Northwest tech companies are laying off workers, or putting a freeze on hiring. It's an industry trend that has some folks concerned, especially as the word "recession" creeps further into speculation over the next year.
This post originally appeared in KUOW's Today So Far newsletter for November 14, 2022.
If you can think of a tech company in the Northwest, chances are they are looking at laying off employees or implementing a hiring freeze. It's an industry trend that has some folks concerned in the region, especially as the word "recession" creeps further into speculation over the next year.
State labor economist Paul Turek tells Northwest News Network's Tom Banse that the market still favors job seekers, especially in the tech sector, though he does admit that the job market is "exceptionally tight."
"Job openings have crested, beginning to come down a bit, no longer at the highs, but they're still at a historically high level," Turek said.
Redfin is cutting 13% of its staff. Thanks to some Elon Musk switch ups, Twitter is cutting about 200 jobs locally. Meta, Facebook's parent company, is also cutting 13% of staff companywide, which is about 11,000 employees.
Amazon previously said it would simply hold off on hiring, but the New York Times reported this morning that the company plans to layoff 10,000 employees across its corporate and technology divisions. It's the largest such job cut Amazon has ever made.
Microsoft has also said it is in a holding pattern. As New York Times Technology Reporter Karen Weise tells Seattle Now, the company is in "stasis."
"Microsoft said that they expect to have a flat headcount in this current quarter, Amazon has this hiring freeze ... but they're still really big, substantial parts of the U.S. economy, the global economy, and certainly of our region's economy," Weise said.
Weise adds that, "These companies are much bigger than when they started the pandemic. Amazon basically doubled in size in two years, for example, Microsoft has grown substantially."
Now it seems these large companies are being more careful and are watching where they spend their money. They're even pulling back on recruiters, the people tasked with finding employees to fill jobs. Microsoft, for example, has started cutting back on products that aren't as profitable. It also stopped hiring for certain departments, starting with retail, but Weise says that hiring freeze has expanded.
"What's notable about that is that it includes some of the key growth engines for the company," Weise said. "For example, cloud computing, which is much more lucrative than the retail industry. Advertising is another highly profitable part of their business that would also fall under this broad umbrella."
"In terms of the overall, broad regional impact, it will really depend on how long this will last," she said. "Is this a quarter of trying to reset things and get a new baseline and see where the economy is? Or are we in for a prolonged recession? In which case, you would expect to see a different level of impact. There are a lot of moving pieces in the national economy, and the local economy right now."
