Dive Brief:

• Tech layoffs have surged in the first few months of 2024, more than doubling since the fourth quarter of last year, according to data from the website layoffs.fyi.

• The tech industry announced more than 50,000 job cuts since the start of the year, according to layoffs.fyi. This is up from less than 24,000 in the last three months of 2023, according to quarterly data shared with CFO Dive by the site’s creator, tech entrepreneur Roger Lee.

• IBM, Apple, Amazon, Meta, Microsoft, Salesforce, Zoom, and PayPal are among more than 200 tech companies with layoffs so far this year, according to the site.

Dive Insight:

The latest figures show that layoff activity in the tech sector may be far from over after a massive spike in the beginning of 2023 followed by a lull later in the year, according to Giuseppe Gasparro, a partner & managing director at New York-based consulting firm AlixPartners. 

“What we’re seeing is companies adapting to a new normal,” Gasparro said in an interview, adding that he expects to see more layoffs this year, although the levels may begin to stabilize.

Factors such as high interest rates, slowing customer demand and over-hiring during the COVID-19 pandemic have forced technology industry executives to adopt a more structured, long-term approach to ensuring profitability, according to a report by AlixPartners.

More than 167,000 job cuts were announced by tech companies in the first quarter of 2023, according to Lee’s quarterly data, shared via email. The number plummeted in the second quarter of 2023 to about 46,000 and declined further in the third quarter to under 26,000.

The recent resurgence shows that tech giants remain laser-focused on optimizing their productivity and profitability this year amid pressure from investors and uncertainties on many fronts, Gasparro said.

“It’s an election year, interest rates are still high, and the fear of a possible recession is not completely gone,” he said. On top of all of this, tech companies are grappling with market disruptions stemming from the rapid rise of artificial intelligence, he said.

Across the broader economy, U.S. companies announced 166,945 layoffs in January and February, down 7.6% from the 180,713 job cuts announced in the first two months of last year, according to a recent report by business and executive coaching firm Challenger, Gray & Christmas. The technology sector led all industries with 28,218 cuts, the firm reported.

February’s total of 84,638 is the highest for the month since 2009, when 186,350 job cuts were announced in the second month of the year.

Companies are no longer shrinking their employee size simply because of over-hiring — they're now realizing there can be benefits to being leaner, Mark Zuckerberg said last month in an interview with Morning Brew Daily's podcast, as reported by Business Insider.

After laying off tens of thousands of workers, Meta has been making a comeback, with its stock at an all-time high, the publication reported.

"It was obviously really tough; we parted with a lot of talented people we cared about," Zuckerberg said in the interview, according to the report. "But in some ways actually becoming leaner kind of makes the company more effective."