle those roles.
By Derrick Kafui Deti – Digital Economy Magazine
