Real talk here, and I'm sorry for being "that guy"
Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping? I know multiple people who have worked their entire career thus far without ever staying at a place for more than 3 or 4 years. Some no more than two. Tech job culture is practically a mono culture with "hop jobs" being a hallmark.
From an employers perspective it's not laying off a bunch of family members (Southwest has an average tenure of 11.5 years), it's laying off a bunch of people who were gonna dip in 6 months to a year anyway.
I know this is controversial take, but recognize that the tech industry is an outlier industry, with outlier amounts of money and outlier amounts of volatility.
I cannot speak for layoffs in all industries ever, but I agree with your assessment of layoffs in big tech from personal experiences.
I have way too many “lifer” friends in big tech who are deadly scared of layoffs and job hopping. They are also the ones who rarely got promoted and havent had a significant pay bump pretty much ever.
On another hand, half my team at a big tech company got laid off back at the start of 2023. 4 months later, I caught up with them over drinks, and the results were rather interesting. They all got around 4-6mo worth of severance pay, spent 2-3 months just skiing/traveling/hiking/vacationing, then 1 month or so interviewing, and then starting their new jobs shortly after. All seemed rather happy, both with their new positions/pay (which had a significant paybump) and, essentially, paid vacation break they took right before.
It seems like the heavity majority of those stressed about layoffs in big tech are lifers and those who are chronically averse to and dread the interview process.
Yeah, I make the same adjusted for inflation that I did when I got my last/only promotion 10 years ago. I have grey hair, a disability, and a family that relies on the health insurance. Switching or being laid off is a risky proposition for me. It sounds like all your examples are young, childless people (who else could take a month off to go vacationing?). Life is much harder for some of us.
Yeah, the prospect of layoffs hits a little different when you're in your 50s. I have some non-techie friends in their 50s (sales, project management) who have been looking for a job for years. I've even heard third-hand about some good programmers in their 50s in the same boat, although I don't know them personally.
The last time I was looking for a job at age 48, I interviewed at a bunch of startups and only got a second interview from one. It was clear that most of them were never going with someone my age unless I'd written a book or had patents or something (or was ex-FAANG), even if they didn't consciously realize that.
Yep. The subliminal message I'm getting from my current managers is that I should just be a good little disabled person and work as a Walmart greeter. It's turning into harassment at this point. Just all sorts of BS. Like telling me they are doing so much for me, when my ADA accommodation is weekly 1-on-1s with the manager and my tech lead. Is that really a lot? There are people without disabilities getting weekly 1-on-1s with their managers. Maybe the weekly tech lead meeting is more than others get, but it doesn't seem that hard. I got told my productivity looked bad. I asked if he ran the numbers - he didn't. He didn't even look at my productivity before telling me it looked bad. I ran the numbers and I was in line with my peers. I would think that's the definition of bias... nobody gives a fuck. I didn't get my accommodation for 6 months last year and then they gave me a bad rating based on opinon and not metrics. They said me not getting the accommodations wasn't a factor in my performance (how?).
No sympathy from me either; instead, he gets appreciation. Thank you, OP, for bringing more life into the world. It's hard and (obviously) frequently thankless.
Thanks, but I'm not sure this deserves appreciation either. We already have plenty of life in this world. Perhaps so much so that the human life is negatively impacting other life, including other humans. I'd be much more appreciative of people making life better than making more of it.
The new generations of drones, still being tested, are fantastic at hunting down anything with a pulse. It is a really exciting time to be in robotics and CV. I am no longer concerned about overpopulation.
That's a pretty weird and heartless thing to say. Having children is not a vice that deserves to be judged anymore than not having kids is. I could enumerate why fewer kids is bad for our collective future as a whole, but I won't, because the decision to have kids is a personal choice.
Also, having kids is generally not the difference between having to work or not—most people have to work for a living regardless of family status. It's just that the stakes are higher when you have dependents.
You can view what I wrote whatever way you want, but I stand by it and don't think it was heartless at all. I think not having children is actually more heartful and caring than having children.
Look, out of all the people who come into this world, how many people can we say were a net positive for this planet? I see that you are currently at Airbnb. Great. You are lining your pockets, but I'm not sure what the net benefit to this planet is. If I have children, the chances are great that they were just resource consumers and waste producers. There are too many people on this planet, and chances are my having kids will make this problem worse. Of course, on a local scale, your children will add love to your life, you will help them out financially, they will live at home with their parents as adults, etc. This is not being selfless. You are helping your progeny which is, ultimately, selfish. What is truly selfless is to meaningfully help someone who has no connection to you. Fight for the poor, support countries that are being terrorized by aggressor countries, adopt a shelter animal, etc. That is truly selfless. Having kids--selfish. Look at Elon Musk and his 10+ kids.
> the decision to have kids is a personal choice.
And I choose not to burden the world with my own children. I've had numerous exchange students, adopted shelter animals, and I'm volunteering at a local shelter. I'm not under any illusion that my life here is going to be a net positive for the planet, but I am trying really hard. Having children, with the traditional notions about it that you regurgitated, is a vice when you consider that we are reaching our planet's capacity for supporting all of us. Ruining other planets such as Mars, I don't feel is a morally acceptable choice.
So you don't think people should have kids, that's a fair viewpoint, I don't begrudge you that.
But you responded to a thread where someone was expressing the considerations they have about why being laid off is personally scary to them. Using that to grind your axe about whichever of their life choices you find morally dubious is the heartless part.
It's not really surprising though since your first reaction to my comment was to look at my profile and cherry-pick something to condemn me with.
I didn't ask for your sympathy. I'm merely responding to someone who doesn't understand that others have factors that affect how hard it is to change jobs.
On a side note, I'm getting whiplash by how fast we go from
It's your fault for having children [overpop, resource exhaustion]
to
It's your fault for not having children [low-birthrates]
back to
It's your fault for having children [whatever this is]
I think a lot of the "low-birthrate" fearmongering is just a way to distract people.
Overpopulation was projected to be an issue, but we actually addressed it pretty well over the last 50-75 years and global average birth rates are in a pretty good place now.
Haha you must be young. It's entirely possible young people will make the same choices and face the same realities I currently do. They just havent gotten to that stage yet. Even comparing my life now to my life 10 years ago would show the younger me had an easier life. However, having a disability is not a choice, and in general makes life harder than those without a disability. Don't get me wrong - I believe life is hard for almost everyone at at least one point or another in unique ways and to varying degrees.
Actually, I am not young. I just retired and have been thinking about my life, career, etc. I do not have a disability (my wife may disagree) and I agree it makes life more challenging (wouldn’t be called a disability otherwise). I also agree with you that life can be hard, children are born with health challenges, children make poor decisions with terrible consequences, spouse dies, you get cancer, etc. We all need to get through these. That does not change the fact that we all have decisions to make everyday about our careers, our families, our health, our financial situation, and so on. When we look at those who made different decisions, it does not necessarily mean they made better or worse decisions, just different decisions.
I have been thinking about this a lot recently. A former boss and good friend who is incredibly smart and effective in the work place asked why the two of us had never gone the PE route and been more successful. While he is very successful by most standards, he sees people flying private jets all the time who do not appear more skillful, yet have been more successful. As I think on this, I feel I simply was never willing to go all in on the risk required to achieve that level of financial success. I tried co-founding a company once when I was 28 while engaged and importantly, before children. I felt I could take the risk and if I failed, could bounce back. I did fail - company did ok but my I ended up disliking working with my senior partner - and I did bounce back, ending up at GE.
After that, I did not feel comfortable taking that level of risk until my children were off to college and no longer dependent on me an I had enough money saved that my wife and I would be ok for a long time. The people I know who have been jet-money financially successful took huge risks. They were all in on their venture(s). Frequently this cost them their marriage and/or relationships with the children. This was their choice. Their cost/benefit analysis to optimize their success criteria. Some regret the decisions - they underestimated the effort and impact on those they cared about. However, most have not. They are happy with how things have turned out.
The other factor you are missing in your analysis of PE route is the number of musical chairs are limited. There can only be 1 taylor swift not millions. So the choice is not for everyone. Even if everyone made that choice, a million taylor swifts will not happen. Surviorship bias is real.
Dealing with poverty in my youth, homeless at 16, no parents to help me, debilitating ADHD, tourettic OCD, bipolar type II, CPTSD from 10 years of intense childhood physical/emotional abuse, my full-ride college scholarships illegally stolen from me by a high school who knew I was homeless and had no recourse and allowed a teacher to illegally modify my grades out of pure spite, malnourished, intense, crippling sciatica, fused lumbar discs, possible fibromyalgia, and then developing excruciating daily pains and physical disability which greatly impacted my life and sometimes made me suicidal, which turned out to be an autoimmune disorder that took 10 years for doctors to figure out... an extremely intense case of gout developing since my teens...
I just keep pushing on but every day I see people who take so much for granted, and who are so ready to pass judgement without appreciating the basic privilege of good health.
I've had to deal with so much struggle that the average person wouldn't even want to take the time to hear all of it much less believe it, once someone momentarily realizes that they'd have it comparatively easy compared to others, they often get defensive as they begin to realize that their life doesn't have nearly as many barriers as they've convinced themselves, and they have to come to terms with not applying themselves harder. It's easier for them to be dismissive and tell me, "all your problems would go away if you worked out more" or tell me to get on a keto diet, or whatever have you, as if I haven't tried every single thing I can think of.
And the insane thing is I am still quite privileged compared to some people in war-torn countries, even if they are able to move around without swallowing a truckload of ibuprofen. Reminding myself of that is a source of strength and determination to keep moving forward.
Well, the person you originally replied to mentioned having a disability, and your response was "yeah but you have kids so really you chose this and also I disagree that life is harder for some people."
The generous interpretation would be that you have sufficiently good health that you do not have to structure your life around it, and therefore lack understanding of the challenges faced by those who do.
The alternate interpretation, that you do understand and choose to ignore and dismiss, would be rather less generous to you.
Not passing any judgements on any life choices here, but occasional months off sounds like a good thing. I would not necessarily need to go anywhere to enjoy (make use of) the time. The notion of getting a month off with pay sounds good.
That sounds good, so long as there is similar employment at the end of it. As a sabbatical it sounds great. As a layoff, the uncertainty sounds crushing. It could take months to find a new position, especially with the disadvantages I have, I would likely need to start looking immediately and wouldn't be able to enjoy it.
Yeah, it's the same problem I have when the 20 somethings use the term "funemployment".
If you're single and have no responsibilities, sure. The second you have a mortgage, medical conditions that need health insurance, or need money because you had a family emergency and had to dip into savings, it's not "funemployment" at all.
Sure, maybe that's how people in their 30s living in NYC or bay area feel about layoffs. But when you're older, have a family, and live in an area with a less dynamic job market, you may see things differently.
Why does it have to be an age thing? Some men and women are players and the game is the game to them. Those who are naturally monogamous would be stressed in a game like that. Constantly uprooting is a stressful lifestyle and can truly be torture (as evidenced by constant anxiety, no way to be). I can promise you people who are job hopping are hopping around other things in life (friends, family, relationships, projects, interests, roles, identities). It's a whole way of being.
Edit: This is not a judgement, but if you felt like it was, I very much want to hear about it.
> Why does it have to be an age thing? Some men and women are players and the game is the game to them.
Yes, buuut many will be players from 25 to 35 (with some degree of flexibility), that's why it's still an age thing. Yes, there are persons that are players for life, sure. But IME they are a minority.
Big tech interviews tend to be daunting. Many long term employees lose the skill, and fear the impact of work interruption on their resume as well as their ability to get in again.
Anecdotally, the LC bar for many firms has risen to the point that passing requires at least one through of the question before. If you Time bound your practice per question to 20 minutes, this means that you can solve most LC problems at least once in around 8 weeks of 40 hour weeks. Or 6 weeks at 60 hours.
Not a pleasant way to spend two months - but not impractical. I'm unclear what employers are deriving from this exercise at this point.
> I'm unclear what employers are deriving from this exercise at this point
It filters out the complete frauds.
Yes, there are people who know all the right things to say in a job interview, but cannot code at all. If you hire one of them, it takes a bit to find out they cannot code, and a bit longer to fire them, so you're out $$$$ paying their salaries for nothing.
For example, a recruiter I know will ask a tech candidate "what is 20% of 20,000?" A significant percentage cannot answer the question. Some even cry. It's shocking.
A friend of mine was looking at getting a FAANG job. He was worried about the leetcode tests. I suggested he spend a month going through the leetcode books studying them - that the return on his time investment doing that will be one of the best ROIs he's ever done. He did, and got the job. (Although the LC was just a first gate one had to go through to get to the real job interview.)
Personally, I have no idea how I'd do on an LC test without prep. But I don't have a problem with studying it to get a top job.
> it takes a bit to find out they cannot code, and a bit longer to fire them, so you're out $$$$ paying their salaries for nothing
Not just that. They block the hiring process. Maybe there was just that one open position on your team, and that bad 3 month hire postponed a good hire by 6 months. It's also very incomfortable to fire and start again.
My interviews contain questions that are basic, and any new team mate should know. I keep asking them because 90% of the candidates actually can't answer them well. You should know what a "dot product" is if you want to work as a ML engineer, that kind of stuff. Or be able to open a text file and count word frequencies.
True words. It's not 'imposter syndrome' if one comes across as an imposter (though it might have been just be a bad day).
I can appreciate the gating process because it's a real drag to get hired and then spend more time than necessary not doing my work but trying to help coworkers catch up on very basic and fundamental skills in order to be able to collaborate with them.
> For example, a recruiter I know will ask a tech candidate "what is 20% of 20,000?" A significant percentage cannot answer the question. Some even cry. It's shocking.
During our interview, we ask candidates to design a history system. The key is to realize that our database is only 8Gb, and storing a year of updates is only 160Gb, so $2pm in AWS. Once there, a simple DB table suits, no need to set up Amazon S3.
So we ask them for the multiplication. First we give them the data, and if they don’t do the calculation, we nudge them, then we ask them, then we write the multipliers for them, then we take the calculator out and write the result for them.
Those are Masters degrees. They can’t even do calculations, let alone getting it right, because 500MB x 200 days a year = a few petabytes apparently. And after that, they’re exhausted, it’s impossible to ask them the rest of the questions like “So is it worth worrying about a Rube Goldberg machine when you’re in for $2 of AWS costs?”.
I get that perhaps you were using the proverbial "I" in your last sentence as an example of something everyone should be willing to do in/for their career, but does someone of your stature even need a real interview, much less a LC test, to obtain a top job? It's kind of funny imagining a young tech bro interviewing you, tbh.
I generally do not use clever algorithms in my code. I just use straightforward ones. Rarely, I might need a better one and go looking for it (like a better hash algorithm). I rarely use a data structure more complicated than an array, list, binary tree, hash, or single inheritance.
What I have, though, is decades of experience with what works and what doesn't work. (My favorite whipping boy is macros. Macros look like they are great productivity boosters. It takes about 10 years to realize that macros are a never-ending source of confusion, they just confuse and obfuscate every code base that uses them. I could go on about this! ...)
I have become pretty good at writing modules that minimize dependencies, and pretty good at the user interface design of a language.
But still, if the job wanted a leetcode test, I'd take it, no problem. I'd study up first, though.
If a young tech bro was interviewing me, I'd suggest he show me his best code, and I'd do a review of it :-) The point of that would not be to humilate him, but to demonstrate the value I can bring to improving code quality.
If I was being interviewed for a job writing a faster divide routine (the ones I wrote were shift-subtract, slower but bulletproof), a better random number generator, a cryptographically secure hash function, a tighter compression algorithm, a faster sort, I'm not the right guy for that.
P.S. I was once asked to review the code of a famous programmer I won't name. I was shocked to discover that the large codebase had 3 different implementations of bubblesort in it. I replaced them all with a call to qsort(). He asked me how I managed to speed it up :-/
My favorite blind spot is how our definitions of quality change over time. I knew someone who had a mature codebase which a new developer made substantially faster by removing his old optimizations. He’d measured very real improvements back when he made that hand-rolled assembly code on early Pentium generations but by the time we revisited it less than a decade later the combination of compiler and processor improvements meant that the C reference implementation was always faster. (I was assisting with the port to PowerPC and at first we thought that it was just XLC being especially good there, but then we tested it on x86 with GCC and found the same result)
Beyond the obvious lesson about experience and sunk costs it was also a great lesson about how much time you assume you have for maintenance: when he’d first written that code as a grad student he’d been obsessed with performance since that was a bottleneck for getting his papers out but as his career progressed he spent time on other things, and since it wasn’t broken he hadn’t really revisited it because he “knew” where it was slow. Over time the computer costs eventually outweighed that original savings.
I have done probably 500 to 1000 tech screens for big tech companies (as the interviewer) and this is completely true.
I have interviewed many people employed in tech as programmers for their entire career and they can't code. I don't meen leetcode, I mean they get confused trying to write brute force substring search. The nested for loop seems to be too complex for them to keep in their head all at once.
I have had numerous people cry. Again this was a screen, not leetcode. I'm asking them to check if text has mismatched parens, or find a substring. Things you do for homework in your 2nd programming class freshman year. Things every competent programmer can do while chitchatting about the job.
I would estimate that more than 10% of screens are like this, again these are employed people in the industry for years, sometimes tens of years.
Edit: I understand that people can get flustered, I understand that some people have trouble under pressure or while being observed. That's why I pointed out multiple times that the problems I gave are extremely, EXTREMELY easy. I'm basically asking them to write down their name and they sit and look at the pen like they've never seen one before. If you can't write a 5 line function to find whether a substring occurs in a larger string when given 45 minutes, your choice of programming language, and as many attempts as you need to debug and try again you simply will not be able to do any useful work as a programmer. If you don't know that to match parens you need to use a stack (or at least that it's one way to do it) you either have a very poor memory or no training in computer science at all - either of which is frankly disqualifying. Anyone borderline competent would invent a stack when presented with this problem if they hadn't already been told this fact a dozen times during their education or even light reading about algorithms.
> I have interviewed many people employed in tech as programmers for their entire career and they can't code.
Think about this contradictory statement for a while. Can it actually be true? Or is there something else going on?
If the interviewee has nothing but sub-1yr stints on their resume, perpetually getting fired before vesting at any company, then yes, it's very possible they actually can't code and just fake it at every interview.
But everyone else... if they have spent years at tech companies writing production code then obviously they know how to code. They might be great or maybe mediocre, but guaranteed they at least know how to code.
So, if your interviewing technique is concluding something that is obviously impossible, then start by considering how to improve the interview technique.
I’m an electrical engineer who does circuit design. I’ve interviewed many electrical engineers over the years and the situation of applicants having “years” of experience while simultaneously not knowing how to design a single circuit is real. In our field it’s usually because although the person’s title is engineer, in practice, they don’t do any engineering. There’s just a ton of peripheral work (basically paperwork related to operations and compliance), which is very important, but is not design.
My guess is computer science has a similar issue.
Lots of people with programming in thier job title but they don’t actually program. And based on ltbarcly3’s empirical measurement, “lots” is above 10%. ;)
I know a lot of people who can tweak code that already exists. However, if they are sitting in front of an empty text editor and given a goal, they don’t know how to break the problem down and build a solution with the tools the language gives them.
In a large environment, someone may rarely need to start from nothing, so the interview format throws them.
That said, I think being able to break down a problem to solve it with code is a really important skill. Without it, the person will always have to lean on others to fill that skill gap.
> I know a lot of people who can tweak code that already exists. However, if they are sitting in front of an empty text editor and given a goal, they don’t know how to break the problem down and build a solution with the tools the language gives them.
But being able to break things down and come up with a solution is not necessarily something that needs to be done quickly, in the time you have for an interview. Quite often I've been faced with a new problem and done absolutely nothing visible for ages. Literally just reading around the problem, asking questions, and sketching in my mind without writing a single line of code.
This is often faster and better than starting immediately.
There's another extreme, too: people who can code up an app in a matter of days, but can never learn to navigate and successfully maintain a legacy code base (even their own!).
And there's no easy objective way to screen for this in a job interview. So they pretend it doesn't exist and never ask questions like: "Suppose you're designing a green-field app that you think will grow over time like X, Y, and Z. How would you design and organize your code so that the app stays maintainable and flexible over time?"
I could talk for hours on this subject with concrete examples if anyone ever asked.
I think another problem is that there are so few engineers/architects who really "get it" on this subject. I can only think of a few ex-coworkers with whom I could have the kind of in-depth conversation about app design and organization that I'm picturing.
I've never worked in big tech, always for startups or non-tech corps with a few rock star devs and a lot of decent devs. So maybe it's different at a FAANG. But in my head I'm picturing a bunch of algo-geniuses whose code turns into a big mess over time when requirements take a right-turn and break all their beautiful abstractions. I've worked on a few apps like that and it's not fun.
The goal when hiring isn't to find someone who is barely skilled enough to just slightly come out as better to have on staff than not. In fact these are often the worst hires as they slow everything down and create work for you to find tasks they are capable of, but it seems unfair to fire them because they aren't totally useless all the time. You hire the best candidate overall, and you are very far from describing that.
I always try to give everyone I’ve interviewed the benefit of the doubt. You never know what’s going on in their lives, and even if they fail a trivial question it doesn’t mean they are faking the ability to code.
I joined Facebook back in 2018. Didn’t study at all for the interview and passed somehow. Then I probably conducted 200-300 interviews in my time there, so I became quite familiar with the questions. My performance ratings were all exceeds or greatly exceeds. I voluntarily left on my own after four years to join a unicorn startup. I didn’t prep for that interview either but passed it too. Well, the startup failed and many people went back to Meta. So I actually prepared quite a bit this time and scheduled a mock interview with them. The mock interviewer said I did great and not to change a thing. When it came time for the real screening interview... I failed the matching parentheses question.
I generally try not to make excuses. Almost every interview I’ve failed has clearly been my own fault. But in this particular one the interviewer kept interrupting me every two seconds and I absolutely could not think. I had done matching parentheses many times before in practice, but the constant interrupting rattled me to the point where I totally lost focus and bombed it. Not a great experience.
So yeah, I’d just recommend giving people the benefit of the doubt. Everyone has difficult moments occasionally, but it doesn’t mean they’re stupid or can’t code.
I run coding interviews at BIGCO. Half of the candidate success relies on the skills of the interviewer. A bad interviewer can bomb the best candidates.
Something I have changed my stance on a bit is automated coding interviews. I used to be adamantly against a company giving candidates automated code tests, but I see now that it takes the interviewer out of the equation.
Pre-screening, depending on how it’s done, could eliminate good candidates.
There have been times I’ve received answers in interview that weren’t the written answers, but I looked it up afterward and tested it out… and they were right. I learned something news and tweaked the answer reference as a result. If those questions were in the pre-screening instead of asked directly by me, it would have filtered out good people.
I remember fighting to get access to the pre-screen data to see what the answers were and find if there were any other cases like this, where the non-technical pre-screener was filtering out potentially good candidates, because we couldn’t give them exhaustive answers to questions being asked.
As an interviewer at Google, we arent given an exact list of questions to ask or what to evaluate (there are broad categories).
It is really entirely up to each interviewer how the interview goes and they are usually scheduled between 2 other meetings so often the interviewer is distracted.
What is really crazy about this though is that sometimes it really is the interview setting, as people unused to interviews can, at times, emotionally collapse. I have seen people who are actually good programmers get wrecked by simple questions because of their inability to handle stress, and how the lack of interview practice turns a simple exercise into a hellscape.
It's not as if testing for performance under stress is useless: Tough on call rotations happen, and you might need someone that does well under pressure at 3 am in the morning. But the picture you get on a screening isn't as clear as it appears.
Not to imply that you're wrong, but I've always been bad at LC interviews, but surprisingly (for myself) passable when called upon to troubleshoot and code up a hot fix in the middle of the night. Maybe those are not entirely similar types of pressures.
You are still not testing if they can code. But whether under the scrutiny of another person, they can code. Maybe this is important to you, maybe peer programming is important to you for example. I remember a young dev who couldn’t pass such tests, as he would get too nervous, yet he had written the core tech for many shipped products. The type of guy you would just stick in dark room. With age this type of stuff settles down.
“Scrutiny of another” who’s a peer or even a client is super different from an interview.
The latter has more in common with an open mic night, the prospect of which the vast majority of people are terrified and would break down if they attempted it.
I agree with both you and the parent to some degree. I have experienced interviews that went badly because they were in an IDE I wasn't familiar with, or in Leetcode (never used it). So I'm distracted by how to use the tool rather than how to code the solution. But I can also see how stuff like finding a substring is easy - most languages have a function for it. But at that point, you're testing different things - problem-solving vs rote memorization of a provided function.
I feel like a good middle is to allow Google for documentation searches, not solution searches. Without searching (or IDE with radix completion), I'd probably fail the test for not knowing the syntax off the top of my head.
As someone who does these types of interviews on both ends, something like this is why I like to start with an outrageously simple question to break the ice.
Surprisingly, I have an 80% fail rate on the first question usually, which is just “find the second largest number in an array of numbers” for a 5 YOE role.
The other replies to this comment aren't wrong but I feel they fail to take into account that (especially with startups): having someone watch you code during an interview is one of the the least stressful experiences the person will face with the company - once the job begins. Companies can't take on the risk of dealing with a bunch of passive-aggressive bullcrap once the real code reviews begin after the hire. Most tech job reqs contain the words "Excellent written and verbal communication skills" on purpose.
Imagine a person with a pilot's license refusing to fly tandem for an airline interview.
> Imagine a person with a pilot's license refusing to fly tandem for an airline interview.
That’s not a great comparison since a pilot has already passed substantially harder tests to get that license and a flight is exactly what the job is. If you have a candidate with a pilot’s license you can assume at least a baseline level of capability which you can’t assume for a software engineer. That has pros and cons but it definitely means interviewing is a noisier process.
The other problem, however, is deeper: the job of flying a plane is exactly what’s tested to get a pilot’s license but what many places do for developer interviews is wildly unlike the actual job so it’s more like interviewing pilots based on trivia questions about the number of rivets on a B-52 and how well they can solve 3-D puzzles, and then being surprised when there isn’t much correlation with real world performance. For example, only at the most toxic companies will the interview be one of the least stressful parts because the rest of the job is a team effort. What makes the interview challenges stressful is doing it without your normal tools while someone else is looking for reasons to fail you, but in a normal job your coworkers are trying to help you succeed because even if you’re not friends you are all better off when your company succeeds. At a startup, trying to ding someone for trivia challenges is like hitting the iceberg to prove that the navigator made a mistake.
I agree, but I look at it like trying out for an athletic team.
Once you're on the team, you are mostly practicing plays, doing clinics, and simulating competition, but to get on the team in the first place you have to prove your general fitness by running, say, a 6 minute mile.
You may not be able to do that again easily right away once you've been on the team for a while because you don't practice running for pure time at that distance, but it's a level of fitness you should be easily able to obtain again if you had to, and it's a very useful benchmark to a scout.
When you're laid off, it's time to start doing that "roadwork" again. It will be a bit hard at first in practice, but if you've been a solid contributor, you should be able to get fit enough again to prove that.
I definitely feel that first part. I landed in a nice company in SF about 8 years ago and am still here. The culture has changed a lot but I often find myself doubting whether I could repeat the whole thing or if I got lucky. (The work is fine, and the company is one of the good ones I feel, so no real qualms there).
Just do what everyone is doing today and use those AI tools for cheating. There’s a whole industry of invisible and hard to detect leetcode AI cheating tools.
Glad they exist and I fully support all candidates using them aggressively.
This is a persistent myth in our industry. If you're a good manager, you can tell within minutes if someone is "for real", if you can't, you aren't qualified to be hiring people. Have you even looked at their GitHub?
A few months of skiing sounds nice, but not as nice as the profound pleasure of working on a team of people I've know and cared about for over a decade.
You're going to spend half your waking life at work. For me, that's too much time to not want to do so at a place where I have real relationships with my coworkers.
This is ultimately what some of the risk comes down to: you invest time(a decade is a long time!) into creating meaningful relationships at work and one day you come in to have your key card de-activated and some corporate speak as to why. There are certainly people working on truly meaningful projects out there, with teams they trust and adore...but for most of the workforce, even in tech, its just work and any fun had at work is a great cherry on top.
How is this different than the manager who has spent years developing an employee - making sure they are getting the experiences they need to build a better career, hiring the right people to complement the team, fighting for bonuses and pay raises - only to have them quit to join the next company for a 10% raise. It is difficult to build a long-term culture when society seems to expect job hopping to rapidly advance a career.
On a related note, it is odd that HN comments rarely seem to include a manager’s perspective.
I've never seen people leaving great jobs for a 10% raise. It's always something else: a much bigger benefit, or a significant downside of the current job, which are not widely publicized. Instead, I've seen people going to a lower-paying position for a more interesting job, a chance to learn new hot thing hands-on, a different set of responsibilities, etc.
I worked with a guy who left for more money, found out the grass wasn’t greener, and came crawling back. Then did it again. For some reason they hired him back a second time. When he quit the 3rd time I think that was the final bridge burned. I asked him about it and he said money was his singular metric for choosing a job, he was always looking, and would never stop.
An experienced manager would know that is how the game is played and act accordingly. Don't get emotionally attached to any work relationships. It's transactional, keep that in mind.
Wow, I couldn't disagree more. My personal life is what I enjoy, the random people I work with to make money and will be gone as soon as I quit or get laid off, well... I just don't want them to be toxic. I already have a ton of friends, I don't need to convert work people into my social life. Skiing for a few months sounds super amazing though!
Those "lifer" friends may just be later in their career, though. Your ability to significantly advance your compensation depends on how early in your career you are. You will plateau at some point, but early on it makes a lot of sense to job hop. My first job hop was for +66% comp increase. My next was for about +25%, next for +15% or so. Eventually you hit a ceiling. After 30 years in the industry, my last job change was probably about +0.05%. I expect if I have to interview again, it's a toss up whether I'd get a higher or lower offer.
Post layoff, a person on H1B has 2 months to sign a new job offer or they must leave the country.
Majority of Indian and Chinese H1bs do not have green cards, and are the main group that suffers. Some of these folks are well into their 30s, with kids and houses in the US.
I’m familiar with H1b visas. Yes it’s an irritating situation for an immigrant to be in but it’s not as bad as you make it out to be.
If you have good life savings, you can convert to tourist visa, and stay in the country for an additional 6 months and a higher hassle when restarting your career.
You can leave the country, and get back as long as your H1b is still valid.
If your spouse is working, you can be convert to being a dependent on them with H4 visas.
At the end of the day I think the government should not let people end up in such a situation. After the 6 year H1b deadline, I would prefer if the government just sends a notice to those that it thinks can immigrate long term and send the rest back. At least then we won’t have the ridiculous situation of upending families and children who have started schooling just because their parents lost a job.
I stayed in the same job for nearly a decade, it got really interesting in the second half; in a way that it never would have gotten if I had job hopped every 3 to 5 years.
That being said, once I got bored in the job, I sniffed out that the parent company wanted to lay a few people off, and hinted that I was open to it. It worked out well for me.
I was just too busy in my personal life to look for a job on the side, and honestly I didn't want to walk away halfway through a project.
How does this work, though? Every company I've worked for has an HR system, and resumes flow through it, and there's a set process. If I have worked with a candidate in the past and highly recommend them, all I can do is submit their resume into the great void and check a box "Recommend". I don't have any other power. There is no "Skip the interview, I vouch for him!" button that I can push.
It's probably related to the size of the company. Most of the companies I've worked for in the past have been between 50-200 employees across the entire org. The dev teams were usually around a 10-20 people and the director of R&D often encouraged us (the devs) to recommend new hires. They still had to pass through HR but it was more of a formality and the director had the proverbial majority vote.
Smaller teams are also more tight-knit so recommending a new potential dev wasn't a matter of process - it was literally head down a few doors and have a chat with the director.
I'm sure it's significantly different for huge enterprises where even the teams within the R&D department are heavily siloed.
> How does this work, though? Every company I've worked for has an HR system, and resumes flow through it, and there's a set process. If I have worked with a candidate in the past and highly recommend them, all I can do is submit their resume into the great void and check a box "Recommend
I haven't worked for any massive companies with thousands of employees where there might be a lot of bureaucracy, but the few I've worked for ranged from ~100-700 and it was pretty easy to get interviews for referrals. One of my employers encouraged referrals and offered bonuses if it led to a hire.
That's how it works in my company too. The recruitment teams barely work with the engineering teams themselves. You may know a very good fit for the team, possibly even a previous member/intern of that team, and you won't be sure you can put the person into the recruitment loop. And then they'll need to pass the interviews...
And at the end of the day the HR work for your VP. And your VP needs people to do things, and if he hears you are a good person and you are available it will happen. HR is just a layer of process. Make them happy in regards to the things they care about.
This story is changing. There is now an oversaturation of us ex-BigCo people in the market. I quit Google before the layoffs, after being there for 10 years and sick of it. The first year was serious ego boost, having Google on the resume opened doors all over the place. Then my ex-coworkers started getting laid off and things began to shift.
Now I know people I used to work with who have been without work for many months and having a hard time getting interviews.
Granted, I'm not in the Bay Area, so. But the market is saturated.
> The first year was serious ego boost, having Google on the resume opened doors all over the place.
Before I worked in FAANG, My subjective view of big tech SWEs was they were very skilled, in a different league.
My current view is that it "just" takes very good preparation and a decent resume to get in. And they've hired so many people that it's not so special anymore to be an "ex-Google". There are just a lot of them.
That being said, I think someone who gets hired in such a company, and manage to stay for many years has to be quite productive and competent. Especially if they reached higher levels.
Google is not a "produce a lot of code" place. It's a careful and deliberate and systematic type of place.
One thing I think ex-Google does bring especially to the table is a disdane for over-complicated and overly trend-driven solutions.
For one Google's internal review culture is (or at least was when I was there) very stringent. Pointless complexity and showboating is usually spanked.
For two, because Google basically rolls its own everything in regards to frameworks and the like, developers who come out of there have been mainly cured of "flavour of the month" and "my ego wants us to use this new shiny new-coloured tech".
Its not that the market is saturated, its that a lot of incompetent ex googlers are interviewing now. People usually have a pretty good idea they can't do their job. They find a niche where a manager is not paying attention, or they can obfuscate and take credit for others work, etc. These people don't usually job hop, the interviews are way too hard and then they are very unlikely to find another long term safe niche to hide in. So previously seeing google on a resume correlated highly with strong competence. A lot of people laid off from google are complete incompetents. A lot were hard working geniuses too, but it doesn't take many interviews where a exgoogler is completely useless to spoil the brand.
The reputation for googlers on the market right now is very bad, and it will keep getting worse as the group of ex googlers who are basically unemployable keep interviewing over and over and over.
There's also the "we can only pay a third of what Google paid you..." and given two candidates that interview equally well, one is former Google and appeared to be making $300k and another is from somewhere where they were making $70k before...
I'd argue for the $70k person. They are less likely to have experienced lifestyle inflation and looking at this position as a "slumming it until they can get a job making $300k+ again."
It further complicates the issue that most companies don't have Google scale problems and don't have the engineering culture for a Google scale solution.
There are several factors working against even not incompetent former Google employees - especially if their experience is entirely within Big Tech.
A bit ago a former Tesla person was in the set of interviews and it became clear that they wanted to make the organization that was considering hiring them into a copy of how Tesla works... and that wasn't something that was going to be doable. The post interview discussion was "this person is going to try to make us into a copy of Tesla for six months, and then leave shortly after they realize that we weren't a place that could become another Tesla."
Big Tech experience may be a positive signal for getting hired at other Big Tech companies... but it can be a negative signal at a company that isn't trying hiring for an organization that can't become a Big Tech company - especially if that is the only thing that is known.
Hiring isn't necessarily picking the "best" person for the role, but rather the least risky. Former Big Tech employees are often riskier than other candidates given their lifestyle expectations and the mismatch of the engineering cultures.
Personally when I left Google and interviewed elsewhere I made clear to potential employers two major things:
1. I never expected to be paid "Google level" money again. I was nowhere near high up in the pay tier there, but it was still almost twice what local shops were paying, at times (depending on how RSUs worked out, etc.)
Google can pay what it can because of the ads firehose, and it was actually, more than anything, a strategy used to deprive the competition of talent.
2. I never actually liked the Google internal culture, so although I was there for 10 years I was constantly aware of the things that I didn't like and the things I would not be trying to bring over to future gigs. And I had 10+ years work experience before Google. Which didn't serve me well while I was inside Google, but definitely has afterwards.
> It seems like the heavity majority of those stressed about layoffs in big tech are lifers and those who are chronically averse to and dread the interview process.
Not helped by the fact a lot of interview processes - unless you can rely on word-of-mouth and the corporate structure allows for shortcuts - are byzantine, maddening and/or don't have much relations to the work one will be doing afterwards. No fuck you I'm in for a sysop/cloud position, I won't waste my time doing Fizzbuzz. Give me a laptop with internet and an actual work task if you want to judge my competence.
Maybe that perception that people chronically job hop is not true? I would welcome a data source that shows chronic job hopping is the norm.
Anecdotally speaking, I spent 6+ish years at my first "old tech" company. My org in this (very large) company was constantly simmering with resource actions (mostly small scale layoffs). There was lots of negative energy there. I left to take a programming/data analytics gig in a large, privately held financial company that had never had a layoff. This was unfortunately timed, 2 years later the financial crisis of 2008 kicked off and I (and my entire team) were all laid off. I have been with my current employer for approaching two decades and several of my peers have been on our team for that much time.
I have had a SINGLE manager in that time window. I can't even name all the managers I had in my first job due to near-constant re-orgs and layoffs.
Another anecdote from my part. I graduated in roughly 2015. I've had 5 software eng jobs since then. Each one I've had at least 2 different managers in the average 2 years I spent in each. My latest role, however, I was at for 2.5 years and had 6(!) managers. I had originally intended to stay at that role longer term but it was obvious the constant managerial turnover was a negative for my career growth - so I hopped again.
I've not experienced a layoff, but I also think its extremely abnormal to be in a position for so long and only have one manager.
I contracted/consulted around London for decades, and though I was with some clients for many years in total, others were much shorter, and short entries on a CV were not seen as a red flag AFAIK.
(Well, there was one hiring manager idiot who could not conceive of anything other than linear non-concurrent contracts as being honest - that interview did not go well, but I dodged a bullet!)
I think it's possible that the majority of tech workers aren't hoppers, but the majority of applicants are. This just stands to reason, since hoppers aren't doing much applying and interviewing. This would tend to make interviewers think that this is a dominant strategy even if it isn't really.
It's also the case that the "everything is transactional, fuck your coworkers, leave your job the minute you can plausibly say you learned something and move on, chase impact at any cost because you only have one career" live-to-work contingent is just much louder online, especially here. After all, these are people that are investing a lot in their career, while IME most of my coworkers, even managers (though I don't personally know very many VP-and-up managers) are work-to-live people, mostly interested in their families and hobbies, and seem to rarely post on forums like this.
In any case, I'm fairly certain that there are (or were until recently) Labor Department researchers who have figured this all out empirically and could give us an answer if we knew where to look.
> Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping?
When I leave a job, I always give my employer 6 or more weeks notice with the additional offer that they can still reach out to me for help if they need after that for as long as my memory remains helpful. The time I got caught in a layoff I had the door slammed in my face minutes later and two weeks severance contingent on signing away rights. Maybe the workers who complain understand that circumstances are not always equal.
Job hopping is done to maximize your salary in the least amount of time - but everyone knows that there's a ceiling. You can't just keep job hopping for the rest of your career, and magically end up making 25% more every time you hop to the next gig.
Sooner or later you'll start to reach a ceiling, and have to defend your salary more. The idea is that if you can end up hitting that ceiling in 10 years by job hopping, that's better than spending 25 years at one place to hit the same figure. The earlier you have maximized your salary, the more you can invest and hopefully retire earlier.
Now, once you hit that ceiling - it kind of sucks to be in a constant state of job hopping. You actually don't get rewarded, and it is more stress than anything. And the older you get, the more stability you'll value - after all, you probably have a mortgage, kids, and all that to account for.
It's a chicken and egg problem. If people feel they could have a meaningful career in a given place, they would stay longer. When you see your teammates getting laid off one after the other - including people with 5-10 years of seniority and history of good performance, you start to wonder whether you should have any sense of loyalty to the company.
I joined my company with the naive hope there would be some sentiment of family/community and that I'd do a big chunk of my career there. But after seeing how they treat employees, I'm looking for the way out.
- Detail-oriented nerds with a rich mental framework around things like optimization, making decisions based on data, perhaps statistical approaches to uncertainty get frustrated when they see their organization making big, irreversible choices without the benefit of all available information. From the IC or line-manager level there may be a bunch of information which you can tell was not taken into consideration.
- Process-oriented people who have put a bunch of effort into planning, goal-setting and measurement based on seemingly reasonable assumptions like "this team that provides service X will continue to exist for the duration of project Y which depends on X" get frustrated when execs throw everything into disarray ... and then 3 weeks later want to know why Y is off track.
As the article describes, often lay-offs end up being bad for the company, not just the employees who get terminated. Even if you're not let go, or even if you just care about the value of your vested equity, it can be quite frustrating to see this happen. And often, because layoffs are generally planned in secret, leadership explicitly precludes the possibility of getting input from the experts in their organization.
While perhaps some layoffs ultimately turn out ok, I think generally the people who go through them can tick off a list of parts of it that were ill-considered and needlessly disruptive, in part b/c of this lack of trust and communication.
I think there are two reasons: choosing to change jobs on your own gives you ability to pick a time when it's minimally disruptive to yourself and your actual family, and then the pretend "family" vibe you cite is pushed by the employer in the first place. Companies insising on a game of make-believe where the relationship between employer and employee isn't transactional makes it hard not to be bothered by the hypocrisy. I agree that on average, the tech industry isn't as bad as other industries often are, but I don't see why that's a compelling argument not to care about the fact that it still could be better. There's nothing stopping me from wanting fewer tech layoffs and better conditions for workers in other industries as well (and in some circumstances even advocate for that even knowing that it might require changes to my own quality of life to achieve that; as a trivial example, I go out of my way to tip much larger than 20% when I use Uber because I'd rather risk getting ripped off than a driver not getting paid a fair wage for the work they do for me, even if it's at my own expense).
At the end of the day, everything is a balancing act, and the amount of change most of us can make as individuals is a drop in the bucket compared to the unfairness that people have to deal with every day. We all have to make judgement calls on where to take a stand and where to play it safe to avoid making things harder for ourselves without actually making a difference that ends up helping anyone, and if people are acting in good faith when trying to make those choices, I don't see any value in criticizing what they end up deciding. If anything, most of us in tech are probably in far more of a comfortable position to be able to speak out against employers (either or own or those in industries where workers are treated even worse), so I think there's a reasonable argument that it's more important for us to because of that. It's not a zero-sum game though; pointing out tech employer hypocrisy doesn't inherently take anything away from pointing out even worse things that other employers do.
> I go out of my way to tip much larger than 20% when I use Uber because I'd rather risk getting ripped off than a driver not getting paid a fair wage for the work they do for me, even if it's at my own expense
Honest question, as a European who doesn't fully understand tipping culture: don't you think that this might be perpetuating a culture of exploitation? Wouldn't you rather spend your money on taxis that at least have some regulations if you are afraid the drivers are getting the wrong end of the deal?
The thing is, the tech industry is also an outlier in a sense that the quality of the job you find varies massively depending on (1) the timing, sometimes literally by a few weeks and (2) whether you already have a job or not.
And so, layoffs are not "just another bump" in people's career. They represent a major net negative for people who would otherwise have much more control over the trajectory.
I've worked over 12 years at the same company. Finding a new job would be difficult as remote pays lower and isn't the best fit for me, my area isn't known for tech job, my spouse doesn't want to relocate, I work for one of the biggest employers in my area (fewer choices outside the company), and we are seeing the highest sector unemployment since the dot com bubble. Oh, and my disability makes it all worse. My job has been an absolute hell hole for the past 2 years, but internal and external job opportunities have been extremely limited.
I guess there are a broad range of perspectives and how loud people are is going to depend on their perspectives. Some reasons to dislike layoffs:
- visas may be dependent on employment, and can make changing jobs harder. In the United States, lots of visa rules are at the discretion of the government (eg how long one may live in the United States on an employer-sponsored visa while unemployed)
- the recent (and dot-com era) tech layoffs have been cyclical: many companies are in layoff-mode or hiring-spree mode at the same time. The time when many companies are not hiring is the worst time to be thrust into the job market
- people may have other job security worries – big tech companies tend to always be growing so it is worrying if they are laying people off instead of moving them from a failing business line to a new one
- in general some people may have a lot of anxiety about changes to income. If you are applying for new jobs while currently holding another, there is much less pressure than if you’re unemployed and need to find a new job (and possibly at a pay cut requiring outgoings to be reduced) before you run out of savings, especially if you don’t have much in savings compared to outgoings, which may be the case for some tech workers (some people spend a lot, or have much of their wealth tied up in property or have a family which requires spending more on eg housing or school fees). The much-worse consequences of failing to get a new job may increase the pressure/stress/discomfort
- this reveals an obvious truth about where the power lies in ‘engineering-focused’ companies and people don’t like it
- people can see a layoff as being like a firing and therefore be unhappy due to hurt pride (or worries about being less desirable in the job market)
- the lack of agency in a layoff is unpleasant. It is quite different from choosing to apply to other jobs.
The tech industry also doesn’t reward loyalty, even at big tech.
There’s a reason for the low tenure at most firms and it’s primarily due to the lack of rewarding experience and depth of field knowledge at most companies. When you have to get a new job just to get a salary increase that keeps up with inflation you are going to see a lot of job hopping when the skills of the workforce are generally in demand.
How often is it that someone leaves because they can get paid better elsewhere? Why do we think this wouldn’t drive the primary cause of people leaving companies?
Where the fuck is the company showing any loyalty to its workforce?
> Where the fuck is the company showing any loyalty to its workforce?
They have been and are out there. But all it takes is a change on C level and cost cutting suddenly is everything, loyalty a thing of the past. That is, you cannot count on loyalty anymore, even if the company you are working for is currently showing it (or seems to).
Yeah I don't see the big mystery here. People leave to keep up with cost of living or get away from toxic elements in their current workplace that are otherwise difficult - if not impossible - to change by staying. It's not something we want to do, it's something we have to do for one good reason or another. If we had better rights and meaningful raises to improve or even sustain our quality of life, the job hopping would surely decrease. The layoffs and the reason for job hopping are both attributed to actions on the employer's side.
For almost every job I've had, I would have been more than happy to stay there if it provided the career growth that job hopping provides. Companies seem to deliberately make internal promotion far more difficult than just job hopping to L+1.
Big tech employees have been abandoning companies the second they can get higher TC for decades, and as soon as the companies start firing a very small fraction (in a lot of cases people who were coasting or incompetent) its a problem of morality?
You can really see what people are made of when they face adversity. Good luck.
Big tech employees are a fraction of all tech employers and employees. There’s problem so systematically pervasive that you see this across the board. Companies do not value long term retainment of employees up and down the size spectrum and it’s very clear in how they behave.
They don’t award experience and depth of knowledge in any way that is indicative of fostering retention
100% (I have owned and worked at my own company for 10 years)
Anecdotally, I've also worked at many startups that became big companies through acquisition and Let me tell you - J&J has a lot of employees who have been there more than 5 years, thousands. They also had several big layoffs of such people during the process.
Because a lot of tech workers today aren't actually job hopping and instead get very cozy in a job and a team and a career trajectory, which feels unfairly ripped away during layoffs for reasons that don't feel connected to their personal performance.
That's kind of a chicken and egg issue, isn't it? Why is it that employees can get more money/promotions from a company they have no relationship with, than from a company where they've already been working for multiple years and have more company-specific knowledge than their replacement will? Unlike with government work, years at the company isn't really considered when deciding who layoffs are going to hit. You're proposing that tech workers should loyally stay at the same company for 10 years, make less money, and then get laid off just as easily anyway?
Tech is a huge field. If you work in big tech or well-known companies, it is common to job-hop. If you're at something more established, traditional, or mid-sized, you'll probably find lifers.
Additionally, I think fewer people are job-hopping considering the market is so competitive. I would expect new grads to start staying at their first job for longer, too.
There is attrition and there are layoffs. With attrition someone leaves every year or so, you part on good terms, and the company hires a replacement on a similar level and location.
Layoffs means reducing headcount, your team ends up weaker than it was, and everyone is left wondering if they are next.
I get the point, but I don't think that's universally true. Especially in the less glamorous corners of the tech industry -- yes, you have some younger people looking to bounce, but most of the people who actually keep the lights on have full lives outside of work and all things being equal, they'd rather stick around than deal with the hassle of finding a new job. They're only going to leave if you create a toxic work environment or underpay them by double-digit percentages.
For those industries, I don't think they're getting much from the layoffs besides the short-term "we did layoffs" C-suite bonus. If you're in the Widgetmaker Control Systems industry, why do you want to make your workforce think they have to leave in 3-4 years?
I’ve been at my company working in tech for 19 years and I hate the pushing of job hopping as a norm. Job hoppers have no skin in the game. They don’t need support what they build, they don’t get to see where it fell short… they really can’t learn from their experiences and mistakes. What they do isn’t in the best interest of the company, it’s just enough (an MVP if you will) to add to the resume so they can leverage it for a bump in pay on their next job.
I see wave after wave of job hoppers hired to “transform” the organization and all they ever do is repeat the same old mistakes, which we could tell them if they weren’t too arrogant to listen.
Every job hopper I’ve worked with has simply been a distraction to the greater goals of the organization to serve the customer. I’ve lost all patience and respect for the people who practice it, and the companies that set themselves up in a way which encourages it.
I don’t know how we find our way back, but I think companies and employees would all be better off with some stability and more long term thinking.
Yes, but it also takes some level of patience on the part of the employee.
Corporate bureaucracies often move slow, and they also want to see you can do the job first. I’m seeing most younger people don’t seem to have patience for this.
They also grossly overestimate their knowledge and ability. I’ve seen a significant number of people talk like they mastered a job after 1 year, then they stared asking me how they could get on my team doing what I do. I did the job they were doing for 10+ years. The reason they think it’s easy is because I defined the processes of how to do it all, wrote all the documents on how to do it, made a training program they went through, and worked with other teams to remove a lot of the toil. I then started building tools to make it easier for anyone off the street to do a lot of the work, and do it at scale. Thats why I have the job I have; it wasn’t given to me, I created it out of a desire to make the team better after realizing we could only go so far if I just worked faster. They didn’t see any of that.
For those that seemed interested, I’d give them the tools they needed to help, to see if they were the type to do this kind of stuff. I’d provide feedback, answer questions, or do anything else I could to help them. Out of the dozen or so who asked, only 1 person has done it to a limited degree. Thats why companies don’t just offer it up quickly and easily. A lot of people talk, but not many back it up.
I agree with parts of what you say. I’m a career contractor or job hopper. I like it this way. I also am aware of the volatility of the industry. I prefer hopping and getting 20% pay bump each year. This more than offsets the risk of being laid off and staying a few months without income.
I think your idea is a good faith argument, but it's a fallacy: high turnover on a job because of stiff competition for labor is not a "tech culture" issue, and it's not at all the same impact on a person as changing due to a layoff.
This is an interesting question to ask, though I personally would not attribute it to "culture" as much as it may be a product of the environment people are put in. From my experience, there are a lot of jobs that make it difficult to continue past a few years, so job hopping is the inevitable outcome of that. I think many companies need to examine why they have a lot of turnover instead of attributing it all to individual employees.
And to be frank, layoffs are scary for any industry, because they usually are correlated with layoffs at other companies. A rising tide lifts all boats, but a sinking tide is difficult to escape. You might be laid off at a time when there is no other job to hop to.
> there are a lot of jobs that make it difficult to continue past a few years
This has been a lot of my career. All my long, successful jobs have lasted around 2-3 years, and it's the time it takes for the company to realize the initiative wasn't worth it. I count four of these stints where I left, and the team was essentially dissolved within a year. I'm not saying I was the key person for the project; I just saw the writing on the wall.
It's been career limiting not having a large-scope project on a growing team, but I don't know if this is something about me, something about the projects I'm a good fit for, or the reality that a lot of projects and teams don't survive 5 years, and I've been exposed to some survivor bias of smart people who have gotten lucky.
That is a great example of what I was talking about.
Another example is the changing nature of the contracts people are hired under. I'm a scientist, and a lot of positions are inherently term-limited. You end up with a lot of organizations with two different groups of employees: employers who have worked there for decades, and employers who are temporary and work there for a few years hoping to be converted to permanent. Just like in the situation you describe, if you end up on a project that just isn't working out, that does not bode well for your own prospects. That has nothing to do with your own capabilities or how hard you worked on the project. And just like you mention, a lot of the "permanent" people have survivorship bias and do not really understand that they ultimately got lucky and timed the market well.
(Or many of the permanent people were hired as permanent staff originally and do not understand the conditions under which new staff are hired.)
The average tenure of an employee at HP is 6.6 years (source: Google AI) to pick a company that may be outside your bubble. And the lifelong career holding older employee at a legacy enterprise tech company is the kind of worker who is most adversely affected by an unexpected return to the job seeking pool.
Citing an airline for longevity is a bit disingenuous.
I’m not sure how it works with support staff, but aircraft crew have contract structures that so heavily favor seniority that most pilots and FAs will never leave a major willingly during their career.
Your observation, to me, seems more like: tech companies reward new employees over old, airlines do the extreme opposite.
I resent the fake legal douche move of falsely asserting "low performance" as the rationale for their cuts.
Some people work hard and take pride in their work. And on top of their gaming down our wages with h1b workers and low benefit contracting they have the gall to assert we're low performers when what they want is a $20 million bonus for their execs.
> Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping?
Most of us job-hop because we have to, not because we want to.
There's a class of people in the tech industry who like to write blogs about how fun and fulfilling it is to constantly change jobs and roles. Those people are highly visible but not representative. Most humans find constant change and uncertainty stressful, not exhilarating.
Because it's usually only true in your early 20s. Then you find a place and stay. These people bragging about company hopping every 3 or 4 years don't do that for 20 years.
I think many people at big tech companies like Facebook truly drank the koolaid there, and when they got laid off it laid bare that the companies they worked at were just companies. Facebook, Google, Amazon, etc are no better than Microsoft, IBM, Oracle, or whatever other 20th century company they had come to represent the answer to. I think a LOT of people had really tied their identities up in being a big tech employee and when they got laid off it was like being cast out of paradise
Because not every company gives severance during layoffs. As someone who got RIFed (again - fourth time in my 15yr career), this is the first time I've had severance, and the first time I had a notice period that wasn't just "till the end of the month". As such, layoffs are traumatic just on their own.
Adding more rapid-fire context (for the sake of brevity):
* Parents changed jobs every few years growing up, which meant a new city, new home, new schools, and a complete cycling of relationships (forcibly out with the old, forcibly in with the new)
* I watched layoffs in non-tech sectors gradually go from tech-style severance packages, to no packages beyond the required WARN notice period payouts, to filing the notices and hoping nobody asks, to now just paying out any damages after-the-fact in lawsuits
* I spent ~15mo unemployed during the "Great Recession" of '08, ending up having to move to another region of the country for work and spending a night homeless, followed by six-months couch surfing, then another month in a hotel before finally having an apartment again
So all that put together, layoffs and job changes are incredibly traumatic experiences I do my best to avoid at all costs. I am one of those "lifers" who would much rather hunker down for a good wage today, buy a home, sock away savings, and work my way up an internal career ladder than throw myself into an entirely new workplace, colleagues, culture, and standards every year or two. I claw for multiple roles in an org (at the most recent one, I was juggling roles on Private Cloud & Public Cloud, Governance Councils, leading a CaaS ops overhaul, plus other PoCs) specifically to make myself as indispensable as possible and position myself on the internal promotional ladder, because I'd rather stay with one org provided I can eke out a modest living and take care of those I care about (myself included).
Now all that aside, there's also the reality that wage growth from job hopping hasn't turned out to be as big as folks thought. The real growth comes from career promotions, which companies hate doling out internally for profoundly stupid and arbitrary reasons (hence job hopping). I get the impression most folks would stay put if they could get the growth in their career they wanted, but companies would rather hire someone externally to fill a spot than promote someone internally operating at that level; I am very much in that group myself. Heck, we're seeing that now with folks not leaving jobs because they're having difficulty finding that growth (in comp and title) elsewhere, as everyone kind of knuckles down for tough times ahead. That taste of stability will create more "lifers" as you put it, especially when the world outside is increasingly unstable; it's natural that humans (and most animals) will seek stability in times of crisis, taking only as much risk as necessary to preserve their survival.
Something the article doesn't get into is the knock-on effect of layoffs in future business: if workers are let go for what they perceive to be arbitrary or irrational reasons, they're less likely to want to do business with that company again in the future. This is particularly why tech companies offer such good severance packages, as it's their mea culpa of sorts by trying to buy themselves a good reputation on the way out the door. When everyone is doing it though (like the current layoff cycles), it becomes a broader disgust or distaste for established vendors in general, and those workers - when they land a new role - are likely to want to migrate off their employer's products unless their career is tied to it somehow. This can reduce business after cuts had already been made, potentially putting an organization into a cycle of self-harm wherein more cuts are made in response to declining business, which then causes more declines in business, which leads to more cuts, etc. This in turn leaves a huge opening for new startups to enter the hole left behind by established players, undercutting them on pricing and providing better service.
So taking all of that into context when reading the article again, and it paints a pretty telling picture of widespread mismanagement at companies doing unwarranted and highly traumatic layoffs. If the only thing your leadership can do to grow the business is to layoff staff, that's a pretty telling sign that business ain't doing so great in general and leaders are out of ideas to improve it.
per this article, Amazon 401k has a cliff vesting on matched funds at 3 years of employment. After reading around, it seems like 3 years is the legal maximum for 401k cliff vesting, with 6 years permitted for incremental vesting.
I mean in all fairness, I move around because I’m looking for a place to stay - if I’m not enjoying myself at my job, why would I stick around? And conversely, when I find a spot I like, why job hop?
And besides, the last time I was laid off, it was from a place I’d been at nearly 5 years, a place that did feel almost like family - that’s why I stayed as long as I did.
This is a terrible opinion piece. Layoffs do work. Cutting hours does not work. I am always amazed how few people understand how a business operates. They think its a community organized event where there is unlimited revenue.
There are a few basic accounting principles employees need to understand. It all revolves around Assets = Liabilities + Owner’s Equity. If you think otherwise, take a "Cost Accounting" course. This is a pure numbers game. Everyone wants to wrap a psycho analysis into something that has ZERO relevancy.
If a company is bleeding revenue, it cannot sustain the overhead of employees. They have to go. Cutting hours does nothing for those on a salary, and those that are hourly, benefit costs are far more expensive than their wage. If a company has stagnant growth, that means leadership has made bad decisions, and things have to change.
Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement. There is not a "Employee's Feelings" column on the ledger. Everyone can be replaced. No one is special, unless you're a majority shareholder.
> If a company is bleeding revenue, it cannot sustain the overhead of employees. They have to go.
No, they don't. During the dotcom bubble my company gave us 2 choices, layoffs or 20% pay cut. We took the latter. Everyone stayed and we had our pay back to previous levels in a couple years and the company remained profitable.
You can, in fact, treat people as people and still run a company.
> Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement.
This is only true of companies of a certain (large) size, when all semblance of employees being people have been abstracted away. In companies of more reasonable sizes you must take employee moral into account or you will lose critical employees which could kill the company.
Not what happened with some of the recent layoffs. Some big tech companies generate huge revenues, laid off 5-10% of people (sometimes with false pretext of performance), and do keep hiring at the same time or soon after. This happens not to reduce cost but to stress out remaining employees.
That is what happened in recent layoffs. You can look at the company as a whole and say, well they were making money. Specific divisions of the company were in the red. Many companies rotate the bottom N percent to dump the bad performers. If you're not doing your job to the best of your ability, there is someone else out there that is willing to do the job. You're not special.
> Many companies rotate the bottom N percent to dump the bad performers
I have never seen this actually happen in practice.
It's always specific teams and projects that get fired because some C-Level fucked up and pushed for some ego project, or over-hired and placed those poor souls in useless projects.
Yes, because you've never seen it means it doesn't happen. I appreciate your appeal to ignorance, but it happens in most large companies, and this should continue in most companies.
This is not what happened in recent layoffs where I am familiar with the company. Perhaps you would like to make the argument that in theory, lay-offs can be done that way.
What’s actually happened is that activist investors have bought their way onto the boards of highly profitable companies with insufficient poison pills and made them fire some percentage of workers under the guise of making the stock price go up.
Does worker happiness matter at all, or is it OK to have a net miserable company where the bottom line is slightly higher profit than it would otherwise have been if the environment were a pleasant place to work? Because that’s the tradeoff here; rabid billionaire investors are unhappy because numbers aren’t as high as they could be.
Activist investors are a problem. Most recent activist investors have been centered around climate and DEI. Exxon had activist investors try to get on the board. There was a lawsuit over it, I believe it was Arjuna Capital.
Whoever is funding these activist investors, probably a nation/state, is doing it on purpose. Natasha Lamb has to be the dumbest investors to ever live, next to Cathie Wood, IMO. You could invest in an S&P index fund and perform better at 264% for the past 11 years, compared to her 132% realized, and taking far less risk.
I get everyone has their idealistic views of how the world should work, but capitalism dominates every other society, providing better living standards, and security. It is unfortunate we have had leftists in the Democratic party take control of it, and pushing some very strange agendas, that doesn't reflect reality. These strange agendas have been exploited by other nations, like China.
Some activist investors have brought better function management and boards. Carl Icahn is a great example. But he has also brought his fair share of problems.
It is still to reduce cost. Hiring would often be in cheaper geographies. The reason to reduce cost is not to e.g. save a business from collapsing but it is to improve the financial results with the hope of making the stock price go up.
A good friend of mine has a PhD in labor economics and is now a senior management consultant for a big firm and I've been told that in general just cutting people is bad for businesses and most businesses will be worse off by just cutting people, especially without changing any of the underlying systems that got the company to the position it's in. Next time I'll have to ask him about the studies on it but there definitely isn't a consensus that general layoffs help businesses in the medium/long term. He was saying the times they seem to work best is in the context of a broader restructuring, (which in my experience is not common for companies).
Unsurprisingly, both the OP and this are oversimplified statements.
The more nuanced point is to note that simply reducing the world to accounting equations omits all of the human detail. Morale is a meaningful thing, or if you prefer, knowledge, expertise, Metis; these are damaged in layoffs, especially repeated rounds. And furthermore, the recent tech layoffs were not generally about fixing unsustainable businesses, they were about juicing profit margins for already profitable ones.
On the other hand, of course the OP title is wrong and layoffs can work. There are many examples even within tech where cutting deep is the only way of surviving.
Math wise, yes, you're correct, but layoffs can also hurt morale, especially if not done well. And in a competitive environment, the most talented people might be next to leave after a layoff, as they see things aren't going well and have the easiest time finding alternatives. I've seen that happen myself.
And some of those people you're laying off did revenue generating activities, so, as above, yes, it may be necessary to reduce costs, but it has to be done carefully.
> Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement. There is not a "Employee's Feelings" column on the ledger.
Sure they do. Just in the sense that employees feelings need to be controlled and made to fear any collective action or sense of agency.
Many larger do companies behave as if revenue is unlimited.
Too many times, I’ve seen layoffs followed by acquisitions of 10x the cost reduction from the layoffs — often even in the same quarter. And when parent company has a track record of driving acquisitions into the ground from mismanagement, where is the profit?
Layoffs are like closing factories that don't produce, cutting products that don't sell, closing deserted retail locations, and so on. Likely bad business decisions got you there in the first place. Maybe market conditions changed. Maybe your whole company is going to fail no matter what you do. But blanket statements about what does or doesn't "work" are not very instructive.
Also I'd argue that a lack of layoffs at a company probably causes stagnation and inefficiency. I don't thin the only good argument for layoffs is that a company has no choice because of cash flows.
I see this in the public sector where you often find people who have been working at the same dept for a decade or more. These people feel very safe and know they don't really need to try that hard. They also know nothing about how things function elsewhere so they'll put up with using spreadsheets and fax machines because that's just how they've always done things.
It seems rather obvious to me that a good economy is one where employers feel some nervousness about losing good employees, so offer pay rises and perks; And where employees feel some nervousness about layoffs so work hard and try to be as productive as they reasonably can be.
If a company is not cutting a few percentage of their least productive workers each year they're probably doing something wrong imo. I think it's far to argue big tech companies built up a lot of these under productive workers over the years.
Your horribly simplistic take has already received a lot of backlash, but whatever I'm angry enough to add onto the pile:
1. Big tech companies doing layoffs are not hurting on revenue, so your basic assumption is wrong.
2. "Cutting hours" needs to be steelmaned if you're not going to anything but a charlatan. That means you have to interpret it as taking a paycut, as in a salary cut. This has actually been done before in worker-focused companies to survive covid, and in one instance I'm aware of the company gave workers back pay after surviving covid.
You also ignore all the intangibles that are no easy to measure, because of course the business acumen of "make number go up this quarter" is too short sighted to care about institutional knowledge or long term strategy.
> If a company has stagnant growth, that means leadership has made bad decisions, and things have to change.
There is a bigger picture.
Developed economies across the globe are experiencing stagnant growth, and the trickle down economics they have engaged in has failed to fix that.
Knowing this, the wealthiest, through their proxies in corporate leadership and government, are cutting back their biggest cost - employees - to maximize their near term returns, which will then be put into relatively fixed-supply assets, rather than risking capital on new ventures, and the employees that traditionally requires.
Corporations are betting that "growth" going forward is going to come from AI-enabled efficiency and productivity gains, not more employees making more product or innovating on product/service development and delivery. While it's too early to say whether they are right, many signs point in that direction.
At least for public companies, accounting is FAR from the end all be all.
Most of the time, company valuations are completely divorced from valuations. And much of what public companies do these days is try to game their stock price.
Government employment is 95% the time completely divorced from reality.
That being said, private companies employee a lot of people and this is very relevant.
> Government employment is 95% the time completely divorced from reality
This is a pretty big claim to make without any evidence to support it.
The government, whether it be state, local, county federal etc. does in have a different pace and certainly like with any big organizations can have issues such as waste, but to say it’s completely divorced from reality, especially in context of somehow private (as in not government or NGO) companies don’t also act completely divorced from reality is a really big claim
Private companies generally need to be efficient and make money or go out of business.
VC funded startups are a VERY small percentage of jobs compared to ALL private company employees. But, sure, there is much shenanigans there.
Public companies can play tons of games as well - but the vast majority of people employed at public companies are at relatively efficient and profitable companies.
Government services are under no obligation to be efficient.
Often people vote for them to be LESS efficient, hoping that they'll get similar benefits from their private employers.
Though, hope is a bad strategy, and it rarely works for non-government employees.
But there's enough state employees that you don't have to win over that many private employees to win votes for things that make the services less efficient (like ever juicier retirement benefits).
> Private companies generally need to be efficient and make money or go out of business.
Half of this statement is true. A private company definitely can’t run at a loss forever. Although in the era of ZIRP a few definitely made a solid go of it.
However nothing requires an any company, and especially a private one, to be efficient. If an otherwise profitable and privately-held company wants to swell its middle management ranks or spend lots of cash employing the owners’ dubiously capable relatives, there’s nothing to stop it.
Incidentally that’s mostly true of public companies with diverse shareholders, too.
The idea that private enterprise is always efficient is a myth, as is evident to anyone who’s worked for a large enough corporation, or even a small one where management weirdly shields some obviously incompetent people for internal political reasons.
The only correcting factor is that companies can fail, and smaller competitors can sometimes find ways to undercut large, inefficient firms. But often the small company gets acquired or out-marketed. So there’s nothing inevitable about any of this.
The article cited actual statistics and data comparing companies that enacted layoffs vs those that didn't. It showed very clear evidence, even within the same industry, that those that enacted layoffs fared MUCH worse
Also many of these layoffs are NOT coming when companies are "bleeding revenue". E.g. Meta and Twitter enacted massive layoffs after posting their most profitable quarters yet
That’s what should be expected. A company in a stronger position can more confidently avoid laying off people and “ride out” the painful market conditions. Not every company’s revenue is composed of similar risk items even within similar industries. Some companies are already knee deep in some new strategy and need everyone on board to roll it out. The other company is just a bunch of variable labor that can be culled when volume shrinks. It also means they’re not investing in the future and going to get beat by a more strategic competitor. So many other riffs to take on this, but short term minded financials are absolutely improved by layoffs and that’s usually all the action is trying to effect.
I mean, everything you said is true, but only because we have deliberately set up the system as such. Shareholder Primacy is a choice we have made as a society. It's not some natural law or something carved by god into stone tablets. It's not hard to imagine alternatives, but obviously the shareholding class is going to work hard to ensure that only their preferred rules have traction. Whether or not alternatives are workable given human nature is another thread altogether.
Shareholders don't have "primacy", eg they're last in bankruptcy. If you're asking for them to never get anything, then they're not going to participate, and this is supposedly a forum about startups.
In tech the employees also tend to be shareholders which I think is healthier.
Why should you get a vote? You don’t get a vote on what groceries I buy. What entitles you to a vote on this purchase decision? (In this case “all the votes” means when making decisions on actions a particular corporation is considering, not any vote on anything)
The creation and transacting of corporate shares is also highly regulated. But it doesn’t address the question of why a third party should get a vote that helps decide a particular corporate action. Votes that limit the possible actions of all corporations equally are a different thing.
>only because we have deliberately set up the system as such.
No one can sell at a loss all the time. That's just stupidity. Either I get a return on money invested later or I get a return on my balance sheet now in the form of profit. Shareholders primacy is because they can only be cut trough a buyout.
Why can’t the outrageously overpaid leadership who made the mistakes be the ones who are punished instead of the individual contributors who are just trying to survive?
> After the early-2000s dotcom bust, Bain researchers found that stock prices for S&P 500 companies that had no layoffs or laid off less than 3% of their workforce increased an average of 9% in the next year. Meanwhile, stock prices were flat in companies that laid off between 3%-10% of their workers, and prices plummeted 38% for companies that laid off more than 10%.
Failing companies go through layoffs. Companies like Sun Microsystems, Kodak, Sears, Circuit City, Kmart all went through lots of layoffs. But everyone knows that's not what killed them.
Another addition I'd like to add here is more often then not wrong people get booted while the "dead weight" tends to stick around and becomes even deader due to a motivation fall from the layoff. So maybe it doesn't kill, but for sure exacerbates an already bad situation.
We are a small team in big company, and management that made wrong decisions is still somewhere there but not my direct management, still getting same paycheck, car, cards and benefits but new managers (that accepted to take over and got brand new car for 100k€, cards and bonuses, bells and whistles) started to layoff workers so we know this is the end for my team, and of course they will do whatever it takes to "save the product", but not fix the the real issue... lack of good developers to fix terrible bugs in our product.
That’s really the key part: if the managers who created the problem are still there, layoffs will just make it worse. There are cases where getting out of a dubious business line can lead to long-term benefit but I’ve seen that a handful of times compared to losing useful people while the bad managers failed upwards.
That's basically the story of Philips. They go through a tough period and choose to divest a "dubious" line of business to focus on higher margin products. The new company, freed of Philips management, goes on to surpass the revenues of the parent. That's how ASML and NXP were born. Signify (Philips lighting) is getting reasonably close.
If your small team in a big company does not directly generate money, then you’d definitely be ripe for elimination. Time and time again we’ve seen examples of trams that are critical to supporting various revenue generating parts of the company while not directly making money themselves get cut as an “obvious” way to save money when only looking at the books. Been there.
The thing is, ending a product that's not making money shouldn't mean eliminating the workers. Those were people you picked, brought in, and have adapted to your culture.
It always strikes me as weird when a product fails and the decision is to eliminate everyone from the product manager down... and then make no other changes. Then they bring in completely new people for whatever the new product line is. Sometimes, sure, an individual or group might cause a product to fail that should otherwise succeed. But it's weird to default to the production team. Is it a design problem? A maintenance problem? A product price problem? A sales and marketing problem? A management problem?
Like, the Pontiac Aztek did not do badly because one welder from Mexico screwed it up. It failed because it was ugly. It was ugly because the styling didn't survive the requirements to use the same parts as the Buick Rendezvous and the same basic platform as the Pontiac Montana. The process of making that vehicle fit into GM at that time killed the product. Today the Chevrolet Equinox, a direct descendent, is one of the best selling vehicles on the road at a time when there's a lot more competition.
Workers cost money. Layoffs don't just happen, they happen when management is under pressure, usually because they won't make payroll in a couple months, occasionally because the stock market demands better margins.
I get that you have no experience at that level of a company but you could spend some time researching it.
> Time and time again we’ve seen examples of trams that are critical to supporting various revenue generating parts of the company while not directly making money themselves get cut as an “obvious” way to save money when only looking at the books.
Love how your typo turned into a beautiful metaphor for infrastructure being cut.
Some are kind to eng ICs, you’re not laid off from the company just given time to join another team. As you can still be a high-performer with context on company culture/tech stack while on a non-revenue-generating team.
Even if,
from the company's perspective,
if lays off all the "right" people,
some of those people will be "wrong" from the point of view of other people on the team.
Maybe the company didn't value a certain person,
for corporate or HR reasons,
but there's always a chance that person was a valued team member for human reasons.
Layoffs will lead to people leaving,
regardless of how surgical or random they are.
Exactly. Somebody who is universally hated by their co-workers should just be let go. Nothing to do with a layoff. So everybody who is around has some reason for actually being there. In a well-managed place, that is.
> Somebody who is universally hated by their co-workers
How many times have we seen a company fire whoever they consider "dead weight" but keep the universally hated guy because he's a 10x rockstar whatever?
A 10x person who brings down 20 others to a small fraction of their potential and causes other rockstars to leave is still net-negative. Good management understands this.
(And I'm not sure why I'm downvoted for this. Nothing about that should be controversial?)
Exactly. So the company keeps the guy everyone hates after laying off people that get along. The next people to leave the company are the ones disgusted by the move.
Depends on the company. I've seen the opposite case were such a person was let go, much to everybody's relief. Some people had to clean up his mess, which was genius in the sense that it worked flawlessly, but nobody else could maintain it, so he had locked in a minimal bus factor. Which makes such a move harder to execute, but the earlier the better.
Indeed. Like everyone from Lake Wobegon, I think that I am effective at my job. One of the most productive things I can do is to strangle bad ideas in the crib. This is not a popular role. Killing someone's pet initiative can make enemies. Yet, it can save countless weeks/months/years on doomed-to-fail efforts.
Working to not be laid off usually means just keeping your head down and going with the flow.
The key takeaway for me is that layoffs are an effect, not a cause, of company failure.
The quoted text is a good example of this. If a company is struggling strategically or economically, and doesn't do a layoff, it's just going to struggle more, and fail more quickly. Companies that aren't laying people off are likely not even considering layoffs, because their businesses are actually doing well.
So, it's pretty obvious to me that companies in that cohort would see the biggest stock price appreciation, because layoffs are an indicator of poor future performance.
There is the question of if layoffs saved the company enough to save itself or improve? And with that data you could say layoffs by themselves don't.
Today the question is why companies making good profits are making layoffs. And looking at the damage they cause is relevant in trying to predict company performance
> And with that data you could say layoffs by themselves don't.
I think that is one inference too far? Layoffs may have saved some of those companies from bankruptcy. The Bain study is looking at share price performance and offers no data that would resolve that question.
If the layoffs are taking a company which could be stably growing to one which is going downhill - in that case the execs actually hurting their long term compensation.
But i get it, it's like junk food for execs, easy to do, crisp in the action (even if not in the effects). But consumed carelessly its bad for company health
There's a big tendency to look for culprits whether layoffs, PE, MBAs, or whatever. But a lot of companies just made wrong bets or were in the wrong place at the wrong time. Kodak was never going to survive in anything like its pre-digital form.
You skipped the second part of my comment. Yes, senior execs at large publc companies--assuming they didn't do anything actually criminal or stupid related to their own finances--generally come out the other side OK. But sometimes a company can just reasonably get into a place it's hard to come out from. Kodak is a really good example IMO.
Maybe I'm expecting too much, but for me the only good reason a CEO is paid more than any actually useful employee of the company is to anticipate this kind of thing and use the money from their leadership position in the old tech to invest and not be in a very bad position with the new tech.
Sometimes companies just aren’t in a good position for historical reasons. Returning to Kodak you can’t really say to your investors and employees 90% of our existing business is toast and we’re going to churn everything over the next 5 years.
Sometimes you can do things more incrementally but other times it makes sense to basically close up shop and maybe shop your brand and some assets while keeping the biz afloat at some level with a lot of people still collecting a paycheck.
Also, failing companies that use layoffs to restructure can succeed. For an example see IBM in the 90s. It’s hard but possible. And since the article uses stock price as a proxy for success, IBMs stock struggled for a long time afterward. It hit an all time high in 2025.
And then there are non tech industries that just go through cycles, like oil.
This correlation isn’t necessarily causal. Companies that are failing are more likely to layoff could be just as true as companies that layoff are more likely to fail.
Had been advocating slower hiring & targeted reductions in a mid-sized tech firm for years after COVID, but it happened much faster under a newly appointed CEO.
Under new leadership, we executed 1/3 layoffs framed as a "culture refresh" and to briefly lift the stock. It wasn't about survival, we had plenty of cash, okayish growth and fantastic ARR - more about a new corp-backed CEO adopting a "do-it-like-Elon" approach.
Being mostly Europe-based but US-led, it turned into a massive and costly process (Americans don't exactly dig EU/UK workers rights - Spain was the biggest shock), stalling most productive activity for half a year. Internal trust and brand perception tanked. Since it began with ousting old execs, it quickly devolved into a blunt-force exercise with no internal knowledge, led by scared managers with percentage targets - many good people were cut. Managers hesitated to shield talent, given the "culture reboot" framing. I ended up personally cutting entire offices.
When the CEO's broader strategy failed (for reasons beyond layoffs), high performers started eyeing the exit. Ironically, many first saw the layoffs positively - COVID overhires had left uneven team dynamics, and some dead weight was on high salaries. But when it became clear there was no coherent plan, people began leaving.
That triggered a chain reaction. Senior hiring pipelines dried up (reputation matters, esp. when your top-talent is on the way out and is loud about it), and panic set in. Eventually, it turned into survival mode. The CEO didn't last long after that.
There’s weirdly (to intuitive sense and business zeitgeist since the 80s or so) mixed data on layoffs in general. There’s a decent chance they cause more mid-term harm than good, most of the time.
They also didn’t used to be a regular feature of business.
It’s funny how such things become “ordinary” and “obviously good things to do sometimes” that haven’t always been the former, and may not really be the latter either.
Business management is vibes, trend-following, and fear of straying from the pack. And the best of that is vibes! That’s how bad it is.
You nailed it. In our case, EBITDA margins were "pencil on a napkin" at best — only because the CFO is usually the sanest person in the room. At the same time, Elon's moves and Meta's "year of efficiency" were super influential.
A lot of what happens in the boardroom or C-suite is "stick with the crowd" — e.g. template-based "tech modernization." (That's often a new CTO's hedge if the real problems are too hard. Just "go Cloud" or "go AI" for five years — four vests, one to jump off.) You broadcast confidence, you own the narrative. Which means never, ever saying "I don't know."
This is especially common in PE "turnarounds" or post-IPOs after founder exits. And it's especially harmful there because current staff is often seen as a liability, not an asset.
I thought a lot about this after the layoffs, and I think it boils down to how "professional C-levels" see execution as a commodity. They tend to overemphasize leadership (sometimes self-serving, but often genuine) and resource availability. The focus is on "what?" and "how to pay for it?" — with "how?" left to be figured out on the go.
I don't think that's completely wrong. Sometimes execution is a commodity. But not when you're short on time and planning for a rapid sprint.
> But when it became clear there was no coherent plan, people began leaving.
I see this more any more, to the point of wondering what % of execs and decision makers are actually meaningfully good at the job? When times are good, any exec action will turn out fine. But when times are tough, who is worth their salt?
And if all these decision makers are bad at decision making, what would a better organization look like?
There's definitely a "peacetime" / "wartime" divide. There's also an overreliance on pedigree. But above all, it's the pressure of being a public company (which often means losing the founder).
As a new CEO, you have to impress the board and investors without really knowing the company. You probably get two earnings calls - six months at most - to prove yourself. That's nothing, even for a senior dev, let alone an exec. And if you're being brought in, it means the company isn't in great shape - or is at least perceived that way.
You don't have time to really figure out how things work, and even if you did, it's political suicide. The board didn't hire a "looks fine to me" person. They hired a fixer. So, it turns into narrative games and rapid actions with massive tail risks.
I don't think it's a people problem. It's a system problem. Leadership replanting is hard, but it's one of the very few tools in the board's toolbox.
UK was horrible. No real protection for workers - just layers of mandatory legal mumbo-jumbo with zero actual chances for people to keep their jobs. It was like ripping off the band-aid 1mm at a time for four months.
Spain/France were an employer’s nightmare. Anyone without another job lined up secured a "special deal"—workers have massive leverage, they know it, and they’re actively litigious. People on parental leave had close to a year of guaranteed no-shows. The reaction was, of course, "never again" rippling across American corporate circles.
The rest of Europe was okay-ish.
US was predictably the easiest. We were generous with packages, but it's easy to see how the system can be used to screw people over.
Middle East was the roughest. Visas in UAE/Qatar expire instantly, and the local tech market is almost non-existent. We extended until the end of the school year to help with visa concerns, and some people managed to arrange golden visas. But for many, it was a massive shock — losing both jobs and residency overnight.
> Research has consistently shown he was right about layoffs: They’re damaging to companies...
The research is probably misleading. The damage was done to companies when the over-hired people who couldn't add enough value to justify keeping them employed. The layoffs are just when the damage is recognised.
It is like borrowing a huge amount of money, using 90% of it it to buy prawns and leaving them out to rot for a few days. The damage is now done, the borrowed money is lost. It won't be recognised for a while though. There is even enough left over to pay an interest payment or two to string everything along. But the damage is done.
A lot of people treat economics as though damage didn't happen unless someone acknowledges it. That isn't how it works. Not acknowledging that something is value-destructive just means more value is destroyed by the time people are forced by market forces to confront the truth.
This isn’t how all layoffs work though. Some, yes they are due to over hiring and a failure of management to plan. They are likely necessary for survival of the firm and generally last course of action. Although even those come with a cost to current and departing employees which harms the business.
But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better. Those come with a temporary balance sheet boost and all of the negative effects of any layoffs.
> But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better.
That has to be matched with a strategy of intentional overhiring though, and the damage is being done there. That is the insight that should be drawn from the research - intentionally doing something silly (in this case, overhiring) is a classic form of waste and economically destructive. Layoff or no layoff, the problem is the management team has set up a situation where they believe a big chunk of their workforce is unproductive.
This does raising the question of why boards and shareholders tolerate these clowns. To me the obvious answer being that the major central banks have a history of printing money and handing it out to asset owners, so hiring competent managers for said assets is a lot of trouble for limited gains - even weak managers are enough to drink from the money hose. But who knows, maybe the analysts think that a small amount of sillyness averts a greater problem.
>But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better. Those come with a temporary balance sheet boost and all of the negative effects of any layoffs.
This feels like a "no true scotsman" argument. The headline of the article is literally "Why layoffs don’t work", not "why consistent layoffs don't work". The only mention of "consistent" layoffs were when referencing Jack Welch's management style, but that was more of an attempt to argue that layoffs are bad by citing the worst possible example, than trying to introduce nuance between the types of layoffs. The studies cited also did not distinguish between the type of layoffs.
Clickbait headlines aren't anything new. While a better headline like: "How the Layoff Culture that Started in the 80s and Spread to the Rest of Wall Street is Actually Harming Business's Long Term Prospects" would be better, punchy headlines like this one spur clicks and conversation as seen by this thread.
I believe we took different things from the piece and I imagine you'd disagree with my better headline. I understood the piece to be telling a story starting with Welch and Dunlap of how layoffs as a way to improve numbers actually damage those same numbers in the long term.
> But the ones being discussed in the article are the consistent ones.
I worked at GE when Jack Welch was there. First of all we never had a systematic firing of the bottom 10%. That is a myth. We ranked everyone each year and clearly identified the bottom 10% but they were not always fired. The manager did have to have a development plan for these individuals.
More importantly, GE did have consistent layoffs. I assert this was a good thing. I vividly remember asking an EVP at GE Capital when I first joined GE why we did this. It seemed inhumane. Wasn’t it better to try and fix the so-called ‘C’ players? His response fundamentally changed my view on hiring, leadership, and firing. He told me two things. 1) Hiring people is always a gamble. The best interview/onboarding processes will not produce 100% success. There will people that do not have the skills that are needed. There will also be people for whom GE is simply not a good cultural fit. 2) In good times, when a GE business unit is doing well, they always over hire. People working 50 hours a week want to work 40, process problems that have built up need to be addressed (similar to tech debt), etc. Over time this leads to bloat and inefficiency.
For these reasons, consistent layoffs make sense for the company. They also make sense for the employee. By not waiting for an economic downturn and then making dramatic cuts, the exiting employees would have an easier time finding the next job as odds are the economy would doing well. Particularly in the case where the person was not a good fit for the GE culture, they learned this and could find a better fitting role elsewhere. And GE was great on the resume back in those days (sadly not so today). If we waited for the downturn, then the exiting employees would be looking for a new job in a bad economy with everyone else who had just been laid off. Not a good situation.
Finally, an additional point I learned later by observing when and where we made headcount reductions. GE made many bets on new markets, new products, etc. We had to if we were to grow by 10% each year (GE Capital’s rigorous requirement for business and strategic plans). The successful GE leaders understood is was easier to grow revenue to achieve 10% net income growth than to cut expenses. Unfortunately, not all new business ventures worked out. In those cases, we had to make a decision to shut them down (all new ventures had off-ramps). As a result, some people were repurposed, but others had to be let go. I posit that is consistent with the tech approach of “fail early, fail often.” In industries with significant people required to try a new approach, the consequence of failing will be layoffs.
I don't see much reason to think mass layoffs are typically the result of over-hiring rather than a reaction to changing circumstances that are different than when the hiring originally happened. The article opens with a perfect example, the constriction of the US air travel market following 9/11. The people most airlines fired as a result weren't "over-hired". Their hiring made sense at the time and they were fired when circumstances changed. I'd argue this is likely more often be the case than actual over-hiring, since it's easier for a company to see if they can actually utilize new employees now than it is for them to predict the future.
In cases like that, the layoffs really do seem likely to be damaging to the companies. If circumstances change for a company and they can no longer effectively use all their employees, the most obvious solution is to get rid of employees, but it then makes it far more difficult to recover when positive opportunities present themselves. I think companies trick themselves into believing that since hiring and firing employees is relatively quick, it's a good tool to adapt to changing circumstances in either direction. But that ignores the time it takes for a new employee to become fully productive and the increased difficulty/cost in hiring new employees if your company has a reputation as an unreliable employer. It also ignores the potential boost to productivity that can come from employee loyalty and job satisfaction and security.
The latter points are true. But it's also the case that radical reskilling for very different job roles (with possibly rather different market salaries and, honestly, different from many people's job preferences) is tough too. Probably hard to come up with reliable rules.
I have tried and failed to understand what is meant by "layoff due to overhiring", in the context of Software Engineering. When an engineer is employed in a successful project, they are incredibly profitable. A handful of engineers can write and maintain products worth millions of dollars. Big companies, which are the ones we discuss when talking about "overhiring" should be capable to find or create projects where an engineer will be at least modestly profitable. And having an employee creating a small amount of profit, who might eventually be moved to something that's better, is certainly more profitable than firing him and paying severance.
Note that here I'm talking about firing good performers because you have "too many" of them. Firing bad performers because the estimated cost of training them is not justified, I can understand.
The only explanation I found satisfying is that investors heuristically care about profit per capita(ppc) as well as total profit, and employees who don't produce _enough_ profit reduce ppc and thus investment to point the opportunity cost of firing them aligns. You'll make investors happy, which will raise valuation, more than what you are losing from the lost profit. But this is not "rational" in a full information economic sense. It's essentially the company virtue signaling that they are capable to fire if they had to, even at the cost of actual dollars.
> A lot of people treat economics as though damage didn't happen unless someone acknowledges it.
This is what I call the TV effect. People are trained from an early age, by consuming media, to only construct what is "real" by what is announced. And it's not just economics, but all sorts of aspects of life.
Is it not incumbent on the company who hired the employees to ensure they are utilized sufficiently? Why imply it’s the worker’s fault for their own mismanagement?
>Why imply it’s the worker’s fault for their own mismanagement?
I'm not sure how you got the impression that OP implied it's the worker's fault. If during the 2021-2022 boom, some startup hired a bunch of junior programmers for $200k/yr, I think describing those people as "people who couldn't add enough value to justify keeping them employed" is a fair assessment of the situation. It doesn't imply that it's the junior programmer's fault, any more than it's not my "fault" if I'm asked to play a musical instrument with no prior experience, it sounding terrible, and people asking me to stop.
This would be more true of management did not play BS with the numbers constantly.
I worked at a firm that for 2-3 years straight would report great Q1,Q2,Q3 numbers.. tell employees it's looking like a good year. And then Q4 report a total wipeout loss that negated the quarterly earnings and swung the company to flat or a loss. Whoops, sorry, no raises, cutting bonuses.. and need to do some layoffs.
Behavior like this reminds us that the numbers are not real real in a scientific sense, but only in a relativistic accounting sense.
Similarly when goals are linked to earnings and the company reports adjusted earnings... So changing the earnings by disregarding some expenses or some sales out of the calculation. The one in charge of this adjustment can play to allow or dismiss bonus for the year.
Some people will really do a lot of mental gymnastics in order to consistently blame workers instead of laying the real blame on poor leadership for company failures. If your company is failing because Tammy isn’t a “rockstar” at her job, you have a terrible company.
You don't know what you're talking about. People are fired when they can't add enough value to justify being employed. Sweeping industry-wide layoffs are different. Eg the "damage was done" to the aviation industry in 2001 due to plummeting demand, due (obviously) to new fears and hassle inhibiting travel; the damage currently being done to companies in the economy is from interest rates, inflation, trade uncertainty, stock manipulation, ...
> You don't know what you're talking about. People are fired when they can't add enough value to justify being employed.
That depends upon the employer. Layoffs occur for a plurality of reasons and the persons selected for termination are selected by various different criteria that may include quotas or random selection.
'The research is wrong because I said so' isn't exactly a compelling argument, and certainly not a strong enough one when you've been in the modern workforce long enough to recognize how badly layoffs are conducted at just about every company. I've seen enough 10x engineers get laid off to know that the idea that companies have any idea as to who is actually productive or not is just false.
1) But I included an actual argument and, furthermore, it assumed that the research is correct.
> I've seen enough 10x engineers get laid off...
2) That is sensible for the company. They have no idea how to use a 10x engineer, as can be detected by the fact that they're having layoffs. They don't know how to create value in the market and they're being forced into a position where they have to squeeze what they can out of what assets they have.
It isn't economically rational for them to employ 10x engineers in that sort of environment. The global and local optimum is to let those engineers go so they can do something valuable somewhere and keep some more 1x style engineers on the cheap.
If a company is having layoffs, that is the invisible hand of the market writing on the wall "THIS MANAGEMENT TEAM DOESN"T KNOW HOW TO MAKE MONEY AT THE MOMENT, STOP GIVING THEM IMPORTANT RESOURCES". That includes 10x engineers.
Unfortunately as I've seen countless times, it's also writing on the wall to the management team "TIME TO MOVE ON CAUSE DAMAGE TO ANOTHER COMPANY", I don't know why we don't expect management's head on the chopping block. If a captain orders a course into an iceberg, idk why we can't just hang the captain and course correct.
That's how I feel about it too, the times I've been around layoffs management and the executives all talk about a difficult economic environment and making the organization leaner by firing a bunch of IC's. Never once have I seen a C level say hey we steered the company in the wrong direction its time for new management or hey our CFO failed to communicate the economic environment and caused us to overspend so we're going to look for a new one.
I know it's ridiculous to expect them to blame themselves but the fact that we just accept this lack of accountability from executives/management in the corporate world is insane to me.
Execs go on to "pursue new interests" or "spend more time with family" all the time. They may get pretty good packages to do so but it absolutely happens.
> 2) That is sensible for the company. They have no idea how to use a 10x engineer, as can be detected by the fact that they're having layoffs. They don't know how to create value in the market and they're being forced into a position where they have to squeeze what they can out of what assets they have.
Okay, now explain why every company is encountering these issues where they're frequently laying off people and are unable to create value. The frequency of layoffs is diametrically opposed to your thesis because otherwise companies would behave in a way to reduce layoffs. Such as hiring fewer employees and encouraging longer term retention.
> If a company is having layoffs, that is the invisible hand of the market writing on the wall "THIS MANAGEMENT TEAM DOESN"T KNOW HOW TO MAKE MONEY AT THE MOMENT, STOP GIVING THEM IMPORTANT RESOURCES". That includes 10x engineers.
This is basically the Just World fallacy but applied to the free market. If something occurs then it's justified as a perfectly rational action of the invisible free hand of the market. In reality layoffs are rarely conducted by the people most equipped to do them, but via a mandate from heaven that you must cut your team for the sake of Number even if you're one of the most efficient teams in the company.
I remember hearing a take on layoffs that I think is pretty true: When you fire the bottom 10%, you lose another 10% who are from the top performers. The destruction of psychological safety for everyone at the company is irreparable, and you start to bleed your most productive talent, too.
I've seen this happen. I worked at an extremely efficient company that had a great product. We got acquired, and within months, were part of the acquiring company's yearly mandatory layoffs. They fired a bunch of (apparently random) people to meet the quota. This absolutely destroyed us. Morale was just gone.
Within six months, about a quarter of our employees, mainly top performers who could easily find other jobs, left voluntarily.
The whole thing self-destructed within another year, and the product we worked on was abandoned.
Enron was famous for this. Supposedly it's a practice that Jeff Skilling learned at Harvard business school, where the bottom 10% were flunked no matter what their absolute GPA was
Owners made half a billion and got high-ranking positions at the buyer.
Buyers bought it because they had a very specific problem that the product was designed to solve, and thought that it would be a competitive advantage to deny the solution to their competition. On paper, it was a good decision.
I don't know if I'm a top 10% employee, but I'll share how layoffs influenced my decision to leave a job of 5+ years. I started looking for a new role after they announced the layoff of about 200 people in my organization. When I finally got an offer, I kept going back and forth on staying and negotiating or accepting the offer. There were many other reasons why I left, but a huge factor were the layoffs. I just kept thinking, they already had layoffs, what's to stop them from laying me off next? It's also a crappy feeling thinking that you/your team can be on the chopping block at any time.
Top performers have options and value stability. They also know that they rely on their manager to accurately reflect their work up the chain.
Some percentage of top performers report to deadbeat managers, so in an environment doing mandatory layoffs, they'll know that it doesn't matter how much they knock it out of the park, their manager will screw them. So of course they'll leave.
If you're a top performer stuck under a deadbeat manager, how are you able to signal to new companies that you're a top performer?
I read posts here all the time about how hard it is to hire. How do top performers distinguish themselves as they go out for new jobs? When did this become easy?
> How do top performers distinguish themselves as they go out for new jobs?
During an interview process, and by using your network. Top performers aren't usually slinging applications through LinkedIn in my limited experience
> When did this become easy?
It isn't, they're referred to as top performers for a reason. It's easier for folks who excel in their fields, and that holds true across domains.
Because people will often see people who they don't perceive as low performers getting lumped in with 'low performers' and laid off. At that point, you start looking for management that seem to know what they're doing.
because they see the company struggles and is not loyal, as top performers have plenty of options they will be more likely to take a better offer when it comes along. Top performers will not leave the same day but bleed out over a bit longer timeframe. The most popular example is woz hesitating so much to leave HP because HP was loyal to employees and woz was loyal to HP. Imagine the same situation when HP had just let go 10% of employees, he would not have thought about it twice.
Top performers are generally pretty sharp. If they recognize the company is struggling and decide they have a better future elsewhere then that’s where they’ll go.
Anecdotally layoffs leave a bad taste. I worked at a smallish company that laid of 20% going into covid and within 2 years most of the best talent churned out.
I have only ever quit jobs in response to layoffs. Layoffs demonstrate to me that the company is apparently low on cash if they need to fire people to make ends meet. If they are not low on cash, it means that they will arbitrarily fire anyone in order to pump up their stock.
Though I've never personally been laid off, it's a black mark on the company that I think you can never recover from. It means I will never trust anything said at a quarterly all-hands. The projections they give us employees are spun to be more positive than they really are.
During COVID, my company told us that we were going to be able to save money by breaking the lease on our office building and stop paying for amenities like the snacks in the break room and catered lunches (since nobody could use them anyways). This, they said, should save us enough money that we don't need to lay anyone off!
10% of the company was laid off a week later. The next day, I would later discover, the company applied for a PPP loan: they had laid people off pre-emptively so that they wouldn't be penalized for it next year when they sought to have their PPP loan forgiven.
It illustrated to me that you can't trust leadership, ever. Once a company initiates a layoff, it's a permanent black mark on that company
I think because - if you fire a poor performer, everyone kind of gets it - they weren’t doing a good job, they’re a drain on company resources, they’ve got it coming, basically.
But lying off isn’t firing someone for performance - it’s admitting “we don’t have enough money to pay you”
And that’s something that should be scary to everybody in the company.
When your shitty coworker gets fired, you shrug and say, yeah, saw that coming. When your shitty coworkers get laid off, you look around nervously and think phew, l lucked out.
I don't think its only psychological safety. If the top performers lose staff that did the mundane crap and now they have to do it they start to really pay attention to what the management is actually doing.
Every layoff I have ever survived the staff inevitably ends up talking about how so and so manager and his favorite buddies are still out golfing every friday. Why the f are they still here etc.
Companies churn through people constantly. Google famously has an employee tenure of like a year[1]. Most companies that subscribe to the Jack Welch "fire your bottom 10% yearly" philosophy don't usually declare a media stock-pump "layoff" but are just letting go of purported non-performers constantly. And there are a lot of "top 10%" performers who are very happy that the so-called deadweight isn't kept around just for some foolish notion of "loyalty".
Sometimes layoffs are unfair, and sometimes the wrong people are let go. But often it's entirely necessary and the right people are let go.
[1] - Which makes the whole gruelling, multi-month hiring process positively ridiculous. It would be much better for this industry if companies hire fast and fire fast, instead of delusions that they're finding the magical employee base that will be with them forever.
The Google tenure stat is misleading because it was taken at a time when the company was growing 20% per year. The actual statistic worth looking at was how long a person who is leaving had been with the company on average at the time of leaving or what percentage of the overall headcount leaves per year. While I don't feel comfortable sharing those numbers, I can confidently say they lower than the industry norm.
The industry norm is incredibly short tenures, and often when it starts increasing, it's paradoxically when the company is on the track towards complacency and eventual failure.
This isn't some Google specific thing. The cargo cult "look at our super exhaustive, endlessly demanding hiring process" is a farce everywhere. It's actually a bit paradoxical because it actually selects for employees who don't want to actually stay with you, they just want to be able to say they were willing to endure your gauntlet.
I’ve worked in places where people stuck around for years because they believed in the company and technology and wanted to successfully ship a product. In fact, I still view repeated 18-month stints as a bit of a red flag.
It’s a big industry. There’s a difference between a norm and something that a sizable subset of people do.
I think if you look at companies like Citadel, which routinely fire the bottom 10% as part of the job description, it attracts a certain set of people who actually do feel "safe" in that environment. The trouble comes when you break your norms about layoffs.
Also, Google's median tenure of <1 year was due to hiring, not employees leaving. In other words, that number included people who hadn't left yet. I think if you look at people leaving Google, average is about 3 years.
>Also, Google's median tenure of <1 year was due to hiring, not employees leaving
Google would have to be growing at >300% per year for this math to make sense.
But even if it's 3 years ({X} doubt), that's still cartoonishly low for a hiring process that drags on for months and months.
>I think if you look at companies like Citadel, which routinely fire the bottom 10% as part of the job description
Almost all tech companies target firing/pushing out a considerable percentage of employees per year. It actually is incredibly common, even if it usually doesn't make the news. They used to do it overtly via stack ranking, but now they just do it more quietly. Microsoft punted 2000 "low performers" in the first two months. Brutal firings with zero severance, immediate cancellation of health coverage, etc.
I’ve been through several waves of corporate layoffs across many industries.
Some observations:
1 - It’s rarely one round.
2 - Companies tend to be the most thoughtful on the first round. Then it looks easy and the precision (and severance) of future cuts goes down. That’s why it’s smart to take a voluntary offer.
3 - Cuts that are broad based (“Every department cuts 15%”) are a sign the company doesn’t know what’s going on or prefers harmony over hard choices.
4 - Layoffs can be a crutch for firms that don’t do performance management. (Less work to do a layoff than have managers counsel bad performers out)
“If we reduce the number of employees for better short-term financial results, employee morale will decrease,” he said. “I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.”
software development costs are out of control the whole industry is one big grift, there’s no accountability anywhere, 20% of the devs are doing 80% of the work, the business would instantly terminate the 80% for cause if they could only discern the difference, but they can’t, because the business side is also a big grift with the exact same problem all the way up to the founders recursively
It’s not the devs who are bloating development costs. It’s the layers of management making hour long meetings to discuss button placement.
It’s the hours of retros, design meetings, and skip-levels designed to remove any personal investment or sense of ownership from everything.
Since so few individuals are trusted with real decision making power, you need a lot more people to achieve some kind of consensus/buy-in so that you can ship anything.
The devs are at the extreme bottom of this totem poll.
It’s like blaming construction workers for houses being expensive.
And, ofc, that goes without mentioning the multimillion yearly bonuses for C-suite, but we can just forget about that and blame the lowest ranking corporate employees (devs)
Source: I worked at a large tech firm for many years and saw this over and over again.
Right every step of every dev task is ticketed, scheduled and measures within a millimeter of its life in many orgs. The people working the tickets aren't to blame when it all goes wrong in the big picture.
I've worked at shops with agile coaches, consultants, product teams, multiple management layers, etc all attending agile planning/retro/blab sessions. They always had really strong opinions on the minutae of each footstep (tickets/sprint), but couldn't speak to where the path was to take us. Essentially zero quarterly let alone annual planning.
A lot of management these days is the equivalent of driving and saying "I'll decide where I'm going when I get to the next stop light", repeated every 2 weeks.
> I'll decide where I'm going when I get to the next stop light
Surprisingly, this type of iteration can actually work; but the caveat is that the people behind the wheel, and reading the maps, need to be very good, and also, experienced enough to make sound decisions. If mediocre (or inexperienced) people try it, it’s a disaster.
From what I can see, the entire tech industry has been institutionalizing mediocrity, so this type of approach is not really available.
It doesn’t sound like the type of iteration matters at all.
If your leadership is good and competent, they can drive the company any way they feel and have it work.
The most productive I’ve been in my career was when my PO put all tasks that needed to be done in a Google sheet and the whole dev team spent a week just picking tasks off the list. It ended with us shipping our app on time.
No planning, no grooming, no nothing.
It was a high trust, high ownership team.
Generally you see stuff like this turn into bikeshedding and/or sales features only. Way too often I see companies push for new features because they will generate sales that in the long run cause more customer loss because performance and stability was neglected to implement them.
If you’re copying this approach from someone who copied it, after hiring an agile coach and reading the phoenix project, you are likely definitionally mediocre.
Also it’s not a one size fits all solution even for the competent. Requires a more direct interface and two way dialogue with users than most devs actually face.
Second that, scrum teams having 3 business analysts, scrum master, product owner, ops/it, ux designer, 2 testers, 4 developers is basically how it goes.
I’m not saying just leave everyone to their own devices, but some individuals should be able to have ownership and make decisions without layers and layers of process.
Ofc decisions can have consequences, but that’s what the high pay should be for.
It’s not a black and white issue and I don’t think you need to present it like one.
A more risky job should be compensated more ? It'd be the opposite, if it's risky then the variance of the income should be greater (success = more income)
I don't want to present the problem as black and white but merely express a simple idea : developers DO want to be managed to simplify their lives and focus their time on more important things for them
It’s the devs too. Do you really need an army of developers to build a web app or put text onto screen? No, a small team can easily handle that much faster and at higher quality without all the framework bullshit.
You also have to consider that developers are not sales people. They are a cost center.
Heh, and there's at least one FAANG where it's not even the layers of management.
They've just removed a huge amount of manager discretion and initiative through multiple top-down dictates that are pretty much killing any low level desire to really innovate and try risky initiatives.
IBM, but with same level product market fit as IBM had for its mainframes, but in this case for markets 100x more important for the global economy.
Got news for you, too: it's both. It's the useless management, it's the "developers" who send me screenshots of stack traces while they cry and soil themselves because they have no clue what they're doing.
The big tech companies paying the largest salaries are raking in billions in profits. How does this square with the view that software development costs are out of control?
Layoffs today seem more like execs following management fads for easy visible actions and this data would suggest that the actions are actually detrimental to company profits. Juice the numbers for a quarter but add another long term drag to the company
Just because a company can be overall profitable doesn't mean costs aren't out of control. If you make enough profits, you can literally feed money into a shredder and still come out ahead if you earn profits faster than your shredder can eat them.
What you're describing isn't out of control, all businesses have income and expenses, good management is watching both sides and building the organization that connects the two in the middle.
Sudden drastic moves if the business is delivering profits seems like the out-of-control action to take. If the business salary structure is off, or if you need to a different skill mix there are ways to shift that in a profitable business without sudden layoffs damaging the very organization that delivers your current profits.
So maybe we don't take jobs away from people with families and mortgages then, if all we have to do is sacrifice some profits, yeah? Gee, maybe the company can only make $9 billion instead of $9.5 billion, and everyone can stay employed.
The twist is that when you layoff the 80% who supposedly only did the 20% part, you pretty much still have to hire the same amount of people to do that 20%.
But with lower rates, and with abysmal rampup period (or even afterwards).
Don't blame managers, they just follow money, why else would they work those crappy jobs. Blame idiots who think short term bonuses should be massive instead of some long term performance and investment of oneself in company's success.
Blame the board, full stop. "Follow the money", there is really no other possible answer. Some set of people are responsible and to determine who that is, you read the corporate ledger, you read the financing contracts, you read the bylaws and governance structures, and what they literally state is that the board of directors are responsible for directing the company. The board is responsible. If you wish to be a director and responsible, then go incorporate, now you are the board! You are responsible! Good luck!
So much of the software industry is just an outrageous combination of inexperience and "YOLO". Every problem can be solved by just giving AWS another $100,000 this month because we don't have time (and don't know how) to make even basically optimized software. So just burn the gas and electricity and give more money to the YAML merchants at Amazon.
I still have PTSD from around 2012 when a company I worked for and loved very much (chumby) imploded financially and almost all of the employees including myself got vacuumed up in an acquihire-type deal into a streaming media company that was building a would-be netflix competitor.
Us former chumby developers were working primarily on the front-end across a variety of embedded-system-like devices (writing code for early versions of 'Smart' TVs from the likes of Vizio, etc) while another team was creating the backend and whenever they would show us the infrastructure diagrams of what they were working on they would just place a "HADOOP Server" wherever they had no idea how they were going to solve some large difficult problem, it was effectively a stand-in for "magic happens here".
Got to the point where there were a hilarious number of layers upon layers of little cylinder icons in the system design titled "HADOOP Server" all interlinked in non-decipherable directed graphs.
I'm pretty sure every single one of us left the new company within 6 months, I lasted about a month and a half.
I'll start to call this mindset the "DOGE mind-virus": "80% of workers are doing absolutely nothing and can be cut with no repercussions whatsoever". Sure buddy.
Well, it worked for Twitter. Lots of people screamed that Twitter would implode withing 6 months, after the massive cuts. There was some scrambling for a while, but I haven't noticed any issues. In fact, they've added tons of new features and Grok AI (which is much better than competitors).
My understanding is that twitter's struggles are/were a result of advertiser and customer boycotts, not site functionality.
People were aghast at the brutality of the layoffs, and ideological direction. However, my impression was that there was in fact a tremendous amount of bloat.
They also removed old features. Or can we look at threads without being logged in? It's clear people who say Twitter didn't change don't remember at all what Twitter was like.
If by worked you mean steadily losing users for the first time in the history of the platform and a 0.2x of the company's valuation, then sure. That worked.
And what's that about Grok AI being better than the competition? I think I misheard.
Running a business is less and less about actual business outcomes and more about juicing stock. And the stock market itself is divorced from reality as companies whose output has gone down over time sees higher valuations because the owner has cult appeal. So everything gets worse and more expensive year over year while feckless suits get sloshed over company dinners.
Can we have a different kind of stock market which forces participants to consider long term outcomes more? E.g. no HFT firm should be able to make a profit from such a stock market. Selling stocks earlier and often should result in a penalty or percentage being taken away as a fee. As a retail investor I would love to use invest and forget strategy based on trends observed in such a stock market.
>forces participants to consider long term outcomes more
I remember many years ago telling a senior executive that I had concerns that some of the steps we were taking to boost current quarter financials would negatively impact business performance in the long term. He just chuckled and said, "there's no such thing as the long term, only a never ending series of current quarters".
>E.g. no HFT firm should be able to make a profit from such a stock market. Selling stocks earlier and often should result in a penalty or percentage being taken away as a fee.
Maybe by "HFT" you only mean "those evil hedge funds that are pushing companies to chase next quarters' earnings", but there's nothing fundamentally wrong with high frequency trading. Market making[1] is high frequency trading, and basically involves offering to both buy and sell and given stock, and pocketing the spread. That increases liquidity, making it easier for other traders to buy/sell stock without taking a huge loss. It's unclear why you'd want to ban this, or how you'd distinguish this from whatever evil HFT you actually want to ban.
I am not saying HFTs can't sell but there should be penalty for higher frequency. It means they have to craft algorithms which will take longer term view of stocks (and their fundamentals) rather than ignorance of other participants
Market makers make fractions of a percent per trade. How will your "penalty for higher frequency" deter traders that prey on "ignorance of other participants" or whatever, but don't put market makers out of business?
All these HFT stuff reminds me of chinese event where people send each other gift money as a good will gesture. Revenue is high but no meaningful transaction has happened. The money is just being exchanged between the same top HFT firms. And the best of our minds are fighting it out in the arena of algorithms rather than creating real world value.
>Revenue is high but no meaningful transaction has happened. The money is just being exchanged between the same top HFT firms. And the best of our minds are fighting it out in the arena of algorithms rather than creating real world value.
Liquidity is "real world value". Being able to buy/sell a stock instantly without a massive premium/discount makes stock ownership for the average person possible. Contrast this to an liquid market, like buying houses, where you need to spend months house hunting, and pay a 6% commission on top.
To return to our initial question: does stock market liquidity deteriorate when HFTs compete? The results suggest that competition among HFTs increases speculative high-frequency trades, which could lead to a deterioration in market liquidity.
Taking the study at face value, it only says that competition among HFT is bad. It also specifically admits that "As market-makers, they can update their price quotes fast when news arrives and provide liquidity to the market. In this case, the low-frequency traders in the market – the investors – benefit from lower transaction costs". In other words, at best it's advocating for some sort of monopoly for HFT, rather than getting rid of HFTs entirely.
It's not really high frequency trading in the sense of day trading, it's a bit of a misnomer. I would say it's actually low latency trading, the number of trades isn't huge. It ensures that linkages in the market operate quickly. Linkages between a stock price and its respective options. Or linkages between an index ETF and its components. The price discovery process should be fast, it benefits all of the market participants.
High-frequency traders (HFTs) are market participants that are characterised by the high speed with which they react to incoming news, the low inventory on their books, and the large number of trades they execute. All this is possible for HFTs because they use automated, algorithmic trading, which enables them to analyse markets and execute trades in under a millisecond. The high-frequency trading industry grew rapidly after it took off in the mid-2000s. Today, high-frequency trading represents about 50% of trading volume in US equity markets. In European equity markets, its share is estimated to be between 24% and 43% of trading volume, and about 58% to 76% of orders.
Benefits how? Even if we are all 'market participants', the time investment between a hobbyist and career investor is rarely equal. An LFT/low frequency trading market would egalise this discrepancy.
This subthread is nonsense. As a retail investor, HFT is good for you and lowers your prices. They have a bad reputation because of the book Flash Boys… but basically nothing in that book was true.
What is the long term effect on accuracy when a large mass simply moves XX% of their monthly paycheck into top ETFs?
I don’t disagree with what you said though, simply sharing thoughts - I think it leads to markets being more sensitive to macro strategies rather than actual fundamentals
>What is the long term effect on accuracy when a large mass simply moves XX% of their monthly paycheck into top ETFs?
Such investments are typically market cap weighted, which means their effect on stock prices are neutral. Moreover there's still room for hedge funds (and other sophisticated) investors to engage in price discovery.
Well people are also betting on themselves in sport betting so if we account for ignoring the rules, I don't see why the qualfiier that betting on yourself is allowed would be needed.
> Companies must invest to train current workers to pick up new tasks — and invest to recruit replacement employees after the economy improves or the company’s financial troubles clear up.
It always baffled me how could a businessman fail to understand that loosing a reliably working employee (even of mediocre productivity) is like shooting your own leg - resulting in having to look for a replacement, train them and hope (certainty is value worth money as well) they are going to be as good. To me it seems it is always better to increase the wage to avoid losing people already working for you so you save yourself from the hassle.
Having lived in the Boise (Idaho) area, I saw this happen over and over with Micron and HP. I knew dozens of people who had worked for one or the other (and sometimes both) and were then let go in those companies frequent mass layoffs. One person I knew had been laid off → rehired by Micron 3x in the span of 10-years.
I think the biggest issue is that it is far too often the _first_ tool that companies reach for, instead of the last. Oh, the market feels unstable? Better cut 5% "just to be safe". There's a national event that might impact our business? We're going to drop 10% of our employees before we know anything.
While it certainly doesn't apply to every company, I wonder what it might look like for executive leadership to make a pledge that it always comes from the top first: The leadership team agrees that it will take a (public) $X financial cut for N months in the event of a layoff-level event/period to help guide the ship through the storm (with compensation on the other side). If it works, you have the loyalty/respect of your employees. If it doesn't, you do the layoffs anyway and those who remain know that you tried.
In Europe where most countries are notoriously hard to fire people they don't do layoffs like that "just to be safe", they instead just cut-back on hiring more people during though times.
It has an impact of morale, but not nearly as bad I imagine. I wonder if that is one of the reasons why Europe companies tend to be smaller companies, while US tend to be bigger. Expansion is easier when you can fire at any time, smaller companies are more likely to succeed if they don't over-hire and keep talent around.
I don't know whether it's a reason for size ("one market" isn't just about taxes, it's also about culture and language, and that's more different in the EU than the US), but it definitely makes companies more risk-averse towards expansion and disadvantages people with non-average backgrounds. The risk your CV suggests (e.g. mental health, unemployment, non-traditional career) gets multiplied if it's close to impossible to fire you.
"Kelleher wasn’t around to see them. He died in 2019."
That's how it works. You have someone who is a great leader who started a company and treated their employees well, then the behemoth corporation waits for them to die to start gutting their values. It happened at my company. It's basically just a lite version of a private equity takeover.
The layoffs are not the issue. It is the decision makers who took the two decisions to both over-hire and then mass-fire shortly after. GM is a great example. The company was the largest and one of the most innovative car manufacturers in the world. It doesn't stand a chance against BYD today and it is not by a lack of money (though maybe with a C-suite change).
So my opinion is, yes, the damage is done (or being done) but like GM, it'll probably take 10-15 years until we are in the visible territory. Maybe a bit shorter because this is tech.
GM is a great example, Intel as well, that its rarely the engineers fault. You can have great talent but if management is dead set on bad decisions over & over, theres nothing to be done.
And the decision to overhire/overfire, set bad strategy, etc all resides in the C-Suite who rarely fire each other or themselves when it all goes wrong. It's only the employees that suffer for every mis-step.
This hits home. I wish there was a way to gauge “retrospect” before actually suffering from it. I’m now usually quite weary of “we’ve had to get yet another loan of 60 mil, after 6 years in business because we don’t know how to make a profitable business” also known as a series C or whatever.
I don't work full-time for startups, because of this. I was contracting for a startup last summer for about 6 months. They paid really well, but after researching the company, they were on their 3rd round of funding. The estimated yearly profits were a sliver of this, meaning they were burning through VC money hoping for an acquisition or somehow massively increasing profits. The product was also in a very crowded space with lots of competitors.
They had 3 other contractors working on the same functionality and they were all let go within a couple of weeks, because I could get it done 2X faster and without many integration issues.
I would have gladly kept working as a contractor, but when I refused a full-time work offer, they cut all contact off with me.
I would talk to the FTE frequently and they were always overworked and on multiple teams.
> one of the most innovative car manufacturers in the world
Off topic, but I'd like some more specific thoughts regarding what you are aware of for specific automotive technologies that GM has innovated over the past decades, to make this statement.
Intuitively, GM cars do not do well internationally, have been known to have creaky interior build quality, have silly features like turning the reverse lights on when you unlock the car in a parking lot, and are not competitive on a scale of luxury compared to their European and Japanese counterparts.
I agree with you that most American cars are junk. I hate all these same features plus others like the weird headlight controls, parking break on the floor in non-trucks, not to mention the loose feeling brakes and steering.
Traditionally, GM sold other models overseas through brands like Holden or Opel, but these have all been sold off or shut down over the past decade or so except in China. GM now has a much heavier reliance on trucks and SUVs in the North American market. They sell some of those same product overseas still, but in much smaller quantities than before.
I feel that companies just repeat discredited strategies because they are conventional wisdom, and no amount of explaining why layoffs don't make sense will stop them from laying off.
It's mostly about conformity. They heard that all the serious companies are laying off. So they've got to lay off too. Can't be seen breaking convention.
With big tech, a few years back when over-hiring was the conventional wisdom they were for that too.
The more fundamental question is: If mass layoffs are so necessary, then who’s responsible for the unnecessary mass hiring? In any mass layoff, fire that person first. Get to the root of the problem.
The article doesn't actually explain why. It claims that they don't work and supplies statistical evidence. But why don't they work? I've only really seen speculation...
Atleast 2 of the fast growing companies I have been a part of have had serious layoffs that were very successful in cutting dead weight that had accumulated because of fast and loose hiring and poor middle management. So it can be done well.
By and large though they are a sign to jump from the soon to be sinking ship... so it's very important to know what kind it is and act accordingly.
"After the early-2000s dotcom bust, Bain researchers found that stock prices for S&P 500 companies that had no layoffs or laid off less than 3% of their workforce increased an average of 9% in the next year."
Do non-science journalists just not know about correlation vs causation? Does it really not occur to them that maybe the companies that didn't do layoffs were healthier and that's why they overperformed? Wouldn't a 10 year old know that?
One big problem is layoffs cluster around events like the dot com bubble, the financial crisis, or covid, so there are weird things happening. You might be able to look at companies' quarterly profits to identify healthy companies that remained healthy, but still did layoffs.
I was being hyperbolic about the ten year olds, but that's funny.
Correcting for it: I don't know. It would be very hard. You could try to control for variables like profitability, etc., but there are so many and you don't know what you don't know. But the correct response to absence of valid data isn't drawing conclusions from obviously bad data.
It just cracks me up that one paragraph later the author points out:
"Mass layoffs are often symptoms of unsound business strategies and don’t do anything to cure the larger problem."
and yet somehow didn't see that that sentence alone proves his previous one was pointless.
I find it fascinating that every single post on this godforsaken orange website inevitably has several comments that amount to "nuh uh!", and then they trot out the same three or four reasons why, this one being one of them.
Because it's a very common logical fallacy. You're also describing sample bias, someone who wholeheartedly agrees with the article probably has little to discuss.
Unfortunate click bait title for such an important topic. The various metrics quoted of why companies without layoffs appear to do better do not address the idea of underlying causes such as companies doing better do need mass layoffs while companies not doing as well likely to reduce expenses with actions to include layoffs.
Layoffs are a blunt instrument. I don’t know if al layoffs should be seen through the same lens. I see layoffs as signals from the companies. They see the future as unsure and so they want to reduce costs. That should be an immediate layoff for the ceo and his team
The tech layoffs are the results of couple of years of exuberance that happened right after 2020. Companies are laying off and we are getting back to trendline. Nothing to see here.
This blog post is wrong, it also just doesn't matter in practice. Nobody who is making this sort of decision is going to give this kind of obviously false argument a second thought. When you're the one that actually has to make decisions that matter you're going to be better at ignoring bullshit. The audience for this is just people wanting something to upvote that sounds good to them - driven by motivated reasoning.
> “You could blame the workforce,” he says, “or the managers and leaders who are leading that workforce.”
They often do fire large swaths of middle managers - when Musk bought Twitter cutting out the middle of the hierarchy and the orgs that didn't need to exist was a big part of it. It's the same with DOGE. After the twitter layoffs they've shipped more features, faster, with better margins (and he fired the CEO). Meta and Coinbase over hired during the covid 'zero interest rate phenomena' and had to fix it. Reducing hours instead is a joke - I find it hard to believe anyone being honest takes that seriously.
Because layoffs are not done to make company great but to make sure shareholders and execs preserve their wealth. It's never about company or people or technology - it's always about money, power and wealth.
There is a theory about large complex systems which seems to be true in biology and maybe applies here. Intentional downsizing during times of stress works when it preferentially targets defective or dysfunctional components of the larger system. The system improves because the worst parts were removed.
Layoffs don't help companies unless they can reliably remove the worst parts. At most large public companies, the cancerous bureaucracy protects itself and the parts removed are closer to median performers, or even above-median performers. The system gets smaller and less efficient.
Layoffs can be necessary to get the company to fit through a certain sized hole (in the form of cash flow constraints), but it won't be better at what it does on the other side of the hole, it will just continue to exist.
Layoffs work when there is an accurate discriminating mechanism for who stays and goes. The best example of this (outside of private equity turn-arounds that are not widely known) is Twitter. Outside engineering talent was brought in as an oracle, immune to Twitter's bureaucracy. It reliably discriminated between value-adding and not. As a result, the company became incredibly lean and even consistently profitable.
Large tech companies are inefficient and have very poor engineering productivity but this is largely for systemic reasons. They definitely do not have any mechanism for identifying high performers.
The basic problem they face is that they pay a fixed wage for complete IP ownership (horrible deal) and so they intentionally do not measure and reward actual performance because they do not want to compensate high performers based on the value they create.
There isn't really a solution because these companies are making rational profit maximizing decisions, it just happens that mediocrity and managed decline of locked in revenue streams is profit maximizing for them.
> they intentionally do not measure and reward actual performance because they do not want to compensate high performers based on the value they create.
Ten years ago, an oft-repeated quote: “you’re not paid what you’re worth, but for the value you create.”
In light of that, is the argument that performance is institutionally obscured so that devs don’t realize how much leverage they really have? I can see traces of that in seeing shipped products as less the result of one/few devs working hard and more as multiple teams, as you now have two levels of personnel abstraction to diffuse potential leverage (individual/their team, and the teams among themselves).
Could I be missing something, but are you seriously promoting layoffs? You must be trolling by using twitter as functional example of why they work? I think sometimes I miss sarcastic tones and I really hope i did with this one
lmaoooooo buddy "oracle" implies they know something; the people brought in to fire people at Twitter spent almost no time in determining who was good or even how the company worked, completely undermining your thesis. It was madness: people were instructed to print paper copies of their code to bring into an office, like it was 1995. Remember geohot in a Spaces saying "the main problem with Twitter is that you can't run it locally?", as if any company of that size has run that way at any point in the last decade? Additionally, the horrible communication and chaos made it even harder for performers to perform. As others have pointed out, its stock lost a ton of value, it performs worse financially, and as a product by virtually every other metric has gone to hell (outages, CSAM safety, spam, bots...).
You tell a decent story at the start, but your choice of example couldn't be worse.
By the late 1960s, software projects had finally reached a certain size, and the particularities of managing these large projects were discussed at NATO software engineering conferences, and codified by Fred Brooks in 1975 in the Mythical Man Month. The upshot being, software projects at corporations can't be run in the same manner as non-software projects. Yet at Fortune 500 companies today, and in the past two years that includes at least some of the FAANGs, you see them trying to run software projects and treating programmers in the same manner they treat non-programmers, and it doesn't work.
I just happened to watch some old talk or interview with Gabe Newell recently, and he said industry thinking at the time Valve was founded was of a certain kind, and Valve took the opposite approach from the industry - the industry was looking to get cheaper programmers, and Valve went the other way and looked for the most expensive programmers, and so forth. Valve has probably less than 400 people working there (don't know the 2025 headcount), but makes billions a year in profit.
Outside engineering is not ever an oracle, and it has its own interior motives and bureaucracy, firing people is generally a one way street.
Twitter has literally issued authoritarian threats to advertisers to come on its platform or else because of how much its valuation has dropped and how much money has been lost - this is the worst example of "engineering oracle fixing things" I could possibly imagine.
I don't have that much of an experience analysing similar reports, but it seems to me to be a healthy and growing company?
If you mean a negative cash flow and operating income - it doesn't mean much, as we need to know why.
Taking into account the jump in "Revenue", positive "EBIT" and so on, I would imagine that it was because of some sort of "strategic investment", like some acquisitions probably?
What am I missing? I would definitely be happy with such reports if that was my company.
Unless I'm missing something, your data you've voted seems to be pre-acquisition.
Also, by all accounts their revenue has dropped so much they're having issues even covering the loan payments, much less having enough for any semblance of profit.
A couple weeks ago Google announced more layoffs in their HR and cloud divisions. They have $100 billion cash on hand, literally more than any other tech company, and much more in longer term investments.
In round numbers, that's enough money to cover roughly 10,000 employees for 25 to 50 years (depending on how much you think the salary averages out to).
Regardless, the CFO said one of her priorities this year was more cost cutting.
The CEO who "cuts" people at a company is like the Aztec priest who plunges the knife in atop the pyramid. The bloody spectacle is the point. It's as much about everyone who's watching as it is about the specific victim. It says, "I can do this to you. I can inflict pain without reprisal. Behold my power."
That's the whole point. Who is afraid of whom?
These people have the money. We depend on that money in order to live. They are reminding us of that fact. Now they demand obedience and harder work. 40 hours? Not enough. Elon sleeps at the office, why don't you? You have to be "super hardcore".
Partly, this is punishment for the challenge that was raised to CEO power from around 2016 to 2022. CEOs have been furious that they have felt fear of their workers. Now they want those workers to feel fear. In interviews, Andreesen has said almost exactly this, if not in quite so many words.
A similar theory is at the root of Fed policy, which hinges on the idea of a "wage price spiral". In their view, inflation is caused not by the accumulation of capital within a price-insensitive upper quantile, or by the constriction of economic chokepoints by consolidation, but by workers' ability to bargain for higher wages. The solution to inflation, they essentially come out and say, is to put workers in their place.
There is a united front here. It is about who fears whom, the end. It is about your emotional state. In a literal sense, it is terrorism.
So in that sense, yes, layoffs work. Are you financially independent? No? Are you afraid? Yes? Then they're working.
I wish those departments tasked with busywork would be able to build skunkworks inside these dysfunctional molochs and be able to keep what they create. Fired into becoming a startup.. a man can dream.
I've been through several layoffs, on both sides of the coin. The one consistent factor I've seen is managerial incompetence. Management will fail to provide any leadership or guidance to employees, then blame them for not being productive enough. They can't see their own incompetence, so they blame hiring practices and keep ratcheting up interview difficulty. It's like corporate America has evolved to protect the ego of the managerial class.
Don't work to do what? If you think layoffs are about efficiency or saving the company, at least in tech you couldn't be more wrong. Companies like Meta and Google have done multiple rounds of layoffs despite being insanely profitable and never taking a loss.
The real purpose of layoffs is to get people to do more work for the same or less money (by firing people and distributing their responsibilities to those who remain) and to suppress wages because nobody is asking for raises when they fear for their jobs.
Big Tech is really out of ways to grow their business. The only way they can keep growing profits is by cutting costs and the biggest cost is labor. It's really that simple.
The other question is why C-suite does even need to tell the respective division management to lay off employees if the actual goal is cost reduction. Shouldn't they impose a budget reduction target instead and trust them to allocate the savings between capex, opex and salary budget according to specific situation at hand?
>> why C-suite does even need to tell the respective division management to lay off employees if the actual goal is cost reduction
You answered your own question. For a lot of layoffs, cost reduction isn't the goal; it's disciplining the workforce who were increasingly assertive at work about direction and conditions.
For many companies the largest cost is labor. Also in many companies, managers amass power by the number of people they manage. If the C-suite doesn't explicitly push for layoffs they will likely not happen, causing them to not reduce costs as quickly as they wanted.
Nah I've been in meetings before where it was asked "if we can find these ten million in cloud costs and licenses, can we retain staff?" and the answer was "no, because those are different buckets."
Regarding "managers try to amass staff," I've seen some of that for sure, but it's not universal and acting like it's some kind of iron rule of organizations is an op.
Most managers are evaluated based on the impact their organization is having, not the size of it, unless the firm is incredibly poorly run.
What does happen, and where these layoff edicts come from, is that the executives fear the management is more loyal to their directs than they are to leadership. They feel that if they want to inflict something on the workforce they have to "force" management's hand, because otherwise management will resist.
Combine that with temporarily-embarrassed billionaires and it's a recipe for disaster. Every last asshole here is hoping for a fat exit for some ReactJS garbage that probably just grinds up poor people into McDonald's hamburger meat; of course they don't give a shit about actual workers with actual lives, whom layoffs predominantly hurt.
I've been laid off, eight months after a hiring blitz for the exact division I worked for. Now, I could've told them the acquisitions they did were stupid and that the products were never going to be profitable, but I don't live in Manhattan, so those decisions are above me. But that didn't stop them from juicing the stock price and ruining our lives anyway.
Fuck these companies. They could do better, and they choose not to. And every last sycophant here is complicit.
Layoff are like hammers: When needed, in the hands of someone skilled, they work perfectly well. But such situations are sadly rare, compared to frustrated idiots grabbing hammers to get their quick "Hulk Smash!" dopamine hits.
When it is your money making payroll, than the perspectives rapidly shift.
If your Labor doesn't tangibly produce quantifiable profit, than you must furlough staff to stay in business. Assigning fault in such situations is a fools errand, as everyone suffers losses in the end ($18k to $45k in lost training resources per person etc.)
"Companies who enact them as part of a broader change in strategy, Cascio says, fare better than those who enact them simply to cut costs."
Ah, the old strategic realignment PR BS. "Its not cost cutting because our C levels are clowns and screwed up. Its a strategic realignment for AI investment ". Lol. Didn't Salesfarce and Fakebook both use that one?
When will AI replace upper management? It can't do any worse.
> There are findings that suggest layoffs lead to both short-term and long term issues, including:
> - A 2x as likely chance of bankruptcy compared to companies that haven’t done layoffs.
Obviously! Because a huge number of the companies undergoing layoffs are about to go under and are using layoffs as a last ditch survival effort.
The author may be right, but every fact and figure presented in this article fails to distinguish between healthy companies in healthy industries using layoffs as a lever to increase stock prices, and layoffs happening in industries/companies that are collapsing.
The article lists down why layoffs don't work, but companies keep doing it, so it must be working for them.
I hate layoffs (from both perspectives), but the article sounds like whining "we shouldn't break up".
The alternative of furlough only works if everyone else is doing it. If everyone else fires left right and center, the people being furloughed will still have low morale.
I think it's better to avoid it in the first place, by not over hiring, as others have pointed out.
I think you’re right that it’s better to avoid these issues in the first place, but your perspective on furloughs instead of layoffs seems a bit fatalistic. I think a company that did rolling furloughs (and importantly was transparent about the whole process) would probably maintain pretty good morale, especially if the rest of the industry is laying people off. But yeah singling people out for furlough would probably be a big morale hit
Real talk here, and I'm sorry for being "that guy"
Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping? I know multiple people who have worked their entire career thus far without ever staying at a place for more than 3 or 4 years. Some no more than two. Tech job culture is practically a mono culture with "hop jobs" being a hallmark.
From an employers perspective it's not laying off a bunch of family members (Southwest has an average tenure of 11.5 years), it's laying off a bunch of people who were gonna dip in 6 months to a year anyway.
I know this is controversial take, but recognize that the tech industry is an outlier industry, with outlier amounts of money and outlier amounts of volatility.
I cannot speak for layoffs in all industries ever, but I agree with your assessment of layoffs in big tech from personal experiences.
I have way too many “lifer” friends in big tech who are deadly scared of layoffs and job hopping. They are also the ones who rarely got promoted and havent had a significant pay bump pretty much ever.
On another hand, half my team at a big tech company got laid off back at the start of 2023. 4 months later, I caught up with them over drinks, and the results were rather interesting. They all got around 4-6mo worth of severance pay, spent 2-3 months just skiing/traveling/hiking/vacationing, then 1 month or so interviewing, and then starting their new jobs shortly after. All seemed rather happy, both with their new positions/pay (which had a significant paybump) and, essentially, paid vacation break they took right before.
It seems like the heavity majority of those stressed about layoffs in big tech are lifers and those who are chronically averse to and dread the interview process.
Yeah, I make the same adjusted for inflation that I did when I got my last/only promotion 10 years ago. I have grey hair, a disability, and a family that relies on the health insurance. Switching or being laid off is a risky proposition for me. It sounds like all your examples are young, childless people (who else could take a month off to go vacationing?). Life is much harder for some of us.
Yeah, the prospect of layoffs hits a little different when you're in your 50s. I have some non-techie friends in their 50s (sales, project management) who have been looking for a job for years. I've even heard third-hand about some good programmers in their 50s in the same boat, although I don't know them personally.
The last time I was looking for a job at age 48, I interviewed at a bunch of startups and only got a second interview from one. It was clear that most of them were never going with someone my age unless I'd written a book or had patents or something (or was ex-FAANG), even if they didn't consciously realize that.
Yep. The subliminal message I'm getting from my current managers is that I should just be a good little disabled person and work as a Walmart greeter. It's turning into harassment at this point. Just all sorts of BS. Like telling me they are doing so much for me, when my ADA accommodation is weekly 1-on-1s with the manager and my tech lead. Is that really a lot? There are people without disabilities getting weekly 1-on-1s with their managers. Maybe the weekly tech lead meeting is more than others get, but it doesn't seem that hard. I got told my productivity looked bad. I asked if he ran the numbers - he didn't. He didn't even look at my productivity before telling me it looked bad. I ran the numbers and I was in line with my peers. I would think that's the definition of bias... nobody gives a fuck. I didn't get my accommodation for 6 months last year and then they gave me a bad rating based on opinon and not metrics. They said me not getting the accommodations wasn't a factor in my performance (how?).
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No sympathy from me either; instead, he gets appreciation. Thank you, OP, for bringing more life into the world. It's hard and (obviously) frequently thankless.
Thanks, but I'm not sure this deserves appreciation either. We already have plenty of life in this world. Perhaps so much so that the human life is negatively impacting other life, including other humans. I'd be much more appreciative of people making life better than making more of it.
The new generations of drones, still being tested, are fantastic at hunting down anything with a pulse. It is a really exciting time to be in robotics and CV. I am no longer concerned about overpopulation.
Goodness what a miserable outlook
Just look at history then
That's a pretty weird and heartless thing to say. Having children is not a vice that deserves to be judged anymore than not having kids is. I could enumerate why fewer kids is bad for our collective future as a whole, but I won't, because the decision to have kids is a personal choice.
Also, having kids is generally not the difference between having to work or not—most people have to work for a living regardless of family status. It's just that the stakes are higher when you have dependents.
You can view what I wrote whatever way you want, but I stand by it and don't think it was heartless at all. I think not having children is actually more heartful and caring than having children.
Look, out of all the people who come into this world, how many people can we say were a net positive for this planet? I see that you are currently at Airbnb. Great. You are lining your pockets, but I'm not sure what the net benefit to this planet is. If I have children, the chances are great that they were just resource consumers and waste producers. There are too many people on this planet, and chances are my having kids will make this problem worse. Of course, on a local scale, your children will add love to your life, you will help them out financially, they will live at home with their parents as adults, etc. This is not being selfless. You are helping your progeny which is, ultimately, selfish. What is truly selfless is to meaningfully help someone who has no connection to you. Fight for the poor, support countries that are being terrorized by aggressor countries, adopt a shelter animal, etc. That is truly selfless. Having kids--selfish. Look at Elon Musk and his 10+ kids.
> the decision to have kids is a personal choice.
And I choose not to burden the world with my own children. I've had numerous exchange students, adopted shelter animals, and I'm volunteering at a local shelter. I'm not under any illusion that my life here is going to be a net positive for the planet, but I am trying really hard. Having children, with the traditional notions about it that you regurgitated, is a vice when you consider that we are reaching our planet's capacity for supporting all of us. Ruining other planets such as Mars, I don't feel is a morally acceptable choice.
So you don't think people should have kids, that's a fair viewpoint, I don't begrudge you that.
But you responded to a thread where someone was expressing the considerations they have about why being laid off is personally scary to them. Using that to grind your axe about whichever of their life choices you find morally dubious is the heartless part.
It's not really surprising though since your first reaction to my comment was to look at my profile and cherry-pick something to condemn me with.
I didn't ask for your sympathy. I'm merely responding to someone who doesn't understand that others have factors that affect how hard it is to change jobs.
On a side note, I'm getting whiplash by how fast we go from
FWIW: https://www.usaforunfpa.org/are-we-overpopulated-are-birth-r...
I think a lot of the "low-birthrate" fearmongering is just a way to distract people.
Overpopulation was projected to be an issue, but we actually addressed it pretty well over the last 50-75 years and global average birth rates are in a pretty good place now.
I'm curious how you'll feel about this comment in 10 and 20 years from now.
Hard to say. Perhaps Boston Dynamics, or Canada will have a solution to their problem.
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Haha you must be young. It's entirely possible young people will make the same choices and face the same realities I currently do. They just havent gotten to that stage yet. Even comparing my life now to my life 10 years ago would show the younger me had an easier life. However, having a disability is not a choice, and in general makes life harder than those without a disability. Don't get me wrong - I believe life is hard for almost everyone at at least one point or another in unique ways and to varying degrees.
Actually, I am not young. I just retired and have been thinking about my life, career, etc. I do not have a disability (my wife may disagree) and I agree it makes life more challenging (wouldn’t be called a disability otherwise). I also agree with you that life can be hard, children are born with health challenges, children make poor decisions with terrible consequences, spouse dies, you get cancer, etc. We all need to get through these. That does not change the fact that we all have decisions to make everyday about our careers, our families, our health, our financial situation, and so on. When we look at those who made different decisions, it does not necessarily mean they made better or worse decisions, just different decisions.
I have been thinking about this a lot recently. A former boss and good friend who is incredibly smart and effective in the work place asked why the two of us had never gone the PE route and been more successful. While he is very successful by most standards, he sees people flying private jets all the time who do not appear more skillful, yet have been more successful. As I think on this, I feel I simply was never willing to go all in on the risk required to achieve that level of financial success. I tried co-founding a company once when I was 28 while engaged and importantly, before children. I felt I could take the risk and if I failed, could bounce back. I did fail - company did ok but my I ended up disliking working with my senior partner - and I did bounce back, ending up at GE.
After that, I did not feel comfortable taking that level of risk until my children were off to college and no longer dependent on me an I had enough money saved that my wife and I would be ok for a long time. The people I know who have been jet-money financially successful took huge risks. They were all in on their venture(s). Frequently this cost them their marriage and/or relationships with the children. This was their choice. Their cost/benefit analysis to optimize their success criteria. Some regret the decisions - they underestimated the effort and impact on those they cared about. However, most have not. They are happy with how things have turned out.
Different strokes for different folks.
The other factor you are missing in your analysis of PE route is the number of musical chairs are limited. There can only be 1 taylor swift not millions. So the choice is not for everyone. Even if everyone made that choice, a million taylor swifts will not happen. Surviorship bias is real.
Your good health is an invisible crown that can only be seen by those who do not wear it.
What a great saying. I feel this in my very core.
Dealing with poverty in my youth, homeless at 16, no parents to help me, debilitating ADHD, tourettic OCD, bipolar type II, CPTSD from 10 years of intense childhood physical/emotional abuse, my full-ride college scholarships illegally stolen from me by a high school who knew I was homeless and had no recourse and allowed a teacher to illegally modify my grades out of pure spite, malnourished, intense, crippling sciatica, fused lumbar discs, possible fibromyalgia, and then developing excruciating daily pains and physical disability which greatly impacted my life and sometimes made me suicidal, which turned out to be an autoimmune disorder that took 10 years for doctors to figure out... an extremely intense case of gout developing since my teens...
I just keep pushing on but every day I see people who take so much for granted, and who are so ready to pass judgement without appreciating the basic privilege of good health.
I've had to deal with so much struggle that the average person wouldn't even want to take the time to hear all of it much less believe it, once someone momentarily realizes that they'd have it comparatively easy compared to others, they often get defensive as they begin to realize that their life doesn't have nearly as many barriers as they've convinced themselves, and they have to come to terms with not applying themselves harder. It's easier for them to be dismissive and tell me, "all your problems would go away if you worked out more" or tell me to get on a keto diet, or whatever have you, as if I haven't tried every single thing I can think of.
And the insane thing is I am still quite privileged compared to some people in war-torn countries, even if they are able to move around without swallowing a truckload of ibuprofen. Reminding myself of that is a source of strength and determination to keep moving forward.
“You never know what worse luck your bad luck has saved you from.” ― Cormac McCarthy, No Country for Old Men
How do you know I have good health? What an incredibly smug comment meant to silence someone with no basis in fact.
Well, the person you originally replied to mentioned having a disability, and your response was "yeah but you have kids so really you chose this and also I disagree that life is harder for some people."
The generous interpretation would be that you have sufficiently good health that you do not have to structure your life around it, and therefore lack understanding of the challenges faced by those who do.
The alternate interpretation, that you do understand and choose to ignore and dismiss, would be rather less generous to you.
Wisdom speaks. Hidden gem of this thread.
your argument sounds like "some people choose to do the dishes, some of us choose to let other people do the dishes".
Some of the "free choices" you claim people can make, will only be possible if some other people don't make those same choices.
People don't chose the abilities or disabilities they're born with, nor those they receive at the hands of others.
Many also don't have the choice to start a family, no matter how badly they want it.
Not passing any judgements on any life choices here, but occasional months off sounds like a good thing. I would not necessarily need to go anywhere to enjoy (make use of) the time. The notion of getting a month off with pay sounds good.
That sounds good, so long as there is similar employment at the end of it. As a sabbatical it sounds great. As a layoff, the uncertainty sounds crushing. It could take months to find a new position, especially with the disadvantages I have, I would likely need to start looking immediately and wouldn't be able to enjoy it.
Yeah, it's the same problem I have when the 20 somethings use the term "funemployment".
If you're single and have no responsibilities, sure. The second you have a mortgage, medical conditions that need health insurance, or need money because you had a family emergency and had to dip into savings, it's not "funemployment" at all.
Sure, maybe that's how people in their 30s living in NYC or bay area feel about layoffs. But when you're older, have a family, and live in an area with a less dynamic job market, you may see things differently.
Why does it have to be an age thing? Some men and women are players and the game is the game to them. Those who are naturally monogamous would be stressed in a game like that. Constantly uprooting is a stressful lifestyle and can truly be torture (as evidenced by constant anxiety, no way to be). I can promise you people who are job hopping are hopping around other things in life (friends, family, relationships, projects, interests, roles, identities). It's a whole way of being.
Edit: This is not a judgement, but if you felt like it was, I very much want to hear about it.
> Why does it have to be an age thing? Some men and women are players and the game is the game to them.
Yes, buuut many will be players from 25 to 35 (with some degree of flexibility), that's why it's still an age thing. Yes, there are persons that are players for life, sure. But IME they are a minority.
Or maybe I'm just projecting, who knows?
Big tech interviews tend to be daunting. Many long term employees lose the skill, and fear the impact of work interruption on their resume as well as their ability to get in again.
Anecdotally, the LC bar for many firms has risen to the point that passing requires at least one through of the question before. If you Time bound your practice per question to 20 minutes, this means that you can solve most LC problems at least once in around 8 weeks of 40 hour weeks. Or 6 weeks at 60 hours.
Not a pleasant way to spend two months - but not impractical. I'm unclear what employers are deriving from this exercise at this point.
> I'm unclear what employers are deriving from this exercise at this point
It filters out the complete frauds.
Yes, there are people who know all the right things to say in a job interview, but cannot code at all. If you hire one of them, it takes a bit to find out they cannot code, and a bit longer to fire them, so you're out $$$$ paying their salaries for nothing.
For example, a recruiter I know will ask a tech candidate "what is 20% of 20,000?" A significant percentage cannot answer the question. Some even cry. It's shocking.
A friend of mine was looking at getting a FAANG job. He was worried about the leetcode tests. I suggested he spend a month going through the leetcode books studying them - that the return on his time investment doing that will be one of the best ROIs he's ever done. He did, and got the job. (Although the LC was just a first gate one had to go through to get to the real job interview.)
Personally, I have no idea how I'd do on an LC test without prep. But I don't have a problem with studying it to get a top job.
> it takes a bit to find out they cannot code, and a bit longer to fire them, so you're out $$$$ paying their salaries for nothing
Not just that. They block the hiring process. Maybe there was just that one open position on your team, and that bad 3 month hire postponed a good hire by 6 months. It's also very incomfortable to fire and start again.
My interviews contain questions that are basic, and any new team mate should know. I keep asking them because 90% of the candidates actually can't answer them well. You should know what a "dot product" is if you want to work as a ML engineer, that kind of stuff. Or be able to open a text file and count word frequencies.
True words. It's not 'imposter syndrome' if one comes across as an imposter (though it might have been just be a bad day).
I can appreciate the gating process because it's a real drag to get hired and then spend more time than necessary not doing my work but trying to help coworkers catch up on very basic and fundamental skills in order to be able to collaborate with them.
> For example, a recruiter I know will ask a tech candidate "what is 20% of 20,000?" A significant percentage cannot answer the question. Some even cry. It's shocking.
During our interview, we ask candidates to design a history system. The key is to realize that our database is only 8Gb, and storing a year of updates is only 160Gb, so $2pm in AWS. Once there, a simple DB table suits, no need to set up Amazon S3.
So we ask them for the multiplication. First we give them the data, and if they don’t do the calculation, we nudge them, then we ask them, then we write the multipliers for them, then we take the calculator out and write the result for them.
Those are Masters degrees. They can’t even do calculations, let alone getting it right, because 500MB x 200 days a year = a few petabytes apparently. And after that, they’re exhausted, it’s impossible to ask them the rest of the questions like “So is it worth worrying about a Rube Goldberg machine when you’re in for $2 of AWS costs?”.
Does your interview process require knowing cloud costs off the top of your head? Because that's hard to track tbh
Sounds like it requires knowing them to an order of magnitude or so... Which honestly sounds like a pretty good bar to have your team above?
What the… no.
I get that perhaps you were using the proverbial "I" in your last sentence as an example of something everyone should be willing to do in/for their career, but does someone of your stature even need a real interview, much less a LC test, to obtain a top job? It's kind of funny imagining a young tech bro interviewing you, tbh.
It's an interesting question. I'll try to answer.
I generally do not use clever algorithms in my code. I just use straightforward ones. Rarely, I might need a better one and go looking for it (like a better hash algorithm). I rarely use a data structure more complicated than an array, list, binary tree, hash, or single inheritance.
What I have, though, is decades of experience with what works and what doesn't work. (My favorite whipping boy is macros. Macros look like they are great productivity boosters. It takes about 10 years to realize that macros are a never-ending source of confusion, they just confuse and obfuscate every code base that uses them. I could go on about this! ...)
I have become pretty good at writing modules that minimize dependencies, and pretty good at the user interface design of a language.
But still, if the job wanted a leetcode test, I'd take it, no problem. I'd study up first, though.
If a young tech bro was interviewing me, I'd suggest he show me his best code, and I'd do a review of it :-) The point of that would not be to humilate him, but to demonstrate the value I can bring to improving code quality.
If I was being interviewed for a job writing a faster divide routine (the ones I wrote were shift-subtract, slower but bulletproof), a better random number generator, a cryptographically secure hash function, a tighter compression algorithm, a faster sort, I'm not the right guy for that.
P.S. I was once asked to review the code of a famous programmer I won't name. I was shocked to discover that the large codebase had 3 different implementations of bubblesort in it. I replaced them all with a call to qsort(). He asked me how I managed to speed it up :-/
We all have our blind spots. I do, too.
My favorite blind spot is how our definitions of quality change over time. I knew someone who had a mature codebase which a new developer made substantially faster by removing his old optimizations. He’d measured very real improvements back when he made that hand-rolled assembly code on early Pentium generations but by the time we revisited it less than a decade later the combination of compiler and processor improvements meant that the C reference implementation was always faster. (I was assisting with the port to PowerPC and at first we thought that it was just XLC being especially good there, but then we tested it on x86 with GCC and found the same result)
Beyond the obvious lesson about experience and sunk costs it was also a great lesson about how much time you assume you have for maintenance: when he’d first written that code as a grad student he’d been obsessed with performance since that was a bottleneck for getting his papers out but as his career progressed he spent time on other things, and since it wasn’t broken he hadn’t really revisited it because he “knew” where it was slow. Over time the computer costs eventually outweighed that original savings.
Thanks for that very interesting and insightful feedback!
I have done probably 500 to 1000 tech screens for big tech companies (as the interviewer) and this is completely true.
I have interviewed many people employed in tech as programmers for their entire career and they can't code. I don't meen leetcode, I mean they get confused trying to write brute force substring search. The nested for loop seems to be too complex for them to keep in their head all at once.
I have had numerous people cry. Again this was a screen, not leetcode. I'm asking them to check if text has mismatched parens, or find a substring. Things you do for homework in your 2nd programming class freshman year. Things every competent programmer can do while chitchatting about the job.
I would estimate that more than 10% of screens are like this, again these are employed people in the industry for years, sometimes tens of years.
Edit: I understand that people can get flustered, I understand that some people have trouble under pressure or while being observed. That's why I pointed out multiple times that the problems I gave are extremely, EXTREMELY easy. I'm basically asking them to write down their name and they sit and look at the pen like they've never seen one before. If you can't write a 5 line function to find whether a substring occurs in a larger string when given 45 minutes, your choice of programming language, and as many attempts as you need to debug and try again you simply will not be able to do any useful work as a programmer. If you don't know that to match parens you need to use a stack (or at least that it's one way to do it) you either have a very poor memory or no training in computer science at all - either of which is frankly disqualifying. Anyone borderline competent would invent a stack when presented with this problem if they hadn't already been told this fact a dozen times during their education or even light reading about algorithms.
> I have interviewed many people employed in tech as programmers for their entire career and they can't code.
Think about this contradictory statement for a while. Can it actually be true? Or is there something else going on?
If the interviewee has nothing but sub-1yr stints on their resume, perpetually getting fired before vesting at any company, then yes, it's very possible they actually can't code and just fake it at every interview.
But everyone else... if they have spent years at tech companies writing production code then obviously they know how to code. They might be great or maybe mediocre, but guaranteed they at least know how to code.
So, if your interviewing technique is concluding something that is obviously impossible, then start by considering how to improve the interview technique.
I’m an electrical engineer who does circuit design. I’ve interviewed many electrical engineers over the years and the situation of applicants having “years” of experience while simultaneously not knowing how to design a single circuit is real. In our field it’s usually because although the person’s title is engineer, in practice, they don’t do any engineering. There’s just a ton of peripheral work (basically paperwork related to operations and compliance), which is very important, but is not design.
My guess is computer science has a similar issue.
Lots of people with programming in thier job title but they don’t actually program. And based on ltbarcly3’s empirical measurement, “lots” is above 10%. ;)
I know a lot of people who can tweak code that already exists. However, if they are sitting in front of an empty text editor and given a goal, they don’t know how to break the problem down and build a solution with the tools the language gives them.
In a large environment, someone may rarely need to start from nothing, so the interview format throws them.
That said, I think being able to break down a problem to solve it with code is a really important skill. Without it, the person will always have to lean on others to fill that skill gap.
> I know a lot of people who can tweak code that already exists. However, if they are sitting in front of an empty text editor and given a goal, they don’t know how to break the problem down and build a solution with the tools the language gives them.
But being able to break things down and come up with a solution is not necessarily something that needs to be done quickly, in the time you have for an interview. Quite often I've been faced with a new problem and done absolutely nothing visible for ages. Literally just reading around the problem, asking questions, and sketching in my mind without writing a single line of code.
This is often faster and better than starting immediately.
There's another extreme, too: people who can code up an app in a matter of days, but can never learn to navigate and successfully maintain a legacy code base (even their own!).
And there's no easy objective way to screen for this in a job interview. So they pretend it doesn't exist and never ask questions like: "Suppose you're designing a green-field app that you think will grow over time like X, Y, and Z. How would you design and organize your code so that the app stays maintainable and flexible over time?"
I could talk for hours on this subject with concrete examples if anyone ever asked.
I think another problem is that there are so few engineers/architects who really "get it" on this subject. I can only think of a few ex-coworkers with whom I could have the kind of in-depth conversation about app design and organization that I'm picturing.
I've never worked in big tech, always for startups or non-tech corps with a few rock star devs and a lot of decent devs. So maybe it's different at a FAANG. But in my head I'm picturing a bunch of algo-geniuses whose code turns into a big mess over time when requirements take a right-turn and break all their beautiful abstractions. I've worked on a few apps like that and it's not fun.
The goal when hiring isn't to find someone who is barely skilled enough to just slightly come out as better to have on staff than not. In fact these are often the worst hires as they slow everything down and create work for you to find tasks they are capable of, but it seems unfair to fire them because they aren't totally useless all the time. You hire the best candidate overall, and you are very far from describing that.
> check if text has mismatched parens
I always try to give everyone I’ve interviewed the benefit of the doubt. You never know what’s going on in their lives, and even if they fail a trivial question it doesn’t mean they are faking the ability to code.
I joined Facebook back in 2018. Didn’t study at all for the interview and passed somehow. Then I probably conducted 200-300 interviews in my time there, so I became quite familiar with the questions. My performance ratings were all exceeds or greatly exceeds. I voluntarily left on my own after four years to join a unicorn startup. I didn’t prep for that interview either but passed it too. Well, the startup failed and many people went back to Meta. So I actually prepared quite a bit this time and scheduled a mock interview with them. The mock interviewer said I did great and not to change a thing. When it came time for the real screening interview... I failed the matching parentheses question.
I generally try not to make excuses. Almost every interview I’ve failed has clearly been my own fault. But in this particular one the interviewer kept interrupting me every two seconds and I absolutely could not think. I had done matching parentheses many times before in practice, but the constant interrupting rattled me to the point where I totally lost focus and bombed it. Not a great experience.
So yeah, I’d just recommend giving people the benefit of the doubt. Everyone has difficult moments occasionally, but it doesn’t mean they’re stupid or can’t code.
I run coding interviews at BIGCO. Half of the candidate success relies on the skills of the interviewer. A bad interviewer can bomb the best candidates.
Something I have changed my stance on a bit is automated coding interviews. I used to be adamantly against a company giving candidates automated code tests, but I see now that it takes the interviewer out of the equation.
Pre-screening, depending on how it’s done, could eliminate good candidates.
There have been times I’ve received answers in interview that weren’t the written answers, but I looked it up afterward and tested it out… and they were right. I learned something news and tweaked the answer reference as a result. If those questions were in the pre-screening instead of asked directly by me, it would have filtered out good people.
I remember fighting to get access to the pre-screen data to see what the answers were and find if there were any other cases like this, where the non-technical pre-screener was filtering out potentially good candidates, because we couldn’t give them exhaustive answers to questions being asked.
As an interviewer at Google, we arent given an exact list of questions to ask or what to evaluate (there are broad categories).
It is really entirely up to each interviewer how the interview goes and they are usually scheduled between 2 other meetings so often the interviewer is distracted.
Very strange system imo, lots of randomness
What is really crazy about this though is that sometimes it really is the interview setting, as people unused to interviews can, at times, emotionally collapse. I have seen people who are actually good programmers get wrecked by simple questions because of their inability to handle stress, and how the lack of interview practice turns a simple exercise into a hellscape.
It's not as if testing for performance under stress is useless: Tough on call rotations happen, and you might need someone that does well under pressure at 3 am in the morning. But the picture you get on a screening isn't as clear as it appears.
Not to imply that you're wrong, but I've always been bad at LC interviews, but surprisingly (for myself) passable when called upon to troubleshoot and code up a hot fix in the middle of the night. Maybe those are not entirely similar types of pressures.
You are still not testing if they can code. But whether under the scrutiny of another person, they can code. Maybe this is important to you, maybe peer programming is important to you for example. I remember a young dev who couldn’t pass such tests, as he would get too nervous, yet he had written the core tech for many shipped products. The type of guy you would just stick in dark room. With age this type of stuff settles down.
“Scrutiny of another” who’s a peer or even a client is super different from an interview.
The latter has more in common with an open mic night, the prospect of which the vast majority of people are terrified and would break down if they attempted it.
I agree with both you and the parent to some degree. I have experienced interviews that went badly because they were in an IDE I wasn't familiar with, or in Leetcode (never used it). So I'm distracted by how to use the tool rather than how to code the solution. But I can also see how stuff like finding a substring is easy - most languages have a function for it. But at that point, you're testing different things - problem-solving vs rote memorization of a provided function.
I feel like a good middle is to allow Google for documentation searches, not solution searches. Without searching (or IDE with radix completion), I'd probably fail the test for not knowing the syntax off the top of my head.
Some people are good coders but can’t do it with an adversarial person watching. I’m often one of them.
Might as well put a suitcase with $200k and a copper clock ticking away on the table next to them.
As someone who does these types of interviews on both ends, something like this is why I like to start with an outrageously simple question to break the ice.
Surprisingly, I have an 80% fail rate on the first question usually, which is just “find the second largest number in an array of numbers” for a 5 YOE role.
Knowing the right answer and knowing the right answer with a gun to your head are two different skills.
The other replies to this comment aren't wrong but I feel they fail to take into account that (especially with startups): having someone watch you code during an interview is one of the the least stressful experiences the person will face with the company - once the job begins. Companies can't take on the risk of dealing with a bunch of passive-aggressive bullcrap once the real code reviews begin after the hire. Most tech job reqs contain the words "Excellent written and verbal communication skills" on purpose.
Imagine a person with a pilot's license refusing to fly tandem for an airline interview.
> Imagine a person with a pilot's license refusing to fly tandem for an airline interview.
That’s not a great comparison since a pilot has already passed substantially harder tests to get that license and a flight is exactly what the job is. If you have a candidate with a pilot’s license you can assume at least a baseline level of capability which you can’t assume for a software engineer. That has pros and cons but it definitely means interviewing is a noisier process.
The other problem, however, is deeper: the job of flying a plane is exactly what’s tested to get a pilot’s license but what many places do for developer interviews is wildly unlike the actual job so it’s more like interviewing pilots based on trivia questions about the number of rivets on a B-52 and how well they can solve 3-D puzzles, and then being surprised when there isn’t much correlation with real world performance. For example, only at the most toxic companies will the interview be one of the least stressful parts because the rest of the job is a team effort. What makes the interview challenges stressful is doing it without your normal tools while someone else is looking for reasons to fail you, but in a normal job your coworkers are trying to help you succeed because even if you’re not friends you are all better off when your company succeeds. At a startup, trying to ding someone for trivia challenges is like hitting the iceberg to prove that the navigator made a mistake.
I agree, but I look at it like trying out for an athletic team.
Once you're on the team, you are mostly practicing plays, doing clinics, and simulating competition, but to get on the team in the first place you have to prove your general fitness by running, say, a 6 minute mile.
You may not be able to do that again easily right away once you've been on the team for a while because you don't practice running for pure time at that distance, but it's a level of fitness you should be easily able to obtain again if you had to, and it's a very useful benchmark to a scout.
When you're laid off, it's time to start doing that "roadwork" again. It will be a bit hard at first in practice, but if you've been a solid contributor, you should be able to get fit enough again to prove that.
I definitely feel that first part. I landed in a nice company in SF about 8 years ago and am still here. The culture has changed a lot but I often find myself doubting whether I could repeat the whole thing or if I got lucky. (The work is fine, and the company is one of the good ones I feel, so no real qualms there).
Just do what everyone is doing today and use those AI tools for cheating. There’s a whole industry of invisible and hard to detect leetcode AI cheating tools.
Glad they exist and I fully support all candidates using them aggressively.
This is a persistent myth in our industry. If you're a good manager, you can tell within minutes if someone is "for real", if you can't, you aren't qualified to be hiring people. Have you even looked at their GitHub?
A few months of skiing sounds nice, but not as nice as the profound pleasure of working on a team of people I've know and cared about for over a decade.
You're going to spend half your waking life at work. For me, that's too much time to not want to do so at a place where I have real relationships with my coworkers.
This is ultimately what some of the risk comes down to: you invest time(a decade is a long time!) into creating meaningful relationships at work and one day you come in to have your key card de-activated and some corporate speak as to why. There are certainly people working on truly meaningful projects out there, with teams they trust and adore...but for most of the workforce, even in tech, its just work and any fun had at work is a great cherry on top.
How is this different than the manager who has spent years developing an employee - making sure they are getting the experiences they need to build a better career, hiring the right people to complement the team, fighting for bonuses and pay raises - only to have them quit to join the next company for a 10% raise. It is difficult to build a long-term culture when society seems to expect job hopping to rapidly advance a career.
On a related note, it is odd that HN comments rarely seem to include a manager’s perspective.
I've never seen people leaving great jobs for a 10% raise. It's always something else: a much bigger benefit, or a significant downside of the current job, which are not widely publicized. Instead, I've seen people going to a lower-paying position for a more interesting job, a chance to learn new hot thing hands-on, a different set of responsibilities, etc.
I worked with a guy who left for more money, found out the grass wasn’t greener, and came crawling back. Then did it again. For some reason they hired him back a second time. When he quit the 3rd time I think that was the final bridge burned. I asked him about it and he said money was his singular metric for choosing a job, he was always looking, and would never stop.
I once left for a 50% raise, and once for a large chunk of equity in a promising startup (and being able to do early-stage formative work). But 10%?..
An experienced manager would know that is how the game is played and act accordingly. Don't get emotionally attached to any work relationships. It's transactional, keep that in mind.
This mentality is why people don’t get promoted internally, which leads to the job hoping in the first place.
Fix this and a lot of the job hoping problem goes away.
Job hopping is not a problem, it's how you get ahead quickly.
Agreed. Shouldn’t employees behave/feel the same way?
Absolutely.
It's really cool unless your visa is on the line. At least the US is falling apart fast enough that maybe it's not a bad idea to leave and stay out.
You need to find better ski spots!
Just joking :) I firmly respect your opinion on the matter, and understand different people value different things in life.
Wow, I couldn't disagree more. My personal life is what I enjoy, the random people I work with to make money and will be gone as soon as I quit or get laid off, well... I just don't want them to be toxic. I already have a ton of friends, I don't need to convert work people into my social life. Skiing for a few months sounds super amazing though!
Those "lifer" friends may just be later in their career, though. Your ability to significantly advance your compensation depends on how early in your career you are. You will plateau at some point, but early on it makes a lot of sense to job hop. My first job hop was for +66% comp increase. My next was for about +25%, next for +15% or so. Eventually you hit a ceiling. After 30 years in the industry, my last job change was probably about +0.05%. I expect if I have to interview again, it's a toss up whether I'd get a higher or lower offer.
Has to do with H1b visas.
Post layoff, a person on H1B has 2 months to sign a new job offer or they must leave the country.
Majority of Indian and Chinese H1bs do not have green cards, and are the main group that suffers. Some of these folks are well into their 30s, with kids and houses in the US.
I’m familiar with H1b visas. Yes it’s an irritating situation for an immigrant to be in but it’s not as bad as you make it out to be.
If you have good life savings, you can convert to tourist visa, and stay in the country for an additional 6 months and a higher hassle when restarting your career.
You can leave the country, and get back as long as your H1b is still valid.
If your spouse is working, you can be convert to being a dependent on them with H4 visas.
At the end of the day I think the government should not let people end up in such a situation. After the 6 year H1b deadline, I would prefer if the government just sends a notice to those that it thinks can immigrate long term and send the rest back. At least then we won’t have the ridiculous situation of upending families and children who have started schooling just because their parents lost a job.
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I stayed in the same job for nearly a decade, it got really interesting in the second half; in a way that it never would have gotten if I had job hopped every 3 to 5 years.
That being said, once I got bored in the job, I sniffed out that the parent company wanted to lay a few people off, and hinted that I was open to it. It worked out well for me.
I was just too busy in my personal life to look for a job on the side, and honestly I didn't want to walk away halfway through a project.
How do you bring up that you want to be laid off?
I don't get how people get jobs so easily. It took me like 8 months and it was extremely stressful.
Interviewing is a skill of its own. Some people are really good at it.
They have connections from previous jobs who will vouch for them.
How does this work, though? Every company I've worked for has an HR system, and resumes flow through it, and there's a set process. If I have worked with a candidate in the past and highly recommend them, all I can do is submit their resume into the great void and check a box "Recommend". I don't have any other power. There is no "Skip the interview, I vouch for him!" button that I can push.
It's probably related to the size of the company. Most of the companies I've worked for in the past have been between 50-200 employees across the entire org. The dev teams were usually around a 10-20 people and the director of R&D often encouraged us (the devs) to recommend new hires. They still had to pass through HR but it was more of a formality and the director had the proverbial majority vote.
Smaller teams are also more tight-knit so recommending a new potential dev wasn't a matter of process - it was literally head down a few doors and have a chat with the director.
I'm sure it's significantly different for huge enterprises where even the teams within the R&D department are heavily siloed.
> How does this work, though? Every company I've worked for has an HR system, and resumes flow through it, and there's a set process. If I have worked with a candidate in the past and highly recommend them, all I can do is submit their resume into the great void and check a box "Recommend
I haven't worked for any massive companies with thousands of employees where there might be a lot of bureaucracy, but the few I've worked for ranged from ~100-700 and it was pretty easy to get interviews for referrals. One of my employers encouraged referrals and offered bonuses if it led to a hire.
That's how it works in my company too. The recruitment teams barely work with the engineering teams themselves. You may know a very good fit for the team, possibly even a previous member/intern of that team, and you won't be sure you can put the person into the recruitment loop. And then they'll need to pass the interviews...
And at the end of the day the HR work for your VP. And your VP needs people to do things, and if he hears you are a good person and you are available it will happen. HR is just a layer of process. Make them happy in regards to the things they care about.
This story is changing. There is now an oversaturation of us ex-BigCo people in the market. I quit Google before the layoffs, after being there for 10 years and sick of it. The first year was serious ego boost, having Google on the resume opened doors all over the place. Then my ex-coworkers started getting laid off and things began to shift.
Now I know people I used to work with who have been without work for many months and having a hard time getting interviews.
Granted, I'm not in the Bay Area, so. But the market is saturated.
> The first year was serious ego boost, having Google on the resume opened doors all over the place.
Before I worked in FAANG, My subjective view of big tech SWEs was they were very skilled, in a different league.
My current view is that it "just" takes very good preparation and a decent resume to get in. And they've hired so many people that it's not so special anymore to be an "ex-Google". There are just a lot of them.
That being said, I think someone who gets hired in such a company, and manage to stay for many years has to be quite productive and competent. Especially if they reached higher levels.
Competent, yes. Intelligent, yes.
Productive, not necessarily.
Google is not a "produce a lot of code" place. It's a careful and deliberate and systematic type of place.
One thing I think ex-Google does bring especially to the table is a disdane for over-complicated and overly trend-driven solutions.
For one Google's internal review culture is (or at least was when I was there) very stringent. Pointless complexity and showboating is usually spanked.
For two, because Google basically rolls its own everything in regards to frameworks and the like, developers who come out of there have been mainly cured of "flavour of the month" and "my ego wants us to use this new shiny new-coloured tech".
Yep, a sabbatical is taken to mean laid off and low performer. Have to sign an offer before leaving the old one.
Its not that the market is saturated, its that a lot of incompetent ex googlers are interviewing now. People usually have a pretty good idea they can't do their job. They find a niche where a manager is not paying attention, or they can obfuscate and take credit for others work, etc. These people don't usually job hop, the interviews are way too hard and then they are very unlikely to find another long term safe niche to hide in. So previously seeing google on a resume correlated highly with strong competence. A lot of people laid off from google are complete incompetents. A lot were hard working geniuses too, but it doesn't take many interviews where a exgoogler is completely useless to spoil the brand.
The reputation for googlers on the market right now is very bad, and it will keep getting worse as the group of ex googlers who are basically unemployable keep interviewing over and over and over.
There's also the "we can only pay a third of what Google paid you..." and given two candidates that interview equally well, one is former Google and appeared to be making $300k and another is from somewhere where they were making $70k before...
I'd argue for the $70k person. They are less likely to have experienced lifestyle inflation and looking at this position as a "slumming it until they can get a job making $300k+ again."
It further complicates the issue that most companies don't have Google scale problems and don't have the engineering culture for a Google scale solution.
There are several factors working against even not incompetent former Google employees - especially if their experience is entirely within Big Tech.
A bit ago a former Tesla person was in the set of interviews and it became clear that they wanted to make the organization that was considering hiring them into a copy of how Tesla works... and that wasn't something that was going to be doable. The post interview discussion was "this person is going to try to make us into a copy of Tesla for six months, and then leave shortly after they realize that we weren't a place that could become another Tesla."
Big Tech experience may be a positive signal for getting hired at other Big Tech companies... but it can be a negative signal at a company that isn't trying hiring for an organization that can't become a Big Tech company - especially if that is the only thing that is known.
Hiring isn't necessarily picking the "best" person for the role, but rather the least risky. Former Big Tech employees are often riskier than other candidates given their lifestyle expectations and the mismatch of the engineering cultures.
In part true, for sure.
Personally when I left Google and interviewed elsewhere I made clear to potential employers two major things:
1. I never expected to be paid "Google level" money again. I was nowhere near high up in the pay tier there, but it was still almost twice what local shops were paying, at times (depending on how RSUs worked out, etc.)
Google can pay what it can because of the ads firehose, and it was actually, more than anything, a strategy used to deprive the competition of talent.
2. I never actually liked the Google internal culture, so although I was there for 10 years I was constantly aware of the things that I didn't like and the things I would not be trying to bring over to future gigs. And I had 10+ years work experience before Google. Which didn't serve me well while I was inside Google, but definitely has afterwards.
What was the age range of the referred 2023 sample of workers?
> It seems like the heavity majority of those stressed about layoffs in big tech are lifers and those who are chronically averse to and dread the interview process.
Not helped by the fact a lot of interview processes - unless you can rely on word-of-mouth and the corporate structure allows for shortcuts - are byzantine, maddening and/or don't have much relations to the work one will be doing afterwards. No fuck you I'm in for a sysop/cloud position, I won't waste my time doing Fizzbuzz. Give me a laptop with internet and an actual work task if you want to judge my competence.
I don't think that this narrative works in the current job environment. But nice try.
Maybe that perception that people chronically job hop is not true? I would welcome a data source that shows chronic job hopping is the norm.
Anecdotally speaking, I spent 6+ish years at my first "old tech" company. My org in this (very large) company was constantly simmering with resource actions (mostly small scale layoffs). There was lots of negative energy there. I left to take a programming/data analytics gig in a large, privately held financial company that had never had a layoff. This was unfortunately timed, 2 years later the financial crisis of 2008 kicked off and I (and my entire team) were all laid off. I have been with my current employer for approaching two decades and several of my peers have been on our team for that much time.
I have had a SINGLE manager in that time window. I can't even name all the managers I had in my first job due to near-constant re-orgs and layoffs.
Another anecdote from my part. I graduated in roughly 2015. I've had 5 software eng jobs since then. Each one I've had at least 2 different managers in the average 2 years I spent in each. My latest role, however, I was at for 2.5 years and had 6(!) managers. I had originally intended to stay at that role longer term but it was obvious the constant managerial turnover was a negative for my career growth - so I hopped again.
I've not experienced a layoff, but I also think its extremely abnormal to be in a position for so long and only have one manager.
I contracted/consulted around London for decades, and though I was with some clients for many years in total, others were much shorter, and short entries on a CV were not seen as a red flag AFAIK.
(Well, there was one hiring manager idiot who could not conceive of anything other than linear non-concurrent contracts as being honest - that interview did not go well, but I dodged a bullet!)
It seems impossible to think that it's not true given how fundamental it is to (new) tech culture.
I think it's possible that the majority of tech workers aren't hoppers, but the majority of applicants are. This just stands to reason, since hoppers aren't doing much applying and interviewing. This would tend to make interviewers think that this is a dominant strategy even if it isn't really.
It's also the case that the "everything is transactional, fuck your coworkers, leave your job the minute you can plausibly say you learned something and move on, chase impact at any cost because you only have one career" live-to-work contingent is just much louder online, especially here. After all, these are people that are investing a lot in their career, while IME most of my coworkers, even managers (though I don't personally know very many VP-and-up managers) are work-to-live people, mostly interested in their families and hobbies, and seem to rarely post on forums like this.
In any case, I'm fairly certain that there are (or were until recently) Labor Department researchers who have figured this all out empirically and could give us an answer if we knew where to look.
> Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping?
When I leave a job, I always give my employer 6 or more weeks notice with the additional offer that they can still reach out to me for help if they need after that for as long as my memory remains helpful. The time I got caught in a layoff I had the door slammed in my face minutes later and two weeks severance contingent on signing away rights. Maybe the workers who complain understand that circumstances are not always equal.
Job hopping is done to maximize your salary in the least amount of time - but everyone knows that there's a ceiling. You can't just keep job hopping for the rest of your career, and magically end up making 25% more every time you hop to the next gig.
Sooner or later you'll start to reach a ceiling, and have to defend your salary more. The idea is that if you can end up hitting that ceiling in 10 years by job hopping, that's better than spending 25 years at one place to hit the same figure. The earlier you have maximized your salary, the more you can invest and hopefully retire earlier.
Now, once you hit that ceiling - it kind of sucks to be in a constant state of job hopping. You actually don't get rewarded, and it is more stress than anything. And the older you get, the more stability you'll value - after all, you probably have a mortgage, kids, and all that to account for.
It's a chicken and egg problem. If people feel they could have a meaningful career in a given place, they would stay longer. When you see your teammates getting laid off one after the other - including people with 5-10 years of seniority and history of good performance, you start to wonder whether you should have any sense of loyalty to the company.
I joined my company with the naive hope there would be some sentiment of family/community and that I'd do a big chunk of my career there. But after seeing how they treat employees, I'm looking for the way out.
I think the other side of it is:
- Detail-oriented nerds with a rich mental framework around things like optimization, making decisions based on data, perhaps statistical approaches to uncertainty get frustrated when they see their organization making big, irreversible choices without the benefit of all available information. From the IC or line-manager level there may be a bunch of information which you can tell was not taken into consideration.
- Process-oriented people who have put a bunch of effort into planning, goal-setting and measurement based on seemingly reasonable assumptions like "this team that provides service X will continue to exist for the duration of project Y which depends on X" get frustrated when execs throw everything into disarray ... and then 3 weeks later want to know why Y is off track.
As the article describes, often lay-offs end up being bad for the company, not just the employees who get terminated. Even if you're not let go, or even if you just care about the value of your vested equity, it can be quite frustrating to see this happen. And often, because layoffs are generally planned in secret, leadership explicitly precludes the possibility of getting input from the experts in their organization.
While perhaps some layoffs ultimately turn out ok, I think generally the people who go through them can tick off a list of parts of it that were ill-considered and needlessly disruptive, in part b/c of this lack of trust and communication.
I think there are two reasons: choosing to change jobs on your own gives you ability to pick a time when it's minimally disruptive to yourself and your actual family, and then the pretend "family" vibe you cite is pushed by the employer in the first place. Companies insising on a game of make-believe where the relationship between employer and employee isn't transactional makes it hard not to be bothered by the hypocrisy. I agree that on average, the tech industry isn't as bad as other industries often are, but I don't see why that's a compelling argument not to care about the fact that it still could be better. There's nothing stopping me from wanting fewer tech layoffs and better conditions for workers in other industries as well (and in some circumstances even advocate for that even knowing that it might require changes to my own quality of life to achieve that; as a trivial example, I go out of my way to tip much larger than 20% when I use Uber because I'd rather risk getting ripped off than a driver not getting paid a fair wage for the work they do for me, even if it's at my own expense).
At the end of the day, everything is a balancing act, and the amount of change most of us can make as individuals is a drop in the bucket compared to the unfairness that people have to deal with every day. We all have to make judgement calls on where to take a stand and where to play it safe to avoid making things harder for ourselves without actually making a difference that ends up helping anyone, and if people are acting in good faith when trying to make those choices, I don't see any value in criticizing what they end up deciding. If anything, most of us in tech are probably in far more of a comfortable position to be able to speak out against employers (either or own or those in industries where workers are treated even worse), so I think there's a reasonable argument that it's more important for us to because of that. It's not a zero-sum game though; pointing out tech employer hypocrisy doesn't inherently take anything away from pointing out even worse things that other employers do.
> I go out of my way to tip much larger than 20% when I use Uber because I'd rather risk getting ripped off than a driver not getting paid a fair wage for the work they do for me, even if it's at my own expense
Honest question, as a European who doesn't fully understand tipping culture: don't you think that this might be perpetuating a culture of exploitation? Wouldn't you rather spend your money on taxis that at least have some regulations if you are afraid the drivers are getting the wrong end of the deal?
The thing is, the tech industry is also an outlier in a sense that the quality of the job you find varies massively depending on (1) the timing, sometimes literally by a few weeks and (2) whether you already have a job or not.
And so, layoffs are not "just another bump" in people's career. They represent a major net negative for people who would otherwise have much more control over the trajectory.
I've worked over 12 years at the same company. Finding a new job would be difficult as remote pays lower and isn't the best fit for me, my area isn't known for tech job, my spouse doesn't want to relocate, I work for one of the biggest employers in my area (fewer choices outside the company), and we are seeing the highest sector unemployment since the dot com bubble. Oh, and my disability makes it all worse. My job has been an absolute hell hole for the past 2 years, but internal and external job opportunities have been extremely limited.
I guess there are a broad range of perspectives and how loud people are is going to depend on their perspectives. Some reasons to dislike layoffs:
- visas may be dependent on employment, and can make changing jobs harder. In the United States, lots of visa rules are at the discretion of the government (eg how long one may live in the United States on an employer-sponsored visa while unemployed)
- the recent (and dot-com era) tech layoffs have been cyclical: many companies are in layoff-mode or hiring-spree mode at the same time. The time when many companies are not hiring is the worst time to be thrust into the job market
- people may have other job security worries – big tech companies tend to always be growing so it is worrying if they are laying people off instead of moving them from a failing business line to a new one
- in general some people may have a lot of anxiety about changes to income. If you are applying for new jobs while currently holding another, there is much less pressure than if you’re unemployed and need to find a new job (and possibly at a pay cut requiring outgoings to be reduced) before you run out of savings, especially if you don’t have much in savings compared to outgoings, which may be the case for some tech workers (some people spend a lot, or have much of their wealth tied up in property or have a family which requires spending more on eg housing or school fees). The much-worse consequences of failing to get a new job may increase the pressure/stress/discomfort
- this reveals an obvious truth about where the power lies in ‘engineering-focused’ companies and people don’t like it
- people can see a layoff as being like a firing and therefore be unhappy due to hurt pride (or worries about being less desirable in the job market)
- the lack of agency in a layoff is unpleasant. It is quite different from choosing to apply to other jobs.
The tech industry also doesn’t reward loyalty, even at big tech.
There’s a reason for the low tenure at most firms and it’s primarily due to the lack of rewarding experience and depth of field knowledge at most companies. When you have to get a new job just to get a salary increase that keeps up with inflation you are going to see a lot of job hopping when the skills of the workforce are generally in demand.
How often is it that someone leaves because they can get paid better elsewhere? Why do we think this wouldn’t drive the primary cause of people leaving companies?
Where the fuck is the company showing any loyalty to its workforce?
> Where the fuck is the company showing any loyalty to its workforce?
They have been and are out there. But all it takes is a change on C level and cost cutting suddenly is everything, loyalty a thing of the past. That is, you cannot count on loyalty anymore, even if the company you are working for is currently showing it (or seems to).
Yeah I don't see the big mystery here. People leave to keep up with cost of living or get away from toxic elements in their current workplace that are otherwise difficult - if not impossible - to change by staying. It's not something we want to do, it's something we have to do for one good reason or another. If we had better rights and meaningful raises to improve or even sustain our quality of life, the job hopping would surely decrease. The layoffs and the reason for job hopping are both attributed to actions on the employer's side.
For almost every job I've had, I would have been more than happy to stay there if it provided the career growth that job hopping provides. Companies seem to deliberately make internal promotion far more difficult than just job hopping to L+1.
> The tech industry also doesn’t reward loyalty
Anecdotally, I’ve heard of many cases of “up or out” in FAANGs, which in other terms is a negative preference for loyalty.
(This, in fact, is one of the reasons people working in those companies perpetually seem to be practicing interview questions and Leetcode every day.)
Big tech employees have been abandoning companies the second they can get higher TC for decades, and as soon as the companies start firing a very small fraction (in a lot of cases people who were coasting or incompetent) its a problem of morality?
You can really see what people are made of when they face adversity. Good luck.
Big tech employees are a fraction of all tech employers and employees. There’s problem so systematically pervasive that you see this across the board. Companies do not value long term retainment of employees up and down the size spectrum and it’s very clear in how they behave.
They don’t award experience and depth of knowledge in any way that is indicative of fostering retention
Many of the stereotypes you mention are for startup founder / early employee types.
That's not everyone, it's just who's on HN.
Most employees of these companies are just regular people wanting regular jobs.
What % of the your coworkers have been there 5+ years?
100% (I have owned and worked at my own company for 10 years)
Anecdotally, I've also worked at many startups that became big companies through acquisition and Let me tell you - J&J has a lot of employees who have been there more than 5 years, thousands. They also had several big layoffs of such people during the process.
I work at salesforce. 100% of my immediate team and gotta be over 50% of my broader team. We’ve barely hired since 2020.
Because a lot of tech workers today aren't actually job hopping and instead get very cozy in a job and a team and a career trajectory, which feels unfairly ripped away during layoffs for reasons that don't feel connected to their personal performance.
2 way street. you say "it's laying off a bunch of people who were gonna dip in 6 months to a year anyway."
to the new grad, it's "wow half my team just got laid off when the company seems to be doing fine, i guess i better not get too comfortable here"
Kind of sucks when you have stock…
That's kind of a chicken and egg issue, isn't it? Why is it that employees can get more money/promotions from a company they have no relationship with, than from a company where they've already been working for multiple years and have more company-specific knowledge than their replacement will? Unlike with government work, years at the company isn't really considered when deciding who layoffs are going to hit. You're proposing that tech workers should loyally stay at the same company for 10 years, make less money, and then get laid off just as easily anyway?
Tech is a huge field. If you work in big tech or well-known companies, it is common to job-hop. If you're at something more established, traditional, or mid-sized, you'll probably find lifers.
Additionally, I think fewer people are job-hopping considering the market is so competitive. I would expect new grads to start staying at their first job for longer, too.
There is attrition and there are layoffs. With attrition someone leaves every year or so, you part on good terms, and the company hires a replacement on a similar level and location.
Layoffs means reducing headcount, your team ends up weaker than it was, and everyone is left wondering if they are next.
I get the point, but I don't think that's universally true. Especially in the less glamorous corners of the tech industry -- yes, you have some younger people looking to bounce, but most of the people who actually keep the lights on have full lives outside of work and all things being equal, they'd rather stick around than deal with the hassle of finding a new job. They're only going to leave if you create a toxic work environment or underpay them by double-digit percentages.
For those industries, I don't think they're getting much from the layoffs besides the short-term "we did layoffs" C-suite bonus. If you're in the Widgetmaker Control Systems industry, why do you want to make your workforce think they have to leave in 3-4 years?
I’ve been at my company working in tech for 19 years and I hate the pushing of job hopping as a norm. Job hoppers have no skin in the game. They don’t need support what they build, they don’t get to see where it fell short… they really can’t learn from their experiences and mistakes. What they do isn’t in the best interest of the company, it’s just enough (an MVP if you will) to add to the resume so they can leverage it for a bump in pay on their next job.
I see wave after wave of job hoppers hired to “transform” the organization and all they ever do is repeat the same old mistakes, which we could tell them if they weren’t too arrogant to listen.
Every job hopper I’ve worked with has simply been a distraction to the greater goals of the organization to serve the customer. I’ve lost all patience and respect for the people who practice it, and the companies that set themselves up in a way which encourages it.
I don’t know how we find our way back, but I think companies and employees would all be better off with some stability and more long term thinking.
I think the solution for this would be for companies to proactively raise wages in order to keep up with the market.
Yes, but it also takes some level of patience on the part of the employee.
Corporate bureaucracies often move slow, and they also want to see you can do the job first. I’m seeing most younger people don’t seem to have patience for this.
They also grossly overestimate their knowledge and ability. I’ve seen a significant number of people talk like they mastered a job after 1 year, then they stared asking me how they could get on my team doing what I do. I did the job they were doing for 10+ years. The reason they think it’s easy is because I defined the processes of how to do it all, wrote all the documents on how to do it, made a training program they went through, and worked with other teams to remove a lot of the toil. I then started building tools to make it easier for anyone off the street to do a lot of the work, and do it at scale. Thats why I have the job I have; it wasn’t given to me, I created it out of a desire to make the team better after realizing we could only go so far if I just worked faster. They didn’t see any of that.
For those that seemed interested, I’d give them the tools they needed to help, to see if they were the type to do this kind of stuff. I’d provide feedback, answer questions, or do anything else I could to help them. Out of the dozen or so who asked, only 1 person has done it to a limited degree. Thats why companies don’t just offer it up quickly and easily. A lot of people talk, but not many back it up.
I agree with parts of what you say. I’m a career contractor or job hopper. I like it this way. I also am aware of the volatility of the industry. I prefer hopping and getting 20% pay bump each year. This more than offsets the risk of being laid off and staying a few months without income.
Different groups of people. Some confidently job hop, others live in fear of losing a comfortable job.
There are deep differences in expectations and attitudes in these areas, driven by family, culture, and upbringing.
I think your idea is a good faith argument, but it's a fallacy: high turnover on a job because of stiff competition for labor is not a "tech culture" issue, and it's not at all the same impact on a person as changing due to a layoff.
This is an interesting question to ask, though I personally would not attribute it to "culture" as much as it may be a product of the environment people are put in. From my experience, there are a lot of jobs that make it difficult to continue past a few years, so job hopping is the inevitable outcome of that. I think many companies need to examine why they have a lot of turnover instead of attributing it all to individual employees.
And to be frank, layoffs are scary for any industry, because they usually are correlated with layoffs at other companies. A rising tide lifts all boats, but a sinking tide is difficult to escape. You might be laid off at a time when there is no other job to hop to.
> there are a lot of jobs that make it difficult to continue past a few years
This has been a lot of my career. All my long, successful jobs have lasted around 2-3 years, and it's the time it takes for the company to realize the initiative wasn't worth it. I count four of these stints where I left, and the team was essentially dissolved within a year. I'm not saying I was the key person for the project; I just saw the writing on the wall.
It's been career limiting not having a large-scope project on a growing team, but I don't know if this is something about me, something about the projects I'm a good fit for, or the reality that a lot of projects and teams don't survive 5 years, and I've been exposed to some survivor bias of smart people who have gotten lucky.
That is a great example of what I was talking about.
Another example is the changing nature of the contracts people are hired under. I'm a scientist, and a lot of positions are inherently term-limited. You end up with a lot of organizations with two different groups of employees: employers who have worked there for decades, and employers who are temporary and work there for a few years hoping to be converted to permanent. Just like in the situation you describe, if you end up on a project that just isn't working out, that does not bode well for your own prospects. That has nothing to do with your own capabilities or how hard you worked on the project. And just like you mention, a lot of the "permanent" people have survivorship bias and do not really understand that they ultimately got lucky and timed the market well.
(Or many of the permanent people were hired as permanent staff originally and do not understand the conditions under which new staff are hired.)
In tech, consultancy usually last between 3 months and 18 months, so one can have many consulting positions of under 2 years.
The average tenure of an employee at HP is 6.6 years (source: Google AI) to pick a company that may be outside your bubble. And the lifelong career holding older employee at a legacy enterprise tech company is the kind of worker who is most adversely affected by an unexpected return to the job seeking pool.
Depends on the country, in many European countries job hopping is not well seen regardless of the industry.
Citing an airline for longevity is a bit disingenuous.
I’m not sure how it works with support staff, but aircraft crew have contract structures that so heavily favor seniority that most pilots and FAs will never leave a major willingly during their career.
Your observation, to me, seems more like: tech companies reward new employees over old, airlines do the extreme opposite.
I resent the fake legal douche move of falsely asserting "low performance" as the rationale for their cuts.
Some people work hard and take pride in their work. And on top of their gaming down our wages with h1b workers and low benefit contracting they have the gall to assert we're low performers when what they want is a $20 million bonus for their execs.
But yeah, I see your point.
> Why do tech workers get so wrapped around the axle of layoffs when most people are in a chronic state of tech job hopping?
Most of us job-hop because we have to, not because we want to.
There's a class of people in the tech industry who like to write blogs about how fun and fulfilling it is to constantly change jobs and roles. Those people are highly visible but not representative. Most humans find constant change and uncertainty stressful, not exhilarating.
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> when most people are in a chronic state of tech job hopping?
Citation needed. The vast majority of people in tech that I know do NOT job hop. So please, I need a citation, not your feelings.
Because it's usually only true in your early 20s. Then you find a place and stay. These people bragging about company hopping every 3 or 4 years don't do that for 20 years.
I think many people at big tech companies like Facebook truly drank the koolaid there, and when they got laid off it laid bare that the companies they worked at were just companies. Facebook, Google, Amazon, etc are no better than Microsoft, IBM, Oracle, or whatever other 20th century company they had come to represent the answer to. I think a LOT of people had really tied their identities up in being a big tech employee and when they got laid off it was like being cast out of paradise
Because not every company gives severance during layoffs. As someone who got RIFed (again - fourth time in my 15yr career), this is the first time I've had severance, and the first time I had a notice period that wasn't just "till the end of the month". As such, layoffs are traumatic just on their own.
Adding more rapid-fire context (for the sake of brevity):
* Parents changed jobs every few years growing up, which meant a new city, new home, new schools, and a complete cycling of relationships (forcibly out with the old, forcibly in with the new)
* I watched layoffs in non-tech sectors gradually go from tech-style severance packages, to no packages beyond the required WARN notice period payouts, to filing the notices and hoping nobody asks, to now just paying out any damages after-the-fact in lawsuits
* I spent ~15mo unemployed during the "Great Recession" of '08, ending up having to move to another region of the country for work and spending a night homeless, followed by six-months couch surfing, then another month in a hotel before finally having an apartment again
So all that put together, layoffs and job changes are incredibly traumatic experiences I do my best to avoid at all costs. I am one of those "lifers" who would much rather hunker down for a good wage today, buy a home, sock away savings, and work my way up an internal career ladder than throw myself into an entirely new workplace, colleagues, culture, and standards every year or two. I claw for multiple roles in an org (at the most recent one, I was juggling roles on Private Cloud & Public Cloud, Governance Councils, leading a CaaS ops overhaul, plus other PoCs) specifically to make myself as indispensable as possible and position myself on the internal promotional ladder, because I'd rather stay with one org provided I can eke out a modest living and take care of those I care about (myself included).
Now all that aside, there's also the reality that wage growth from job hopping hasn't turned out to be as big as folks thought. The real growth comes from career promotions, which companies hate doling out internally for profoundly stupid and arbitrary reasons (hence job hopping). I get the impression most folks would stay put if they could get the growth in their career they wanted, but companies would rather hire someone externally to fill a spot than promote someone internally operating at that level; I am very much in that group myself. Heck, we're seeing that now with folks not leaving jobs because they're having difficulty finding that growth (in comp and title) elsewhere, as everyone kind of knuckles down for tough times ahead. That taste of stability will create more "lifers" as you put it, especially when the world outside is increasingly unstable; it's natural that humans (and most animals) will seek stability in times of crisis, taking only as much risk as necessary to preserve their survival.
Something the article doesn't get into is the knock-on effect of layoffs in future business: if workers are let go for what they perceive to be arbitrary or irrational reasons, they're less likely to want to do business with that company again in the future. This is particularly why tech companies offer such good severance packages, as it's their mea culpa of sorts by trying to buy themselves a good reputation on the way out the door. When everyone is doing it though (like the current layoff cycles), it becomes a broader disgust or distaste for established vendors in general, and those workers - when they land a new role - are likely to want to migrate off their employer's products unless their career is tied to it somehow. This can reduce business after cuts had already been made, potentially putting an organization into a cycle of self-harm wherein more cuts are made in response to declining business, which then causes more declines in business, which leads to more cuts, etc. This in turn leaves a huge opening for new startups to enter the hole left behind by established players, undercutting them on pricing and providing better service.
So taking all of that into context when reading the article again, and it paints a pretty telling picture of widespread mismanagement at companies doing unwarranted and highly traumatic layoffs. If the only thing your leadership can do to grow the business is to layoff staff, that's a pretty telling sign that business ain't doing so great in general and leaders are out of ideas to improve it.
Well, getting fucked out of your 401k money 6 months before it vests stings some.
Is that an average time given a 12 month vesting schedule?
edit: Actually curious about the dead comment. What companies have multi year 401(k) vesting?
Every company I have worked at or seen does a match on a 12 month schedule or less.
Are they thinking of stock options?
IIRC Amazon has a 2 years 401k match vesting period.
Interesting.
per this article, Amazon 401k has a cliff vesting on matched funds at 3 years of employment. After reading around, it seems like 3 years is the legal maximum for 401k cliff vesting, with 6 years permitted for incremental vesting.
https://www.consiliowealth.com/insights/breaking-down-amazon...
Two years is more typical.
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I mean in all fairness, I move around because I’m looking for a place to stay - if I’m not enjoying myself at my job, why would I stick around? And conversely, when I find a spot I like, why job hop?
And besides, the last time I was laid off, it was from a place I’d been at nearly 5 years, a place that did feel almost like family - that’s why I stayed as long as I did.
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"Why do tech workers get so wrapped around the axel of foreclosure when most people are in a chronic state of moving house?"
This is a terrible opinion piece. Layoffs do work. Cutting hours does not work. I am always amazed how few people understand how a business operates. They think its a community organized event where there is unlimited revenue.
There are a few basic accounting principles employees need to understand. It all revolves around Assets = Liabilities + Owner’s Equity. If you think otherwise, take a "Cost Accounting" course. This is a pure numbers game. Everyone wants to wrap a psycho analysis into something that has ZERO relevancy.
If a company is bleeding revenue, it cannot sustain the overhead of employees. They have to go. Cutting hours does nothing for those on a salary, and those that are hourly, benefit costs are far more expensive than their wage. If a company has stagnant growth, that means leadership has made bad decisions, and things have to change.
Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement. There is not a "Employee's Feelings" column on the ledger. Everyone can be replaced. No one is special, unless you're a majority shareholder.
> If a company is bleeding revenue, it cannot sustain the overhead of employees. They have to go.
No, they don't. During the dotcom bubble my company gave us 2 choices, layoffs or 20% pay cut. We took the latter. Everyone stayed and we had our pay back to previous levels in a couple years and the company remained profitable.
You can, in fact, treat people as people and still run a company.
> Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement.
This is only true of companies of a certain (large) size, when all semblance of employees being people have been abstracted away. In companies of more reasonable sizes you must take employee moral into account or you will lose critical employees which could kill the company.
> If a company is bleeding revenue
Not what happened with some of the recent layoffs. Some big tech companies generate huge revenues, laid off 5-10% of people (sometimes with false pretext of performance), and do keep hiring at the same time or soon after. This happens not to reduce cost but to stress out remaining employees.
>This happens not to reduce cost but to stress out remaining employees.
Or to cull the low performers.
I personally am less stressed when the competition I outperform gets fired.
That is what happened in recent layoffs. You can look at the company as a whole and say, well they were making money. Specific divisions of the company were in the red. Many companies rotate the bottom N percent to dump the bad performers. If you're not doing your job to the best of your ability, there is someone else out there that is willing to do the job. You're not special.
> Many companies rotate the bottom N percent to dump the bad performers
I have never seen this actually happen in practice.
It's always specific teams and projects that get fired because some C-Level fucked up and pushed for some ego project, or over-hired and placed those poor souls in useless projects.
Yes, because you've never seen it means it doesn't happen. I appreciate your appeal to ignorance, but it happens in most large companies, and this should continue in most companies.
This is not what happened in recent layoffs where I am familiar with the company. Perhaps you would like to make the argument that in theory, lay-offs can be done that way.
What’s actually happened is that activist investors have bought their way onto the boards of highly profitable companies with insufficient poison pills and made them fire some percentage of workers under the guise of making the stock price go up.
Does worker happiness matter at all, or is it OK to have a net miserable company where the bottom line is slightly higher profit than it would otherwise have been if the environment were a pleasant place to work? Because that’s the tradeoff here; rabid billionaire investors are unhappy because numbers aren’t as high as they could be.
Activist investors are a problem. Most recent activist investors have been centered around climate and DEI. Exxon had activist investors try to get on the board. There was a lawsuit over it, I believe it was Arjuna Capital.
Whoever is funding these activist investors, probably a nation/state, is doing it on purpose. Natasha Lamb has to be the dumbest investors to ever live, next to Cathie Wood, IMO. You could invest in an S&P index fund and perform better at 264% for the past 11 years, compared to her 132% realized, and taking far less risk.
I get everyone has their idealistic views of how the world should work, but capitalism dominates every other society, providing better living standards, and security. It is unfortunate we have had leftists in the Democratic party take control of it, and pushing some very strange agendas, that doesn't reflect reality. These strange agendas have been exploited by other nations, like China.
Some activist investors have brought better function management and boards. Carl Icahn is a great example. But he has also brought his fair share of problems.
They have way, way more employees than they need.
It is still to reduce cost. Hiring would often be in cheaper geographies. The reason to reduce cost is not to e.g. save a business from collapsing but it is to improve the financial results with the hope of making the stock price go up.
A good friend of mine has a PhD in labor economics and is now a senior management consultant for a big firm and I've been told that in general just cutting people is bad for businesses and most businesses will be worse off by just cutting people, especially without changing any of the underlying systems that got the company to the position it's in. Next time I'll have to ask him about the studies on it but there definitely isn't a consensus that general layoffs help businesses in the medium/long term. He was saying the times they seem to work best is in the context of a broader restructuring, (which in my experience is not common for companies).
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No, just cutting people across the company tends to be bad.
Restructuring aka cutting programs and the people working on them has fewer downsides.
No, it really doesn't.
There’s plenty of studies showing the downsides. It’s expensive, results in dramatic reductions in efficiency, etc.
Widespread layoffs are a sign management has majorly fucked up.
Unsurprisingly, both the OP and this are oversimplified statements.
The more nuanced point is to note that simply reducing the world to accounting equations omits all of the human detail. Morale is a meaningful thing, or if you prefer, knowledge, expertise, Metis; these are damaged in layoffs, especially repeated rounds. And furthermore, the recent tech layoffs were not generally about fixing unsustainable businesses, they were about juicing profit margins for already profitable ones.
On the other hand, of course the OP title is wrong and layoffs can work. There are many examples even within tech where cutting deep is the only way of surviving.
Complex systems are complex.
Math wise, yes, you're correct, but layoffs can also hurt morale, especially if not done well. And in a competitive environment, the most talented people might be next to leave after a layoff, as they see things aren't going well and have the easiest time finding alternatives. I've seen that happen myself.
And some of those people you're laying off did revenue generating activities, so, as above, yes, it may be necessary to reduce costs, but it has to be done carefully.
> Employees feelings don't matter on a Balance Sheet, Income Statement and Cash Flow Statement. There is not a "Employee's Feelings" column on the ledger.
Sure they do. Just in the sense that employees feelings need to be controlled and made to fear any collective action or sense of agency.
Many larger do companies behave as if revenue is unlimited.
Too many times, I’ve seen layoffs followed by acquisitions of 10x the cost reduction from the layoffs — often even in the same quarter. And when parent company has a track record of driving acquisitions into the ground from mismanagement, where is the profit?
Also cutting hours sounds terribly out of touch with the gig economy dilemma, I'd rather be let go than put on half my salary?
Layoffs are like closing factories that don't produce, cutting products that don't sell, closing deserted retail locations, and so on. Likely bad business decisions got you there in the first place. Maybe market conditions changed. Maybe your whole company is going to fail no matter what you do. But blanket statements about what does or doesn't "work" are not very instructive.
Also I'd argue that a lack of layoffs at a company probably causes stagnation and inefficiency. I don't thin the only good argument for layoffs is that a company has no choice because of cash flows.
I see this in the public sector where you often find people who have been working at the same dept for a decade or more. These people feel very safe and know they don't really need to try that hard. They also know nothing about how things function elsewhere so they'll put up with using spreadsheets and fax machines because that's just how they've always done things.
It seems rather obvious to me that a good economy is one where employers feel some nervousness about losing good employees, so offer pay rises and perks; And where employees feel some nervousness about layoffs so work hard and try to be as productive as they reasonably can be.
If a company is not cutting a few percentage of their least productive workers each year they're probably doing something wrong imo. I think it's far to argue big tech companies built up a lot of these under productive workers over the years.
Your horribly simplistic take has already received a lot of backlash, but whatever I'm angry enough to add onto the pile:
1. Big tech companies doing layoffs are not hurting on revenue, so your basic assumption is wrong. 2. "Cutting hours" needs to be steelmaned if you're not going to anything but a charlatan. That means you have to interpret it as taking a paycut, as in a salary cut. This has actually been done before in worker-focused companies to survive covid, and in one instance I'm aware of the company gave workers back pay after surviving covid.
You also ignore all the intangibles that are no easy to measure, because of course the business acumen of "make number go up this quarter" is too short sighted to care about institutional knowledge or long term strategy.
> If a company has stagnant growth, that means leadership has made bad decisions, and things have to change.
There is a bigger picture.
Developed economies across the globe are experiencing stagnant growth, and the trickle down economics they have engaged in has failed to fix that.
Knowing this, the wealthiest, through their proxies in corporate leadership and government, are cutting back their biggest cost - employees - to maximize their near term returns, which will then be put into relatively fixed-supply assets, rather than risking capital on new ventures, and the employees that traditionally requires.
Corporations are betting that "growth" going forward is going to come from AI-enabled efficiency and productivity gains, not more employees making more product or innovating on product/service development and delivery. While it's too early to say whether they are right, many signs point in that direction.
At least for public companies, accounting is FAR from the end all be all.
Most of the time, company valuations are completely divorced from valuations. And much of what public companies do these days is try to game their stock price.
Government employment is 95% the time completely divorced from reality.
That being said, private companies employee a lot of people and this is very relevant.
> Government employment is 95% the time completely divorced from reality
This is a pretty big claim to make without any evidence to support it.
The government, whether it be state, local, county federal etc. does in have a different pace and certainly like with any big organizations can have issues such as waste, but to say it’s completely divorced from reality, especially in context of somehow private (as in not government or NGO) companies don’t also act completely divorced from reality is a really big claim
Private companies generally need to be efficient and make money or go out of business.
VC funded startups are a VERY small percentage of jobs compared to ALL private company employees. But, sure, there is much shenanigans there.
Public companies can play tons of games as well - but the vast majority of people employed at public companies are at relatively efficient and profitable companies.
Government services are under no obligation to be efficient.
Often people vote for them to be LESS efficient, hoping that they'll get similar benefits from their private employers.
Though, hope is a bad strategy, and it rarely works for non-government employees.
But there's enough state employees that you don't have to win over that many private employees to win votes for things that make the services less efficient (like ever juicier retirement benefits).
> Private companies generally need to be efficient and make money or go out of business.
Half of this statement is true. A private company definitely can’t run at a loss forever. Although in the era of ZIRP a few definitely made a solid go of it.
However nothing requires an any company, and especially a private one, to be efficient. If an otherwise profitable and privately-held company wants to swell its middle management ranks or spend lots of cash employing the owners’ dubiously capable relatives, there’s nothing to stop it.
Incidentally that’s mostly true of public companies with diverse shareholders, too.
The idea that private enterprise is always efficient is a myth, as is evident to anyone who’s worked for a large enough corporation, or even a small one where management weirdly shields some obviously incompetent people for internal political reasons.
The only correcting factor is that companies can fail, and smaller competitors can sometimes find ways to undercut large, inefficient firms. But often the small company gets acquired or out-marketed. So there’s nothing inevitable about any of this.
The article cited actual statistics and data comparing companies that enacted layoffs vs those that didn't. It showed very clear evidence, even within the same industry, that those that enacted layoffs fared MUCH worse
Also many of these layoffs are NOT coming when companies are "bleeding revenue". E.g. Meta and Twitter enacted massive layoffs after posting their most profitable quarters yet
That’s what should be expected. A company in a stronger position can more confidently avoid laying off people and “ride out” the painful market conditions. Not every company’s revenue is composed of similar risk items even within similar industries. Some companies are already knee deep in some new strategy and need everyone on board to roll it out. The other company is just a bunch of variable labor that can be culled when volume shrinks. It also means they’re not investing in the future and going to get beat by a more strategic competitor. So many other riffs to take on this, but short term minded financials are absolutely improved by layoffs and that’s usually all the action is trying to effect.
I mean, everything you said is true, but only because we have deliberately set up the system as such. Shareholder Primacy is a choice we have made as a society. It's not some natural law or something carved by god into stone tablets. It's not hard to imagine alternatives, but obviously the shareholding class is going to work hard to ensure that only their preferred rules have traction. Whether or not alternatives are workable given human nature is another thread altogether.
Shareholders don't have "primacy", eg they're last in bankruptcy. If you're asking for them to never get anything, then they're not going to participate, and this is supposedly a forum about startups.
In tech the employees also tend to be shareholders which I think is healthier.
No, it's not a choice we made as a society. It was a choice the shareholders made. You didn't make that choice, you were not part of it.
That's a good point! I never got the chance to vote on whether or not shareholders should get all the votes.
Why should you get a vote? You don’t get a vote on what groceries I buy. What entitles you to a vote on this purchase decision? (In this case “all the votes” means when making decisions on actions a particular corporation is considering, not any vote on anything)
Lots of places take vote on what you can buy, eg weed, alcohol, which additives are allowed and so on
The creation and transacting of corporate shares is also highly regulated. But it doesn’t address the question of why a third party should get a vote that helps decide a particular corporate action. Votes that limit the possible actions of all corporations equally are a different thing.
Why do you feel entitled to something someone else built?
>only because we have deliberately set up the system as such. No one can sell at a loss all the time. That's just stupidity. Either I get a return on money invested later or I get a return on my balance sheet now in the form of profit. Shareholders primacy is because they can only be cut trough a buyout.
Why can’t the outrageously overpaid leadership who made the mistakes be the ones who are punished instead of the individual contributors who are just trying to survive?
> After the early-2000s dotcom bust, Bain researchers found that stock prices for S&P 500 companies that had no layoffs or laid off less than 3% of their workforce increased an average of 9% in the next year. Meanwhile, stock prices were flat in companies that laid off between 3%-10% of their workers, and prices plummeted 38% for companies that laid off more than 10%.
Failing companies go through layoffs. Companies like Sun Microsystems, Kodak, Sears, Circuit City, Kmart all went through lots of layoffs. But everyone knows that's not what killed them.
> But everyone knows that's not what killed them.
Another addition I'd like to add here is more often then not wrong people get booted while the "dead weight" tends to stick around and becomes even deader due to a motivation fall from the layoff. So maybe it doesn't kill, but for sure exacerbates an already bad situation.
We are a small team in big company, and management that made wrong decisions is still somewhere there but not my direct management, still getting same paycheck, car, cards and benefits but new managers (that accepted to take over and got brand new car for 100k€, cards and bonuses, bells and whistles) started to layoff workers so we know this is the end for my team, and of course they will do whatever it takes to "save the product", but not fix the the real issue... lack of good developers to fix terrible bugs in our product.
That’s really the key part: if the managers who created the problem are still there, layoffs will just make it worse. There are cases where getting out of a dubious business line can lead to long-term benefit but I’ve seen that a handful of times compared to losing useful people while the bad managers failed upwards.
That's basically the story of Philips. They go through a tough period and choose to divest a "dubious" line of business to focus on higher margin products. The new company, freed of Philips management, goes on to surpass the revenues of the parent. That's how ASML and NXP were born. Signify (Philips lighting) is getting reasonably close.
If your small team in a big company does not directly generate money, then you’d definitely be ripe for elimination. Time and time again we’ve seen examples of trams that are critical to supporting various revenue generating parts of the company while not directly making money themselves get cut as an “obvious” way to save money when only looking at the books. Been there.
The thing is, ending a product that's not making money shouldn't mean eliminating the workers. Those were people you picked, brought in, and have adapted to your culture.
It always strikes me as weird when a product fails and the decision is to eliminate everyone from the product manager down... and then make no other changes. Then they bring in completely new people for whatever the new product line is. Sometimes, sure, an individual or group might cause a product to fail that should otherwise succeed. But it's weird to default to the production team. Is it a design problem? A maintenance problem? A product price problem? A sales and marketing problem? A management problem?
Like, the Pontiac Aztek did not do badly because one welder from Mexico screwed it up. It failed because it was ugly. It was ugly because the styling didn't survive the requirements to use the same parts as the Buick Rendezvous and the same basic platform as the Pontiac Montana. The process of making that vehicle fit into GM at that time killed the product. Today the Chevrolet Equinox, a direct descendent, is one of the best selling vehicles on the road at a time when there's a lot more competition.
Workers cost money. Layoffs don't just happen, they happen when management is under pressure, usually because they won't make payroll in a couple months, occasionally because the stock market demands better margins.
I get that you have no experience at that level of a company but you could spend some time researching it.
https://chatgpt.com/share/67cdcf56-a24c-8006-bc54-b2bcccfa7c... Inb4 chatgpt, it knows a lot more than op here.
> Time and time again we’ve seen examples of trams that are critical to supporting various revenue generating parts of the company while not directly making money themselves get cut as an “obvious” way to save money when only looking at the books.
Love how your typo turned into a beautiful metaphor for infrastructure being cut.
Save the trams!
Some are kind to eng ICs, you’re not laid off from the company just given time to join another team. As you can still be a high-performer with context on company culture/tech stack while on a non-revenue-generating team.
Even if mostly the “right” people are laid off, laying off a wrong person can have a cascading effect.
Good people like to stick together. Get rid of a couple and the rest will start to leave.
Even if, from the company's perspective, if lays off all the "right" people, some of those people will be "wrong" from the point of view of other people on the team. Maybe the company didn't value a certain person, for corporate or HR reasons, but there's always a chance that person was a valued team member for human reasons.
Layoffs will lead to people leaving, regardless of how surgical or random they are.
Exactly. Somebody who is universally hated by their co-workers should just be let go. Nothing to do with a layoff. So everybody who is around has some reason for actually being there. In a well-managed place, that is.
> Somebody who is universally hated by their co-workers
How many times have we seen a company fire whoever they consider "dead weight" but keep the universally hated guy because he's a 10x rockstar whatever?
A 10x person who brings down 20 others to a small fraction of their potential and causes other rockstars to leave is still net-negative. Good management understands this.
(And I'm not sure why I'm downvoted for this. Nothing about that should be controversial?)
https://www.freecodecamp.org/news/we-fired-our-top-talent-be...
https://news.ycombinator.com/item?id=15474893 (2017) (133 points | 130 comments)
Exactly. So the company keeps the guy everyone hates after laying off people that get along. The next people to leave the company are the ones disgusted by the move.
Depends on the company. I've seen the opposite case were such a person was let go, much to everybody's relief. Some people had to clean up his mess, which was genius in the sense that it worked flawlessly, but nobody else could maintain it, so he had locked in a minimal bus factor. Which makes such a move harder to execute, but the earlier the better.
Unfortunately, optimizing for not getting yourself laid off is not the same as optimizing for max productivity. In many ways, they're quite opposite.
Indeed. Like everyone from Lake Wobegon, I think that I am effective at my job. One of the most productive things I can do is to strangle bad ideas in the crib. This is not a popular role. Killing someone's pet initiative can make enemies. Yet, it can save countless weeks/months/years on doomed-to-fail efforts.
Working to not be laid off usually means just keeping your head down and going with the flow.
This happened to me. There was a layoff, I got overwhelmed with work that had to get picked up, lost motivation, and burned out.
The key takeaway for me is that layoffs are an effect, not a cause, of company failure.
The quoted text is a good example of this. If a company is struggling strategically or economically, and doesn't do a layoff, it's just going to struggle more, and fail more quickly. Companies that aren't laying people off are likely not even considering layoffs, because their businesses are actually doing well.
So, it's pretty obvious to me that companies in that cohort would see the biggest stock price appreciation, because layoffs are an indicator of poor future performance.
Layoffs are an effect of unsustainable success.
If you can lay off people without cratering the company, it means you hired too many people in the first place.
There is the question of if layoffs saved the company enough to save itself or improve? And with that data you could say layoffs by themselves don't.
Today the question is why companies making good profits are making layoffs. And looking at the damage they cause is relevant in trying to predict company performance
> And with that data you could say layoffs by themselves don't.
I think that is one inference too far? Layoffs may have saved some of those companies from bankruptcy. The Bain study is looking at share price performance and offers no data that would resolve that question.
> There is the question of if layoffs saved the company enough to save itself or improve?
They at least secured management a final big bonus for dealing with that, so management and shareholders cash in a bit on the way down.
If the layoffs are taking a company which could be stably growing to one which is going downhill - in that case the execs actually hurting their long term compensation.
But i get it, it's like junk food for execs, easy to do, crisp in the action (even if not in the effects). But consumed carelessly its bad for company health
There's a big tendency to look for culprits whether layoffs, PE, MBAs, or whatever. But a lot of companies just made wrong bets or were in the wrong place at the wrong time. Kodak was never going to survive in anything like its pre-digital form.
Yet, those who makes those wrong bets are generally paid very generously and they are generally not those who suffers from the consequences
You skipped the second part of my comment. Yes, senior execs at large publc companies--assuming they didn't do anything actually criminal or stupid related to their own finances--generally come out the other side OK. But sometimes a company can just reasonably get into a place it's hard to come out from. Kodak is a really good example IMO.
Maybe I'm expecting too much, but for me the only good reason a CEO is paid more than any actually useful employee of the company is to anticipate this kind of thing and use the money from their leadership position in the old tech to invest and not be in a very bad position with the new tech.
Sometimes companies just aren’t in a good position for historical reasons. Returning to Kodak you can’t really say to your investors and employees 90% of our existing business is toast and we’re going to churn everything over the next 5 years.
Sometimes you can do things more incrementally but other times it makes sense to basically close up shop and maybe shop your brand and some assets while keeping the biz afloat at some level with a lot of people still collecting a paycheck.
This is it exactly. Layoffs are a symptom of failure, not a cause of savings.
Also, failing companies that use layoffs to restructure can succeed. For an example see IBM in the 90s. It’s hard but possible. And since the article uses stock price as a proxy for success, IBMs stock struggled for a long time afterward. It hit an all time high in 2025.
And then there are non tech industries that just go through cycles, like oil.
IBM is up 40% from its previous 2012 high point. In the same time, S&P is up nearly 400%.
Its stock has done pretty well the past couple of years. (And it's a pretty good dividend stock as well.)
This correlation isn’t necessarily causal. Companies that are failing are more likely to layoff could be just as true as companies that layoff are more likely to fail.
Had been advocating slower hiring & targeted reductions in a mid-sized tech firm for years after COVID, but it happened much faster under a newly appointed CEO.
Under new leadership, we executed 1/3 layoffs framed as a "culture refresh" and to briefly lift the stock. It wasn't about survival, we had plenty of cash, okayish growth and fantastic ARR - more about a new corp-backed CEO adopting a "do-it-like-Elon" approach.
Being mostly Europe-based but US-led, it turned into a massive and costly process (Americans don't exactly dig EU/UK workers rights - Spain was the biggest shock), stalling most productive activity for half a year. Internal trust and brand perception tanked. Since it began with ousting old execs, it quickly devolved into a blunt-force exercise with no internal knowledge, led by scared managers with percentage targets - many good people were cut. Managers hesitated to shield talent, given the "culture reboot" framing. I ended up personally cutting entire offices.
When the CEO's broader strategy failed (for reasons beyond layoffs), high performers started eyeing the exit. Ironically, many first saw the layoffs positively - COVID overhires had left uneven team dynamics, and some dead weight was on high salaries. But when it became clear there was no coherent plan, people began leaving.
That triggered a chain reaction. Senior hiring pipelines dried up (reputation matters, esp. when your top-talent is on the way out and is loud about it), and panic set in. Eventually, it turned into survival mode. The CEO didn't last long after that.
There’s weirdly (to intuitive sense and business zeitgeist since the 80s or so) mixed data on layoffs in general. There’s a decent chance they cause more mid-term harm than good, most of the time.
They also didn’t used to be a regular feature of business.
It’s funny how such things become “ordinary” and “obviously good things to do sometimes” that haven’t always been the former, and may not really be the latter either.
Business management is vibes, trend-following, and fear of straying from the pack. And the best of that is vibes! That’s how bad it is.
You nailed it. In our case, EBITDA margins were "pencil on a napkin" at best — only because the CFO is usually the sanest person in the room. At the same time, Elon's moves and Meta's "year of efficiency" were super influential.
A lot of what happens in the boardroom or C-suite is "stick with the crowd" — e.g. template-based "tech modernization." (That's often a new CTO's hedge if the real problems are too hard. Just "go Cloud" or "go AI" for five years — four vests, one to jump off.) You broadcast confidence, you own the narrative. Which means never, ever saying "I don't know."
This is especially common in PE "turnarounds" or post-IPOs after founder exits. And it's especially harmful there because current staff is often seen as a liability, not an asset.
I thought a lot about this after the layoffs, and I think it boils down to how "professional C-levels" see execution as a commodity. They tend to overemphasize leadership (sometimes self-serving, but often genuine) and resource availability. The focus is on "what?" and "how to pay for it?" — with "how?" left to be figured out on the go.
I don't think that's completely wrong. Sometimes execution is a commodity. But not when you're short on time and planning for a rapid sprint.
> But when it became clear there was no coherent plan, people began leaving.
I see this more any more, to the point of wondering what % of execs and decision makers are actually meaningfully good at the job? When times are good, any exec action will turn out fine. But when times are tough, who is worth their salt?
And if all these decision makers are bad at decision making, what would a better organization look like?
There's definitely a "peacetime" / "wartime" divide. There's also an overreliance on pedigree. But above all, it's the pressure of being a public company (which often means losing the founder).
As a new CEO, you have to impress the board and investors without really knowing the company. You probably get two earnings calls - six months at most - to prove yourself. That's nothing, even for a senior dev, let alone an exec. And if you're being brought in, it means the company isn't in great shape - or is at least perceived that way.
You don't have time to really figure out how things work, and even if you did, it's political suicide. The board didn't hire a "looks fine to me" person. They hired a fixer. So, it turns into narrative games and rapid actions with massive tail risks.
I don't think it's a people problem. It's a system problem. Leadership replanting is hard, but it's one of the very few tools in the board's toolbox.
> Americans don't exactly dig EU/UK workers, right?
I’m actually curious to hear your take on it - what’s your experience been?
UK was horrible. No real protection for workers - just layers of mandatory legal mumbo-jumbo with zero actual chances for people to keep their jobs. It was like ripping off the band-aid 1mm at a time for four months.
Spain/France were an employer’s nightmare. Anyone without another job lined up secured a "special deal"—workers have massive leverage, they know it, and they’re actively litigious. People on parental leave had close to a year of guaranteed no-shows. The reaction was, of course, "never again" rippling across American corporate circles.
The rest of Europe was okay-ish.
US was predictably the easiest. We were generous with packages, but it's easy to see how the system can be used to screw people over.
Middle East was the roughest. Visas in UAE/Qatar expire instantly, and the local tech market is almost non-existent. We extended until the end of the school year to help with visa concerns, and some people managed to arrange golden visas. But for many, it was a massive shock — losing both jobs and residency overnight.
> Research has consistently shown he was right about layoffs: They’re damaging to companies...
The research is probably misleading. The damage was done to companies when the over-hired people who couldn't add enough value to justify keeping them employed. The layoffs are just when the damage is recognised.
It is like borrowing a huge amount of money, using 90% of it it to buy prawns and leaving them out to rot for a few days. The damage is now done, the borrowed money is lost. It won't be recognised for a while though. There is even enough left over to pay an interest payment or two to string everything along. But the damage is done.
A lot of people treat economics as though damage didn't happen unless someone acknowledges it. That isn't how it works. Not acknowledging that something is value-destructive just means more value is destroyed by the time people are forced by market forces to confront the truth.
This isn’t how all layoffs work though. Some, yes they are due to over hiring and a failure of management to plan. They are likely necessary for survival of the firm and generally last course of action. Although even those come with a cost to current and departing employees which harms the business.
But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better. Those come with a temporary balance sheet boost and all of the negative effects of any layoffs.
> But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better.
That has to be matched with a strategy of intentional overhiring though, and the damage is being done there. That is the insight that should be drawn from the research - intentionally doing something silly (in this case, overhiring) is a classic form of waste and economically destructive. Layoff or no layoff, the problem is the management team has set up a situation where they believe a big chunk of their workforce is unproductive.
This does raising the question of why boards and shareholders tolerate these clowns. To me the obvious answer being that the major central banks have a history of printing money and handing it out to asset owners, so hiring competent managers for said assets is a lot of trouble for limited gains - even weak managers are enough to drink from the money hose. But who knows, maybe the analysts think that a small amount of sillyness averts a greater problem.
>But the ones being discussed in the article are the consistent ones. The ones you do while you’re ahead to make your balance sheet look better. Those come with a temporary balance sheet boost and all of the negative effects of any layoffs.
This feels like a "no true scotsman" argument. The headline of the article is literally "Why layoffs don’t work", not "why consistent layoffs don't work". The only mention of "consistent" layoffs were when referencing Jack Welch's management style, but that was more of an attempt to argue that layoffs are bad by citing the worst possible example, than trying to introduce nuance between the types of layoffs. The studies cited also did not distinguish between the type of layoffs.
Clickbait headlines aren't anything new. While a better headline like: "How the Layoff Culture that Started in the 80s and Spread to the Rest of Wall Street is Actually Harming Business's Long Term Prospects" would be better, punchy headlines like this one spur clicks and conversation as seen by this thread.
I believe we took different things from the piece and I imagine you'd disagree with my better headline. I understood the piece to be telling a story starting with Welch and Dunlap of how layoffs as a way to improve numbers actually damage those same numbers in the long term.
> But the ones being discussed in the article are the consistent ones.
I worked at GE when Jack Welch was there. First of all we never had a systematic firing of the bottom 10%. That is a myth. We ranked everyone each year and clearly identified the bottom 10% but they were not always fired. The manager did have to have a development plan for these individuals.
More importantly, GE did have consistent layoffs. I assert this was a good thing. I vividly remember asking an EVP at GE Capital when I first joined GE why we did this. It seemed inhumane. Wasn’t it better to try and fix the so-called ‘C’ players? His response fundamentally changed my view on hiring, leadership, and firing. He told me two things. 1) Hiring people is always a gamble. The best interview/onboarding processes will not produce 100% success. There will people that do not have the skills that are needed. There will also be people for whom GE is simply not a good cultural fit. 2) In good times, when a GE business unit is doing well, they always over hire. People working 50 hours a week want to work 40, process problems that have built up need to be addressed (similar to tech debt), etc. Over time this leads to bloat and inefficiency.
For these reasons, consistent layoffs make sense for the company. They also make sense for the employee. By not waiting for an economic downturn and then making dramatic cuts, the exiting employees would have an easier time finding the next job as odds are the economy would doing well. Particularly in the case where the person was not a good fit for the GE culture, they learned this and could find a better fitting role elsewhere. And GE was great on the resume back in those days (sadly not so today). If we waited for the downturn, then the exiting employees would be looking for a new job in a bad economy with everyone else who had just been laid off. Not a good situation.
Finally, an additional point I learned later by observing when and where we made headcount reductions. GE made many bets on new markets, new products, etc. We had to if we were to grow by 10% each year (GE Capital’s rigorous requirement for business and strategic plans). The successful GE leaders understood is was easier to grow revenue to achieve 10% net income growth than to cut expenses. Unfortunately, not all new business ventures worked out. In those cases, we had to make a decision to shut them down (all new ventures had off-ramps). As a result, some people were repurposed, but others had to be let go. I posit that is consistent with the tech approach of “fail early, fail often.” In industries with significant people required to try a new approach, the consequence of failing will be layoffs.
I don't see much reason to think mass layoffs are typically the result of over-hiring rather than a reaction to changing circumstances that are different than when the hiring originally happened. The article opens with a perfect example, the constriction of the US air travel market following 9/11. The people most airlines fired as a result weren't "over-hired". Their hiring made sense at the time and they were fired when circumstances changed. I'd argue this is likely more often be the case than actual over-hiring, since it's easier for a company to see if they can actually utilize new employees now than it is for them to predict the future.
In cases like that, the layoffs really do seem likely to be damaging to the companies. If circumstances change for a company and they can no longer effectively use all their employees, the most obvious solution is to get rid of employees, but it then makes it far more difficult to recover when positive opportunities present themselves. I think companies trick themselves into believing that since hiring and firing employees is relatively quick, it's a good tool to adapt to changing circumstances in either direction. But that ignores the time it takes for a new employee to become fully productive and the increased difficulty/cost in hiring new employees if your company has a reputation as an unreliable employer. It also ignores the potential boost to productivity that can come from employee loyalty and job satisfaction and security.
The latter points are true. But it's also the case that radical reskilling for very different job roles (with possibly rather different market salaries and, honestly, different from many people's job preferences) is tough too. Probably hard to come up with reliable rules.
I have tried and failed to understand what is meant by "layoff due to overhiring", in the context of Software Engineering. When an engineer is employed in a successful project, they are incredibly profitable. A handful of engineers can write and maintain products worth millions of dollars. Big companies, which are the ones we discuss when talking about "overhiring" should be capable to find or create projects where an engineer will be at least modestly profitable. And having an employee creating a small amount of profit, who might eventually be moved to something that's better, is certainly more profitable than firing him and paying severance.
Note that here I'm talking about firing good performers because you have "too many" of them. Firing bad performers because the estimated cost of training them is not justified, I can understand.
The only explanation I found satisfying is that investors heuristically care about profit per capita(ppc) as well as total profit, and employees who don't produce _enough_ profit reduce ppc and thus investment to point the opportunity cost of firing them aligns. You'll make investors happy, which will raise valuation, more than what you are losing from the lost profit. But this is not "rational" in a full information economic sense. It's essentially the company virtue signaling that they are capable to fire if they had to, even at the cost of actual dollars.
> A lot of people treat economics as though damage didn't happen unless someone acknowledges it.
This is what I call the TV effect. People are trained from an early age, by consuming media, to only construct what is "real" by what is announced. And it's not just economics, but all sorts of aspects of life.
Is it not incumbent on the company who hired the employees to ensure they are utilized sufficiently? Why imply it’s the worker’s fault for their own mismanagement?
>Why imply it’s the worker’s fault for their own mismanagement?
I'm not sure how you got the impression that OP implied it's the worker's fault. If during the 2021-2022 boom, some startup hired a bunch of junior programmers for $200k/yr, I think describing those people as "people who couldn't add enough value to justify keeping them employed" is a fair assessment of the situation. It doesn't imply that it's the junior programmer's fault, any more than it's not my "fault" if I'm asked to play a musical instrument with no prior experience, it sounding terrible, and people asking me to stop.
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This all sounds like the post-mortem justifications of a sclerotic executive suite.
This would be more true of management did not play BS with the numbers constantly.
I worked at a firm that for 2-3 years straight would report great Q1,Q2,Q3 numbers.. tell employees it's looking like a good year. And then Q4 report a total wipeout loss that negated the quarterly earnings and swung the company to flat or a loss. Whoops, sorry, no raises, cutting bonuses.. and need to do some layoffs.
Behavior like this reminds us that the numbers are not real real in a scientific sense, but only in a relativistic accounting sense.
Similarly when goals are linked to earnings and the company reports adjusted earnings... So changing the earnings by disregarding some expenses or some sales out of the calculation. The one in charge of this adjustment can play to allow or dismiss bonus for the year.
And to top it all off executives never have to eat the shit they caused in the same way the rest of the workforce at the company ends up having to
Some people will really do a lot of mental gymnastics in order to consistently blame workers instead of laying the real blame on poor leadership for company failures. If your company is failing because Tammy isn’t a “rockstar” at her job, you have a terrible company.
You don't know what you're talking about. People are fired when they can't add enough value to justify being employed. Sweeping industry-wide layoffs are different. Eg the "damage was done" to the aviation industry in 2001 due to plummeting demand, due (obviously) to new fears and hassle inhibiting travel; the damage currently being done to companies in the economy is from interest rates, inflation, trade uncertainty, stock manipulation, ...
> You don't know what you're talking about. People are fired when they can't add enough value to justify being employed.
That depends upon the employer. Layoffs occur for a plurality of reasons and the persons selected for termination are selected by various different criteria that may include quotas or random selection.
Look, honey, another nerd who thinks the meritocracy is real! Get the camera!
'The research is wrong because I said so' isn't exactly a compelling argument, and certainly not a strong enough one when you've been in the modern workforce long enough to recognize how badly layoffs are conducted at just about every company. I've seen enough 10x engineers get laid off to know that the idea that companies have any idea as to who is actually productive or not is just false.
1) But I included an actual argument and, furthermore, it assumed that the research is correct.
> I've seen enough 10x engineers get laid off...
2) That is sensible for the company. They have no idea how to use a 10x engineer, as can be detected by the fact that they're having layoffs. They don't know how to create value in the market and they're being forced into a position where they have to squeeze what they can out of what assets they have.
It isn't economically rational for them to employ 10x engineers in that sort of environment. The global and local optimum is to let those engineers go so they can do something valuable somewhere and keep some more 1x style engineers on the cheap.
If a company is having layoffs, that is the invisible hand of the market writing on the wall "THIS MANAGEMENT TEAM DOESN"T KNOW HOW TO MAKE MONEY AT THE MOMENT, STOP GIVING THEM IMPORTANT RESOURCES". That includes 10x engineers.
Unfortunately as I've seen countless times, it's also writing on the wall to the management team "TIME TO MOVE ON CAUSE DAMAGE TO ANOTHER COMPANY", I don't know why we don't expect management's head on the chopping block. If a captain orders a course into an iceberg, idk why we can't just hang the captain and course correct.
That's how I feel about it too, the times I've been around layoffs management and the executives all talk about a difficult economic environment and making the organization leaner by firing a bunch of IC's. Never once have I seen a C level say hey we steered the company in the wrong direction its time for new management or hey our CFO failed to communicate the economic environment and caused us to overspend so we're going to look for a new one.
I know it's ridiculous to expect them to blame themselves but the fact that we just accept this lack of accountability from executives/management in the corporate world is insane to me.
Execs go on to "pursue new interests" or "spend more time with family" all the time. They may get pretty good packages to do so but it absolutely happens.
Because the captain owns the ship. Or is the best buddy of the person that owns the ship, and can blame subordinates in closed-door conversations.
Because nobody orders hanging themselves.
> 2) That is sensible for the company. They have no idea how to use a 10x engineer, as can be detected by the fact that they're having layoffs. They don't know how to create value in the market and they're being forced into a position where they have to squeeze what they can out of what assets they have.
Okay, now explain why every company is encountering these issues where they're frequently laying off people and are unable to create value. The frequency of layoffs is diametrically opposed to your thesis because otherwise companies would behave in a way to reduce layoffs. Such as hiring fewer employees and encouraging longer term retention.
> If a company is having layoffs, that is the invisible hand of the market writing on the wall "THIS MANAGEMENT TEAM DOESN"T KNOW HOW TO MAKE MONEY AT THE MOMENT, STOP GIVING THEM IMPORTANT RESOURCES". That includes 10x engineers.
This is basically the Just World fallacy but applied to the free market. If something occurs then it's justified as a perfectly rational action of the invisible free hand of the market. In reality layoffs are rarely conducted by the people most equipped to do them, but via a mandate from heaven that you must cut your team for the sake of Number even if you're one of the most efficient teams in the company.
> now explain why every company is encountering these issues where they're frequently laying off people and are unable to create value.
Creating value is hard.
Seemingly executives being held accountable is even harder, as it rarely happens
Edit: Please reply with concrete evidence of widespread accountability of executives
Mmm maybe they shouldn't have hired them in the first place then. Ever think of that, you miserable waste?
I remember hearing a take on layoffs that I think is pretty true: When you fire the bottom 10%, you lose another 10% who are from the top performers. The destruction of psychological safety for everyone at the company is irreparable, and you start to bleed your most productive talent, too.
I've seen this happen. I worked at an extremely efficient company that had a great product. We got acquired, and within months, were part of the acquiring company's yearly mandatory layoffs. They fired a bunch of (apparently random) people to meet the quota. This absolutely destroyed us. Morale was just gone.
Within six months, about a quarter of our employees, mainly top performers who could easily find other jobs, left voluntarily.
The whole thing self-destructed within another year, and the product we worked on was abandoned.
>yearly mandatory layoffs
That sounds grotesque. Who would choose to work at a company with that sort of bullshit dangling over your head?
Tons of people have gone to work at companies with various stack ranking schemes. Most people need jobs.
Enron was famous for this. Supposedly it's a practice that Jeff Skilling learned at Harvard business school, where the bottom 10% were flunked no matter what their absolute GPA was
I mean, being homeless kinda sucks.
> had a great product
> We got acquired
Can I just ask about the reason for this? Was it owners wanting off the ride?
Owners made half a billion and got high-ranking positions at the buyer.
Buyers bought it because they had a very specific problem that the product was designed to solve, and thought that it would be a competitive advantage to deny the solution to their competition. On paper, it was a good decision.
Classic capitalist efficiency right there.
Why do you lose 10% of your top performers?
I don't know if I'm a top 10% employee, but I'll share how layoffs influenced my decision to leave a job of 5+ years. I started looking for a new role after they announced the layoff of about 200 people in my organization. When I finally got an offer, I kept going back and forth on staying and negotiating or accepting the offer. There were many other reasons why I left, but a huge factor were the layoffs. I just kept thinking, they already had layoffs, what's to stop them from laying me off next? It's also a crappy feeling thinking that you/your team can be on the chopping block at any time.
Top performers have options and value stability. They also know that they rely on their manager to accurately reflect their work up the chain.
Some percentage of top performers report to deadbeat managers, so in an environment doing mandatory layoffs, they'll know that it doesn't matter how much they knock it out of the park, their manager will screw them. So of course they'll leave.
If you're a top performer stuck under a deadbeat manager, how are you able to signal to new companies that you're a top performer?
I read posts here all the time about how hard it is to hire. How do top performers distinguish themselves as they go out for new jobs? When did this become easy?
> How do top performers distinguish themselves as they go out for new jobs?
During an interview process, and by using your network. Top performers aren't usually slinging applications through LinkedIn in my limited experience
> When did this become easy? It isn't, they're referred to as top performers for a reason. It's easier for folks who excel in their fields, and that holds true across domains.
The secret is that top performers are hired by word of mouth, they don't go through the usual processes.
As others here are saying you know the right people. Which is probably a pretty unsatisfactory answer and seems very unfair for those who don't.
Because disloyalty breeds disloyalty and distrust breeds distrust.
The top people have the best opportunities elsewhere, so they leave first.
Even if they don't quit outright, they are likely to quiet quit, because why put in the effort when it is rewarded with disloyalty?
Because people will often see people who they don't perceive as low performers getting lumped in with 'low performers' and laid off. At that point, you start looking for management that seem to know what they're doing.
But only top 10% start looking?
This all sounds like a hand wavy hypothetical.
Everybody starts looking, but it’s the top performers who get disproportionately more offers and leave.
https://en.wiktionary.org/wiki/Dead_Sea_effect
Because they have a good chance of hiring a better employer and will either do that or stop being your top ten percent
because they see the company struggles and is not loyal, as top performers have plenty of options they will be more likely to take a better offer when it comes along. Top performers will not leave the same day but bleed out over a bit longer timeframe. The most popular example is woz hesitating so much to leave HP because HP was loyal to employees and woz was loyal to HP. Imagine the same situation when HP had just let go 10% of employees, he would not have thought about it twice.
Top performers are generally pretty sharp. If they recognize the company is struggling and decide they have a better future elsewhere then that’s where they’ll go.
Anecdotally layoffs leave a bad taste. I worked at a smallish company that laid of 20% going into covid and within 2 years most of the best talent churned out.
It gutted moral, basically.
I have only ever quit jobs in response to layoffs. Layoffs demonstrate to me that the company is apparently low on cash if they need to fire people to make ends meet. If they are not low on cash, it means that they will arbitrarily fire anyone in order to pump up their stock.
Though I've never personally been laid off, it's a black mark on the company that I think you can never recover from. It means I will never trust anything said at a quarterly all-hands. The projections they give us employees are spun to be more positive than they really are.
During COVID, my company told us that we were going to be able to save money by breaking the lease on our office building and stop paying for amenities like the snacks in the break room and catered lunches (since nobody could use them anyways). This, they said, should save us enough money that we don't need to lay anyone off!
10% of the company was laid off a week later. The next day, I would later discover, the company applied for a PPP loan: they had laid people off pre-emptively so that they wouldn't be penalized for it next year when they sought to have their PPP loan forgiven.
It illustrated to me that you can't trust leadership, ever. Once a company initiates a layoff, it's a permanent black mark on that company
I think because - if you fire a poor performer, everyone kind of gets it - they weren’t doing a good job, they’re a drain on company resources, they’ve got it coming, basically.
But lying off isn’t firing someone for performance - it’s admitting “we don’t have enough money to pay you”
And that’s something that should be scary to everybody in the company.
When your shitty coworker gets fired, you shrug and say, yeah, saw that coming. When your shitty coworkers get laid off, you look around nervously and think phew, l lucked out.
I don't think its only psychological safety. If the top performers lose staff that did the mundane crap and now they have to do it they start to really pay attention to what the management is actually doing.
Every layoff I have ever survived the staff inevitably ends up talking about how so and so manager and his favorite buddies are still out golfing every friday. Why the f are they still here etc.
This resentment builds and builds.
Companies churn through people constantly. Google famously has an employee tenure of like a year[1]. Most companies that subscribe to the Jack Welch "fire your bottom 10% yearly" philosophy don't usually declare a media stock-pump "layoff" but are just letting go of purported non-performers constantly. And there are a lot of "top 10%" performers who are very happy that the so-called deadweight isn't kept around just for some foolish notion of "loyalty".
Sometimes layoffs are unfair, and sometimes the wrong people are let go. But often it's entirely necessary and the right people are let go.
[1] - Which makes the whole gruelling, multi-month hiring process positively ridiculous. It would be much better for this industry if companies hire fast and fire fast, instead of delusions that they're finding the magical employee base that will be with them forever.
The Google tenure stat is misleading because it was taken at a time when the company was growing 20% per year. The actual statistic worth looking at was how long a person who is leaving had been with the company on average at the time of leaving or what percentage of the overall headcount leaves per year. While I don't feel comfortable sharing those numbers, I can confidently say they lower than the industry norm.
The industry norm is incredibly short tenures, and often when it starts increasing, it's paradoxically when the company is on the track towards complacency and eventual failure.
https://www.inc.com/jeff-haden/why-googles-high-turnover-rat...
This isn't some Google specific thing. The cargo cult "look at our super exhaustive, endlessly demanding hiring process" is a farce everywhere. It's actually a bit paradoxical because it actually selects for employees who don't want to actually stay with you, they just want to be able to say they were willing to endure your gauntlet.
Perhaps in your segment of the industry.
I’ve worked in places where people stuck around for years because they believed in the company and technology and wanted to successfully ship a product. In fact, I still view repeated 18-month stints as a bit of a red flag.
It’s a big industry. There’s a difference between a norm and something that a sizable subset of people do.
I think if you look at companies like Citadel, which routinely fire the bottom 10% as part of the job description, it attracts a certain set of people who actually do feel "safe" in that environment. The trouble comes when you break your norms about layoffs.
Also, Google's median tenure of <1 year was due to hiring, not employees leaving. In other words, that number included people who hadn't left yet. I think if you look at people leaving Google, average is about 3 years.
>Also, Google's median tenure of <1 year was due to hiring, not employees leaving
Google would have to be growing at >300% per year for this math to make sense.
But even if it's 3 years ({X} doubt), that's still cartoonishly low for a hiring process that drags on for months and months.
>I think if you look at companies like Citadel, which routinely fire the bottom 10% as part of the job description
Almost all tech companies target firing/pushing out a considerable percentage of employees per year. It actually is incredibly common, even if it usually doesn't make the news. They used to do it overtly via stack ranking, but now they just do it more quietly. Microsoft punted 2000 "low performers" in the first two months. Brutal firings with zero severance, immediate cancellation of health coverage, etc.
I’ve been through several waves of corporate layoffs across many industries.
Some observations:
1 - It’s rarely one round.
2 - Companies tend to be the most thoughtful on the first round. Then it looks easy and the precision (and severance) of future cuts goes down. That’s why it’s smart to take a voluntary offer.
3 - Cuts that are broad based (“Every department cuts 15%”) are a sign the company doesn’t know what’s going on or prefers harmony over hard choices.
4 - Layoffs can be a crutch for firms that don’t do performance management. (Less work to do a layoff than have managers counsel bad performers out)
5 - Managers should never promise “No layoffs”
Former Nintendo CEO Iwata said something similar:
“If we reduce the number of employees for better short-term financial results, employee morale will decrease,” he said. “I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.”
They used to be a once a decade "save the company during a recession" move. Now they seem to be a quarterly "manage earnings per share" move.
software development costs are out of control the whole industry is one big grift, there’s no accountability anywhere, 20% of the devs are doing 80% of the work, the business would instantly terminate the 80% for cause if they could only discern the difference, but they can’t, because the business side is also a big grift with the exact same problem all the way up to the founders recursively
Got news for you.
It’s not the devs who are bloating development costs. It’s the layers of management making hour long meetings to discuss button placement.
It’s the hours of retros, design meetings, and skip-levels designed to remove any personal investment or sense of ownership from everything.
Since so few individuals are trusted with real decision making power, you need a lot more people to achieve some kind of consensus/buy-in so that you can ship anything.
The devs are at the extreme bottom of this totem poll.
It’s like blaming construction workers for houses being expensive.
And, ofc, that goes without mentioning the multimillion yearly bonuses for C-suite, but we can just forget about that and blame the lowest ranking corporate employees (devs)
Source: I worked at a large tech firm for many years and saw this over and over again.
Right every step of every dev task is ticketed, scheduled and measures within a millimeter of its life in many orgs. The people working the tickets aren't to blame when it all goes wrong in the big picture.
I've worked at shops with agile coaches, consultants, product teams, multiple management layers, etc all attending agile planning/retro/blab sessions. They always had really strong opinions on the minutae of each footstep (tickets/sprint), but couldn't speak to where the path was to take us. Essentially zero quarterly let alone annual planning.
A lot of management these days is the equivalent of driving and saying "I'll decide where I'm going when I get to the next stop light", repeated every 2 weeks.
> I'll decide where I'm going when I get to the next stop light
Surprisingly, this type of iteration can actually work; but the caveat is that the people behind the wheel, and reading the maps, need to be very good, and also, experienced enough to make sound decisions. If mediocre (or inexperienced) people try it, it’s a disaster.
From what I can see, the entire tech industry has been institutionalizing mediocrity, so this type of approach is not really available.
It doesn’t sound like the type of iteration matters at all.
If your leadership is good and competent, they can drive the company any way they feel and have it work.
The most productive I’ve been in my career was when my PO put all tasks that needed to be done in a Google sheet and the whole dev team spent a week just picking tasks off the list. It ended with us shipping our app on time.
No planning, no grooming, no nothing. It was a high trust, high ownership team.
I miss those days.
Generally you see stuff like this turn into bikeshedding and/or sales features only. Way too often I see companies push for new features because they will generate sales that in the long run cause more customer loss because performance and stability was neglected to implement them.
That's because it's done by folks not up to snuff.
Lots of that, going 'round, these days. Companies are firing (or driving off) all the people that can do it right.
Right
If you’re copying this approach from someone who copied it, after hiring an agile coach and reading the phoenix project, you are likely definitionally mediocre.
Also it’s not a one size fits all solution even for the competent. Requires a more direct interface and two way dialogue with users than most devs actually face.
Second that, scrum teams having 3 business analysts, scrum master, product owner, ops/it, ux designer, 2 testers, 4 developers is basically how it goes.
Blaming developers in such scenarios is silly.
I agree with your point but at the same time developers do need to be managed and they don’t want to manage themselves
I’m not saying just leave everyone to their own devices, but some individuals should be able to have ownership and make decisions without layers and layers of process.
Ofc decisions can have consequences, but that’s what the high pay should be for.
It’s not a black and white issue and I don’t think you need to present it like one.
A more risky job should be compensated more ? It'd be the opposite, if it's risky then the variance of the income should be greater (success = more income)
I don't want to present the problem as black and white but merely express a simple idea : developers DO want to be managed to simplify their lives and focus their time on more important things for them
It’s the devs too. Do you really need an army of developers to build a web app or put text onto screen? No, a small team can easily handle that much faster and at higher quality without all the framework bullshit.
You also have to consider that developers are not sales people. They are a cost center.
Heh, and there's at least one FAANG where it's not even the layers of management.
They've just removed a huge amount of manager discretion and initiative through multiple top-down dictates that are pretty much killing any low level desire to really innovate and try risky initiatives.
IBM, but with same level product market fit as IBM had for its mainframes, but in this case for markets 100x more important for the global economy.
It's just sad.
Got news for you, too: it's both. It's the useless management, it's the "developers" who send me screenshots of stack traces while they cry and soil themselves because they have no clue what they're doing.
The big tech companies paying the largest salaries are raking in billions in profits. How does this square with the view that software development costs are out of control?
Layoffs today seem more like execs following management fads for easy visible actions and this data would suggest that the actions are actually detrimental to company profits. Juice the numbers for a quarter but add another long term drag to the company
Just because a company can be overall profitable doesn't mean costs aren't out of control. If you make enough profits, you can literally feed money into a shredder and still come out ahead if you earn profits faster than your shredder can eat them.
What you're describing isn't out of control, all businesses have income and expenses, good management is watching both sides and building the organization that connects the two in the middle.
Sudden drastic moves if the business is delivering profits seems like the out-of-control action to take. If the business salary structure is off, or if you need to a different skill mix there are ways to shift that in a profitable business without sudden layoffs damaging the very organization that delivers your current profits.
So maybe we don't take jobs away from people with families and mortgages then, if all we have to do is sacrifice some profits, yeah? Gee, maybe the company can only make $9 billion instead of $9.5 billion, and everyone can stay employed.
Good lord I’m not sure I’ve ever heard it put so succinctly. Well done.
The twist is that when you layoff the 80% who supposedly only did the 20% part, you pretty much still have to hire the same amount of people to do that 20%.
But with lower rates, and with abysmal rampup period (or even afterwards).
Don't blame managers, they just follow money, why else would they work those crappy jobs. Blame idiots who think short term bonuses should be massive instead of some long term performance and investment of oneself in company's success.
Blame the board, full stop. "Follow the money", there is really no other possible answer. Some set of people are responsible and to determine who that is, you read the corporate ledger, you read the financing contracts, you read the bylaws and governance structures, and what they literally state is that the board of directors are responsible for directing the company. The board is responsible. If you wish to be a director and responsible, then go incorporate, now you are the board! You are responsible! Good luck!
Then by the same principle, don't blame the devs, they are just drifting as most people would do.
So much of the software industry is just an outrageous combination of inexperience and "YOLO". Every problem can be solved by just giving AWS another $100,000 this month because we don't have time (and don't know how) to make even basically optimized software. So just burn the gas and electricity and give more money to the YAML merchants at Amazon.
I still have PTSD from around 2012 when a company I worked for and loved very much (chumby) imploded financially and almost all of the employees including myself got vacuumed up in an acquihire-type deal into a streaming media company that was building a would-be netflix competitor.
Us former chumby developers were working primarily on the front-end across a variety of embedded-system-like devices (writing code for early versions of 'Smart' TVs from the likes of Vizio, etc) while another team was creating the backend and whenever they would show us the infrastructure diagrams of what they were working on they would just place a "HADOOP Server" wherever they had no idea how they were going to solve some large difficult problem, it was effectively a stand-in for "magic happens here".
Got to the point where there were a hilarious number of layers upon layers of little cylinder icons in the system design titled "HADOOP Server" all interlinked in non-decipherable directed graphs.
I'm pretty sure every single one of us left the new company within 6 months, I lasted about a month and a half.
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And, of course, you can site a reference for those statistics. That aside, I don't agree with your overall sentiment.
> the business would instantly terminate the 80% for cause if they could only discern the difference
There's many many companies and leadership who want their big empires of people. I'm not too sure they want to fire 80% or be more efficient.
I'll start to call this mindset the "DOGE mind-virus": "80% of workers are doing absolutely nothing and can be cut with no repercussions whatsoever". Sure buddy.
Well, it worked for Twitter. Lots of people screamed that Twitter would implode withing 6 months, after the massive cuts. There was some scrambling for a while, but I haven't noticed any issues. In fact, they've added tons of new features and Grok AI (which is much better than competitors).
Last I heard Twitter is so desperate they've resorted to suing former customers who stopped buying poorly performing ad space.
Edit: removed supposition
This has nothing to do with the tech side of things though? In fact the business was always on shaky grounds even before the acquisition.
From a tech perspective, the company was indeed massively bloated with tons of people clearly not contributing anything.
There go the goal posts, whooshing by at the speed of sound.
My understanding is that twitter's struggles are/were a result of advertiser and customer boycotts, not site functionality.
People were aghast at the brutality of the layoffs, and ideological direction. However, my impression was that there was in fact a tremendous amount of bloat.
They fired all the mods and sales reps, so the company no longer makes money because it can't sell ads.
They mostly haven't added new features either, just turned on some flags for features in testing.
They also removed old features. Or can we look at threads without being logged in? It's clear people who say Twitter didn't change don't remember at all what Twitter was like.
If by worked you mean steadily losing users for the first time in the history of the platform and a 0.2x of the company's valuation, then sure. That worked.
And what's that about Grok AI being better than the competition? I think I misheard.
Running a business is less and less about actual business outcomes and more about juicing stock. And the stock market itself is divorced from reality as companies whose output has gone down over time sees higher valuations because the owner has cult appeal. So everything gets worse and more expensive year over year while feckless suits get sloshed over company dinners.
The stock market is like a sports betting pool where the players are allowed to bet on themselves
The stock market is just a predictions market, and any predictions market at scale destroys the subject of its prediction.
Can we have a different kind of stock market which forces participants to consider long term outcomes more? E.g. no HFT firm should be able to make a profit from such a stock market. Selling stocks earlier and often should result in a penalty or percentage being taken away as a fee. As a retail investor I would love to use invest and forget strategy based on trends observed in such a stock market.
>forces participants to consider long term outcomes more
I remember many years ago telling a senior executive that I had concerns that some of the steps we were taking to boost current quarter financials would negatively impact business performance in the long term. He just chuckled and said, "there's no such thing as the long term, only a never ending series of current quarters".
>E.g. no HFT firm should be able to make a profit from such a stock market. Selling stocks earlier and often should result in a penalty or percentage being taken away as a fee.
Maybe by "HFT" you only mean "those evil hedge funds that are pushing companies to chase next quarters' earnings", but there's nothing fundamentally wrong with high frequency trading. Market making[1] is high frequency trading, and basically involves offering to both buy and sell and given stock, and pocketing the spread. That increases liquidity, making it easier for other traders to buy/sell stock without taking a huge loss. It's unclear why you'd want to ban this, or how you'd distinguish this from whatever evil HFT you actually want to ban.
[1] https://en.wikipedia.org/wiki/Market_maker
I am not saying HFTs can't sell but there should be penalty for higher frequency. It means they have to craft algorithms which will take longer term view of stocks (and their fundamentals) rather than ignorance of other participants
Market makers make fractions of a percent per trade. How will your "penalty for higher frequency" deter traders that prey on "ignorance of other participants" or whatever, but don't put market makers out of business?
Easy, bye market makers! It's like a layoff, some good will end up getting culled with the bad.
All these HFT stuff reminds me of chinese event where people send each other gift money as a good will gesture. Revenue is high but no meaningful transaction has happened. The money is just being exchanged between the same top HFT firms. And the best of our minds are fighting it out in the arena of algorithms rather than creating real world value.
>Revenue is high but no meaningful transaction has happened. The money is just being exchanged between the same top HFT firms. And the best of our minds are fighting it out in the arena of algorithms rather than creating real world value.
Liquidity is "real world value". Being able to buy/sell a stock instantly without a massive premium/discount makes stock ownership for the average person possible. Contrast this to an liquid market, like buying houses, where you need to spend months house hunting, and pay a 6% commission on top.
https://www.ecb.europa.eu/press/research-publications/resbul...
Conclusions and policy implications
To return to our initial question: does stock market liquidity deteriorate when HFTs compete? The results suggest that competition among HFTs increases speculative high-frequency trades, which could lead to a deterioration in market liquidity.
Taking the study at face value, it only says that competition among HFT is bad. It also specifically admits that "As market-makers, they can update their price quotes fast when news arrives and provide liquidity to the market. In this case, the low-frequency traders in the market – the investors – benefit from lower transaction costs". In other words, at best it's advocating for some sort of monopoly for HFT, rather than getting rid of HFTs entirely.
It's not really high frequency trading in the sense of day trading, it's a bit of a misnomer. I would say it's actually low latency trading, the number of trades isn't huge. It ensures that linkages in the market operate quickly. Linkages between a stock price and its respective options. Or linkages between an index ETF and its components. The price discovery process should be fast, it benefits all of the market participants.
https://www.ecb.europa.eu/press/research-publications/resbul...
High-frequency traders (HFTs) are market participants that are characterised by the high speed with which they react to incoming news, the low inventory on their books, and the large number of trades they execute. All this is possible for HFTs because they use automated, algorithmic trading, which enables them to analyse markets and execute trades in under a millisecond. The high-frequency trading industry grew rapidly after it took off in the mid-2000s. Today, high-frequency trading represents about 50% of trading volume in US equity markets. In European equity markets, its share is estimated to be between 24% and 43% of trading volume, and about 58% to 76% of orders.
Benefits how? Even if we are all 'market participants', the time investment between a hobbyist and career investor is rarely equal. An LFT/low frequency trading market would egalise this discrepancy.
Consider no stock market. Just keep the company private.
Honest question, why do so many companies strive to go public?
There are other places where people can gamble
Access to large pool of capital
This subthread is nonsense. As a retail investor, HFT is good for you and lowers your prices. They have a bad reputation because of the book Flash Boys… but basically nothing in that book was true.
What is the long term effect on accuracy when a large mass simply moves XX% of their monthly paycheck into top ETFs?
I don’t disagree with what you said though, simply sharing thoughts - I think it leads to markets being more sensitive to macro strategies rather than actual fundamentals
>What is the long term effect on accuracy when a large mass simply moves XX% of their monthly paycheck into top ETFs?
Such investments are typically market cap weighted, which means their effect on stock prices are neutral. Moreover there's still room for hedge funds (and other sophisticated) investors to engage in price discovery.
> where the players are allowed to bet on themselves
Wouldn't that be insider trading? You can't short your own company before announcing bad things to make money from it.
If you think the rich people haven't invented a way around those pesky "rules"...
Well people are also betting on themselves in sport betting so if we account for ignoring the rules, I don't see why the qualfiier that betting on yourself is allowed would be needed.
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Shareholders are expecting layoffs now, it’s kind of sickening.
I think it is because most companies stopped firing.
> Companies must invest to train current workers to pick up new tasks — and invest to recruit replacement employees after the economy improves or the company’s financial troubles clear up.
It always baffled me how could a businessman fail to understand that loosing a reliably working employee (even of mediocre productivity) is like shooting your own leg - resulting in having to look for a replacement, train them and hope (certainty is value worth money as well) they are going to be as good. To me it seems it is always better to increase the wage to avoid losing people already working for you so you save yourself from the hassle.
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Having lived in the Boise (Idaho) area, I saw this happen over and over with Micron and HP. I knew dozens of people who had worked for one or the other (and sometimes both) and were then let go in those companies frequent mass layoffs. One person I knew had been laid off → rehired by Micron 3x in the span of 10-years.
I think the biggest issue is that it is far too often the _first_ tool that companies reach for, instead of the last. Oh, the market feels unstable? Better cut 5% "just to be safe". There's a national event that might impact our business? We're going to drop 10% of our employees before we know anything.
While it certainly doesn't apply to every company, I wonder what it might look like for executive leadership to make a pledge that it always comes from the top first: The leadership team agrees that it will take a (public) $X financial cut for N months in the event of a layoff-level event/period to help guide the ship through the storm (with compensation on the other side). If it works, you have the loyalty/respect of your employees. If it doesn't, you do the layoffs anyway and those who remain know that you tried.
In Europe where most countries are notoriously hard to fire people they don't do layoffs like that "just to be safe", they instead just cut-back on hiring more people during though times.
It has an impact of morale, but not nearly as bad I imagine. I wonder if that is one of the reasons why Europe companies tend to be smaller companies, while US tend to be bigger. Expansion is easier when you can fire at any time, smaller companies are more likely to succeed if they don't over-hire and keep talent around.
I don't know whether it's a reason for size ("one market" isn't just about taxes, it's also about culture and language, and that's more different in the EU than the US), but it definitely makes companies more risk-averse towards expansion and disadvantages people with non-average backgrounds. The risk your CV suggests (e.g. mental health, unemployment, non-traditional career) gets multiplied if it's close to impossible to fire you.
"Kelleher wasn’t around to see them. He died in 2019."
That's how it works. You have someone who is a great leader who started a company and treated their employees well, then the behemoth corporation waits for them to die to start gutting their values. It happened at my company. It's basically just a lite version of a private equity takeover.
The layoffs are not the issue. It is the decision makers who took the two decisions to both over-hire and then mass-fire shortly after. GM is a great example. The company was the largest and one of the most innovative car manufacturers in the world. It doesn't stand a chance against BYD today and it is not by a lack of money (though maybe with a C-suite change).
So my opinion is, yes, the damage is done (or being done) but like GM, it'll probably take 10-15 years until we are in the visible territory. Maybe a bit shorter because this is tech.
GM is a great example, Intel as well, that its rarely the engineers fault. You can have great talent but if management is dead set on bad decisions over & over, theres nothing to be done.
And the decision to overhire/overfire, set bad strategy, etc all resides in the C-Suite who rarely fire each other or themselves when it all goes wrong. It's only the employees that suffer for every mis-step.
> It's only the employees that suffer for every mis-step.
They benefit for the overhiring mis-step.
Not necessarily. If you give up a good job to join a firm that has over-hired, its only obvious in retrospect that you took a bad risk.
This hits home. I wish there was a way to gauge “retrospect” before actually suffering from it. I’m now usually quite weary of “we’ve had to get yet another loan of 60 mil, after 6 years in business because we don’t know how to make a profitable business” also known as a series C or whatever.
I don't work full-time for startups, because of this. I was contracting for a startup last summer for about 6 months. They paid really well, but after researching the company, they were on their 3rd round of funding. The estimated yearly profits were a sliver of this, meaning they were burning through VC money hoping for an acquisition or somehow massively increasing profits. The product was also in a very crowded space with lots of competitors.
They had 3 other contractors working on the same functionality and they were all let go within a couple of weeks, because I could get it done 2X faster and without many integration issues.
I would have gladly kept working as a contractor, but when I refused a full-time work offer, they cut all contact off with me.
I would talk to the FTE frequently and they were always overworked and on multiple teams.
These are great because often the founder managed to take money out at one round of funding or another and is insulated from downside.
> one of the most innovative car manufacturers in the world
Off topic, but I'd like some more specific thoughts regarding what you are aware of for specific automotive technologies that GM has innovated over the past decades, to make this statement.
Intuitively, GM cars do not do well internationally, have been known to have creaky interior build quality, have silly features like turning the reverse lights on when you unlock the car in a parking lot, and are not competitive on a scale of luxury compared to their European and Japanese counterparts.
I agree with you that most American cars are junk. I hate all these same features plus others like the weird headlight controls, parking break on the floor in non-trucks, not to mention the loose feeling brakes and steering.
Traditionally, GM sold other models overseas through brands like Holden or Opel, but these have all been sold off or shut down over the past decade or so except in China. GM now has a much heavier reliance on trucks and SUVs in the North American market. They sell some of those same product overseas still, but in much smaller quantities than before.
If not for tariffs, we'll all be driving BYDs in a decade.
STFU about GM. People who buy their cars love them, and I don’t trust folks that HN would like to be the designers on the C9 corvette.
I feel that companies just repeat discredited strategies because they are conventional wisdom, and no amount of explaining why layoffs don't make sense will stop them from laying off.
It's mostly about conformity. They heard that all the serious companies are laying off. So they've got to lay off too. Can't be seen breaking convention.
With big tech, a few years back when over-hiring was the conventional wisdom they were for that too.
The more fundamental question is: If mass layoffs are so necessary, then who’s responsible for the unnecessary mass hiring? In any mass layoff, fire that person first. Get to the root of the problem.
The article doesn't actually explain why. It claims that they don't work and supplies statistical evidence. But why don't they work? I've only really seen speculation...
Have you ever been laid off?
Yes. And your point being ...?
I can't believe no one here is talking about how horrible these charts are.
A large airline like southwest is one thing but I’m always so surprised at how much over hiring we do in software companies.
Every problem/opportunity seems to just need a few more headcount.
Lots of managers are actively trying to increase their headcount for self promotional reasons.
The whole thing seems really counterproductive.
And right now companies are doing the same thing with overseas hires, always assuming more is better
I find layoffs very context sensitive.
Atleast 2 of the fast growing companies I have been a part of have had serious layoffs that were very successful in cutting dead weight that had accumulated because of fast and loose hiring and poor middle management. So it can be done well.
By and large though they are a sign to jump from the soon to be sinking ship... so it's very important to know what kind it is and act accordingly.
"After the early-2000s dotcom bust, Bain researchers found that stock prices for S&P 500 companies that had no layoffs or laid off less than 3% of their workforce increased an average of 9% in the next year."
Do non-science journalists just not know about correlation vs causation? Does it really not occur to them that maybe the companies that didn't do layoffs were healthier and that's why they overperformed? Wouldn't a 10 year old know that?
How would you correct for it? As someone who works with ten year olds, they would ask you what causation and correlation is.
They might not know those words, but intuitively know that stuff like "ice cream trucks cause heat waves" make no sense.
One big problem is layoffs cluster around events like the dot com bubble, the financial crisis, or covid, so there are weird things happening. You might be able to look at companies' quarterly profits to identify healthy companies that remained healthy, but still did layoffs.
I was being hyperbolic about the ten year olds, but that's funny.
Correcting for it: I don't know. It would be very hard. You could try to control for variables like profitability, etc., but there are so many and you don't know what you don't know. But the correct response to absence of valid data isn't drawing conclusions from obviously bad data.
It just cracks me up that one paragraph later the author points out:
"Mass layoffs are often symptoms of unsound business strategies and don’t do anything to cure the larger problem."
and yet somehow didn't see that that sentence alone proves his previous one was pointless.
I find it fascinating that every single post on this godforsaken orange website inevitably has several comments that amount to "nuh uh!", and then they trot out the same three or four reasons why, this one being one of them.
Because it's a very common logical fallacy. You're also describing sample bias, someone who wholeheartedly agrees with the article probably has little to discuss.
Unfortunate click bait title for such an important topic. The various metrics quoted of why companies without layoffs appear to do better do not address the idea of underlying causes such as companies doing better do need mass layoffs while companies not doing as well likely to reduce expenses with actions to include layoffs.
The article compared companies within the same industries (e.g. the airline industry) which faced the same problems
Layoffs are a blunt instrument. I don’t know if al layoffs should be seen through the same lens. I see layoffs as signals from the companies. They see the future as unsure and so they want to reduce costs. That should be an immediate layoff for the ceo and his team
> That should be an immediate layoff for the ceo and his team
Maybe not quite that, but investors and the board (hah!) should ask really hard questions about how they got there.
The tech layoffs are the results of couple of years of exuberance that happened right after 2020. Companies are laying off and we are getting back to trendline. Nothing to see here.
This blog post is wrong, it also just doesn't matter in practice. Nobody who is making this sort of decision is going to give this kind of obviously false argument a second thought. When you're the one that actually has to make decisions that matter you're going to be better at ignoring bullshit. The audience for this is just people wanting something to upvote that sounds good to them - driven by motivated reasoning.
> “You could blame the workforce,” he says, “or the managers and leaders who are leading that workforce.”
They often do fire large swaths of middle managers - when Musk bought Twitter cutting out the middle of the hierarchy and the orgs that didn't need to exist was a big part of it. It's the same with DOGE. After the twitter layoffs they've shipped more features, faster, with better margins (and he fired the CEO). Meta and Coinbase over hired during the covid 'zero interest rate phenomena' and had to fix it. Reducing hours instead is a joke - I find it hard to believe anyone being honest takes that seriously.
Because layoffs are not done to make company great but to make sure shareholders and execs preserve their wealth. It's never about company or people or technology - it's always about money, power and wealth.
Nothing kills your culture like layoffs, but what if the culture has been overtaken by a whole lot of getting nothing done while collecting pay?
There is a theory about large complex systems which seems to be true in biology and maybe applies here. Intentional downsizing during times of stress works when it preferentially targets defective or dysfunctional components of the larger system. The system improves because the worst parts were removed.
Layoffs don't help companies unless they can reliably remove the worst parts. At most large public companies, the cancerous bureaucracy protects itself and the parts removed are closer to median performers, or even above-median performers. The system gets smaller and less efficient.
Layoffs can be necessary to get the company to fit through a certain sized hole (in the form of cash flow constraints), but it won't be better at what it does on the other side of the hole, it will just continue to exist.
Layoffs work when there is an accurate discriminating mechanism for who stays and goes. The best example of this (outside of private equity turn-arounds that are not widely known) is Twitter. Outside engineering talent was brought in as an oracle, immune to Twitter's bureaucracy. It reliably discriminated between value-adding and not. As a result, the company became incredibly lean and even consistently profitable.
Large tech companies are inefficient and have very poor engineering productivity but this is largely for systemic reasons. They definitely do not have any mechanism for identifying high performers.
The basic problem they face is that they pay a fixed wage for complete IP ownership (horrible deal) and so they intentionally do not measure and reward actual performance because they do not want to compensate high performers based on the value they create.
There isn't really a solution because these companies are making rational profit maximizing decisions, it just happens that mediocrity and managed decline of locked in revenue streams is profit maximizing for them.
> they intentionally do not measure and reward actual performance because they do not want to compensate high performers based on the value they create.
Ten years ago, an oft-repeated quote: “you’re not paid what you’re worth, but for the value you create.”
In light of that, is the argument that performance is institutionally obscured so that devs don’t realize how much leverage they really have? I can see traces of that in seeing shipped products as less the result of one/few devs working hard and more as multiple teams, as you now have two levels of personnel abstraction to diffuse potential leverage (individual/their team, and the teams among themselves).
Could I be missing something, but are you seriously promoting layoffs? You must be trolling by using twitter as functional example of why they work? I think sometimes I miss sarcastic tones and I really hope i did with this one
lmaoooooo buddy "oracle" implies they know something; the people brought in to fire people at Twitter spent almost no time in determining who was good or even how the company worked, completely undermining your thesis. It was madness: people were instructed to print paper copies of their code to bring into an office, like it was 1995. Remember geohot in a Spaces saying "the main problem with Twitter is that you can't run it locally?", as if any company of that size has run that way at any point in the last decade? Additionally, the horrible communication and chaos made it even harder for performers to perform. As others have pointed out, its stock lost a ton of value, it performs worse financially, and as a product by virtually every other metric has gone to hell (outages, CSAM safety, spam, bots...).
You tell a decent story at the start, but your choice of example couldn't be worse.
There's absolutely no reason whatsoever to think Twitter's financial performance improved after going private.
twitter is just about the worst example you could have used - by wide margin…
It depends if you mean keeping Twitter the service operational or Twitter the product relevant.
By the late 1960s, software projects had finally reached a certain size, and the particularities of managing these large projects were discussed at NATO software engineering conferences, and codified by Fred Brooks in 1975 in the Mythical Man Month. The upshot being, software projects at corporations can't be run in the same manner as non-software projects. Yet at Fortune 500 companies today, and in the past two years that includes at least some of the FAANGs, you see them trying to run software projects and treating programmers in the same manner they treat non-programmers, and it doesn't work.
I just happened to watch some old talk or interview with Gabe Newell recently, and he said industry thinking at the time Valve was founded was of a certain kind, and Valve took the opposite approach from the industry - the industry was looking to get cheaper programmers, and Valve went the other way and looked for the most expensive programmers, and so forth. Valve has probably less than 400 people working there (don't know the 2025 headcount), but makes billions a year in profit.
Outside engineering is not ever an oracle, and it has its own interior motives and bureaucracy, firing people is generally a one way street.
Twitter has literally issued authoritarian threats to advertisers to come on its platform or else because of how much its valuation has dropped and how much money has been lost - this is the worst example of "engineering oracle fixing things" I could possibly imagine.
Twitter was profitable before the takeover and now it is not
Maybe we disagree about what "profitable" means. Posting an authoritative source, so others can decide for themselves.
https://stockanalysis.com/stocks/twtr/financials/
I don't have that much of an experience analysing similar reports, but it seems to me to be a healthy and growing company?
If you mean a negative cash flow and operating income - it doesn't mean much, as we need to know why.
Taking into account the jump in "Revenue", positive "EBIT" and so on, I would imagine that it was because of some sort of "strategic investment", like some acquisitions probably?
What am I missing? I would definitely be happy with such reports if that was my company.
Unless I'm missing something, your data you've voted seems to be pre-acquisition.
Also, by all accounts their revenue has dropped so much they're having issues even covering the loan payments, much less having enough for any semblance of profit.
So over the 4 years before the takeover they had a net profit of $1.3 billion. What's their profit been in the 4 years since?
A couple weeks ago Google announced more layoffs in their HR and cloud divisions. They have $100 billion cash on hand, literally more than any other tech company, and much more in longer term investments.
In round numbers, that's enough money to cover roughly 10,000 employees for 25 to 50 years (depending on how much you think the salary averages out to).
Regardless, the CFO said one of her priorities this year was more cost cutting.
It's a business, not a jobs program
Layoffs are not about cost, they are about power. The economic result is just confirmation.
A large company in actual financial distress will sell off a division.
People are overthinking this.
It's about power, and inculcating fear.
The CEO who "cuts" people at a company is like the Aztec priest who plunges the knife in atop the pyramid. The bloody spectacle is the point. It's as much about everyone who's watching as it is about the specific victim. It says, "I can do this to you. I can inflict pain without reprisal. Behold my power."
That's the whole point. Who is afraid of whom?
These people have the money. We depend on that money in order to live. They are reminding us of that fact. Now they demand obedience and harder work. 40 hours? Not enough. Elon sleeps at the office, why don't you? You have to be "super hardcore".
Partly, this is punishment for the challenge that was raised to CEO power from around 2016 to 2022. CEOs have been furious that they have felt fear of their workers. Now they want those workers to feel fear. In interviews, Andreesen has said almost exactly this, if not in quite so many words.
A similar theory is at the root of Fed policy, which hinges on the idea of a "wage price spiral". In their view, inflation is caused not by the accumulation of capital within a price-insensitive upper quantile, or by the constriction of economic chokepoints by consolidation, but by workers' ability to bargain for higher wages. The solution to inflation, they essentially come out and say, is to put workers in their place.
There is a united front here. It is about who fears whom, the end. It is about your emotional state. In a literal sense, it is terrorism.
So in that sense, yes, layoffs work. Are you financially independent? No? Are you afraid? Yes? Then they're working.
I wish those departments tasked with busywork would be able to build skunkworks inside these dysfunctional molochs and be able to keep what they create. Fired into becoming a startup.. a man can dream.
I watched up close a multinational try to create a shunkworks and the ugly result was a lot more shunk than works...
They work to get quarterly profits up/losses down, and that's really all the matters to stockholders who want to decide to hodl or sail.
I've been through several layoffs, on both sides of the coin. The one consistent factor I've seen is managerial incompetence. Management will fail to provide any leadership or guidance to employees, then blame them for not being productive enough. They can't see their own incompetence, so they blame hiring practices and keep ratcheting up interview difficulty. It's like corporate America has evolved to protect the ego of the managerial class.
Don't work to do what? If you think layoffs are about efficiency or saving the company, at least in tech you couldn't be more wrong. Companies like Meta and Google have done multiple rounds of layoffs despite being insanely profitable and never taking a loss.
The real purpose of layoffs is to get people to do more work for the same or less money (by firing people and distributing their responsibilities to those who remain) and to suppress wages because nobody is asking for raises when they fear for their jobs.
Big Tech is really out of ways to grow their business. The only way they can keep growing profits is by cutting costs and the biggest cost is labor. It's really that simple.
what about layoffs that balance hiring elsewhere - laying off in NA hiring in India.
The other question is why C-suite does even need to tell the respective division management to lay off employees if the actual goal is cost reduction. Shouldn't they impose a budget reduction target instead and trust them to allocate the savings between capex, opex and salary budget according to specific situation at hand?
>> why C-suite does even need to tell the respective division management to lay off employees if the actual goal is cost reduction
You answered your own question. For a lot of layoffs, cost reduction isn't the goal; it's disciplining the workforce who were increasingly assertive at work about direction and conditions.
It’s honestly probably not that evil.(generally. There are definitely evil orgs out there)
It’s just the easiest way to make the stock price go up.
Layoffs caused twitter to bump in price. Same with Microsoft when they laid off all those game devs.
C-suite don’t care about profit or losses in tech, just the stock price.
In the 2010s, hiring devs increased stock prices. In the 2020s mass firings do.
It’s just money. Simple as.
"It's just money."
And real people with real lives and families and steadily-increasing expenses. Fuck you, "it's just money"...
The C suite wants to take the blame, so the people you deal with face to face can honestly say the decision was taken out of their hands.
> actual goal is cost reduction
For many companies the largest cost is labor. Also in many companies, managers amass power by the number of people they manage. If the C-suite doesn't explicitly push for layoffs they will likely not happen, causing them to not reduce costs as quickly as they wanted.
Nah I've been in meetings before where it was asked "if we can find these ten million in cloud costs and licenses, can we retain staff?" and the answer was "no, because those are different buckets."
Regarding "managers try to amass staff," I've seen some of that for sure, but it's not universal and acting like it's some kind of iron rule of organizations is an op.
Most managers are evaluated based on the impact their organization is having, not the size of it, unless the firm is incredibly poorly run.
What does happen, and where these layoff edicts come from, is that the executives fear the management is more loyal to their directs than they are to leadership. They feel that if they want to inflict something on the workforce they have to "force" management's hand, because otherwise management will resist.
But then you will still get short-sighted layoff decisions getting made, only by directors instead of C-suite.
The top comments read like HN of a decade or two ago when armchair exporting was rampant.
Paraphrasing: "I, an engineer, am smarter than an economist therefore the article is wrong."
Nothing of value to be found at the top of the comments.
No, we’re saying the majority of economists are more likely to be accurate than this particular economist.
Combine that with temporarily-embarrassed billionaires and it's a recipe for disaster. Every last asshole here is hoping for a fat exit for some ReactJS garbage that probably just grinds up poor people into McDonald's hamburger meat; of course they don't give a shit about actual workers with actual lives, whom layoffs predominantly hurt.
I've been laid off, eight months after a hiring blitz for the exact division I worked for. Now, I could've told them the acquisitions they did were stupid and that the products were never going to be profitable, but I don't live in Manhattan, so those decisions are above me. But that didn't stop them from juicing the stock price and ruining our lives anyway.
Fuck these companies. They could do better, and they choose not to. And every last sycophant here is complicit.
Layoff are like hammers: When needed, in the hands of someone skilled, they work perfectly well. But such situations are sadly rare, compared to frustrated idiots grabbing hammers to get their quick "Hulk Smash!" dopamine hits.
But surely the billionaires in their lavish lifestyles, they're the ones that really know how to run a frugal enterprise.
When it is your money making payroll, than the perspectives rapidly shift.
If your Labor doesn't tangibly produce quantifiable profit, than you must furlough staff to stay in business. Assigning fault in such situations is a fools errand, as everyone suffers losses in the end ($18k to $45k in lost training resources per person etc.)
Best of luck, =3
"Companies who enact them as part of a broader change in strategy, Cascio says, fare better than those who enact them simply to cut costs."
Ah, the old strategic realignment PR BS. "Its not cost cutting because our C levels are clowns and screwed up. Its a strategic realignment for AI investment ". Lol. Didn't Salesfarce and Fakebook both use that one?
When will AI replace upper management? It can't do any worse.
This whole article is selection bias:
> There are findings that suggest layoffs lead to both short-term and long term issues, including: > - A 2x as likely chance of bankruptcy compared to companies that haven’t done layoffs.
Obviously! Because a huge number of the companies undergoing layoffs are about to go under and are using layoffs as a last ditch survival effort.
The author may be right, but every fact and figure presented in this article fails to distinguish between healthy companies in healthy industries using layoffs as a lever to increase stock prices, and layoffs happening in industries/companies that are collapsing.
Seems like a clear case of correlation != causation.
Of course layoffs are correlated with bad company performance. I dont know if they help, but i would expect the pattern either way.
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The article lists down why layoffs don't work, but companies keep doing it, so it must be working for them.
I hate layoffs (from both perspectives), but the article sounds like whining "we shouldn't break up".
The alternative of furlough only works if everyone else is doing it. If everyone else fires left right and center, the people being furloughed will still have low morale.
I think it's better to avoid it in the first place, by not over hiring, as others have pointed out.
I think you’re right that it’s better to avoid these issues in the first place, but your perspective on furloughs instead of layoffs seems a bit fatalistic. I think a company that did rolling furloughs (and importantly was transparent about the whole process) would probably maintain pretty good morale, especially if the rest of the industry is laying people off. But yeah singling people out for furlough would probably be a big morale hit
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