Several major companies announced significant layoffs in January 2023 in response to economic pressures and shifts in consumer behavior. Disney plans to cut 7,000 jobs, representing over 3% of its global workforce, with the entertainment and ESPN divisions being hit the hardest. Meanwhile, Zoom announced layoffs of 1,300 employees, or 15% of its workforce, along with executive pay cuts. Dell will be laying off 6,500 people, which amounts to 5% of its global workforce, due to declining demand for PCs. PayPal has announced it will be laying off around 2,000 employees, or approximately 7% of its workforce.
IBM, Google, Amazon, and other companies to lay off employees in 2023
IBM is cutting roughly 1.5% of its global workforce or around 3,900 positions. Spotify has laid off 6% of its global workforce, or approximately 400 employees. Google is laying off 6% of its workforce, which equates to 12,000 employees. Microsoft plans to eliminate 10,000 jobs through the end of March 2023. Amazon is cutting 18,000 jobs worldwide, which represents roughly 1% of its global workforce or 3% of its corporate employees. DirecTV is laying off 10% of its management, which is about half of its total workforce. Salesforce plans to cut 10% of its workforce or around 7,000 jobs. Vimeo is laying off 11% of its employees. The total number of job losses across these companies is around 52,200 employees.
Businesses provide affected employees with voluntary severance payments amid layoffs
Several businesses have provided affected employees with voluntary severance payments as part of the layoffs, which are part of larger cost-cutting initiatives. These job losses may have a big effect on people, families, and the economy as a whole.
Survey reveals high likelihood of layoffs, hiring freezes, and pay cuts in 2023
According to a survey, 61% of business leaders anticipate layoffs in their organizations in 2023. Among the 61%, 57% of business leaders expect to lay off 30% or more of their workforce. The survey also revealed that 70% of companies are likely to implement a hiring freeze in 2023. Of those surveyed, 34% said their organizations have reduced or eliminated holiday gifts or bonuses, while 27% reduced the salaries of current employees. Meanwhile, 79% of business leaders said they were likely to fire ‘quiet quitters’, and 74% agreed that it would be easier to fire poor performers in 2023 as employees lose bargaining power. The study also found that larger companies are more likely to lay off employees, with 74% of business leaders in companies with over 500 employees saying there will likely be layoffs in their organization, compared to 51% of business leaders in companies with 500 or fewer employees.
Are the 2023 Layoffs a Sign of a Recession?
While layoffs can indicate economic trouble, there are many reasons why companies may reduce their workforce. Nonetheless, it’s important to monitor the situation closely as layoffs can have a ripple effect on the economy, and a high number of job cuts across various sectors could lead to a widespread impact on the economy.