The technology industry will have a big year in 2024. Nvidia beat revenue expectations. The artificial intelligence boom is still in full swing. The tech-heavy Nasdaq index is up more than 8% since the beginning of the year.
The U.S. economy is also doing surprisingly well, with payrolls increasing by 353,000 in January, well above economists’ expectations. Better-than-expected inflation data also means the Fed may not cut rates as soon as markets expect, a sign that the economy remains strong enough to support tight monetary policy for an extended period of time. is.
However, it’s a different story for technology workers.
“The layoffs through early 2024 signal a seismic shift in the technology industry,” said Jeff Shulman, a professor at the University of Washington’s Foster School of Business. “We will continue to see layoffs because the future of work is changing, the future of technology is changing, and investors’ risk appetite and growth versus profitability trends are changing dramatically.”
The number of layoffs in the tech sector in 2024 will exceed the number of layoffs in 2023. Some 42,324 tech workers have been laid off so far in 2024, according to Layoffs.fyi, which tracks layoffs in the tech industry. This means that in 2024 he will be laid off an average of more than 780 people per day. In 2023, approximately 263,000 technology employees were laid off, with layoffs in that year averaging approximately 720 per day.
There are several factors behind churn. AI is at the forefront. Companies need to free up cash to invest in the chips and servers that power the AI models behind these new technologies. There is also the influence of the stock market. Companies that cut jobs are not punished by investors or profits. In fact, they have benefited from rising stock prices.
Watch the video above to learn why tech workers are in store for another tough year of layoffs, and why the incredible strength of the U.S. economy won’t help them.