The tech industry has been deeply unsettled by a wave of layoffs in recent years. Beginning in 2022, there was a marked escalation in job cuts within the sector, as major players such as Amazon, Alphabet, Microsoft, and Meta collectively reduced their workforce by thousands. This trend continued into 2023, witnessing a staggering 59 per cent increase in job eliminations compared to the previous year, with Layoff.ly reporting a total of 262,915 employees affected across various firms. Economic downturns, overstaffing during the pandemic, and strategic reorganizations aimed at bolstering financial stability were cited as primary reasons behind this surge in layoffs. Despite these sweeping job reductions persisting for several months, there are no indications of a slowdown in layoffs within the tech industry as 2024 unfolds.
According to data compiled by Layoffs.fyi, a startling 98,834 employees have already been laid off by 337 tech companies in the first half of this year alone. Companies are maintaining a relentless focus on minimizing operational costs, resulting in continued job reductions. While the looming threat of job loss is already a significant source of stress for IT professionals, a troubling new trend known as "silent layoffs" is gaining traction.
As reported by Moneycontrol, the Indian IT and IT-enabled services (ITeS) sector is increasingly adopting this practice, which involves discreetly pressuring employees to resign without public announcement. The All India IT & ITeS Employees' Union (AIITEU) disclosed that approximately 20,000 technology professionals were impacted by such undisclosed layoffs in 2023, with actual figures suspected to be higher.
In silent layoffs, employees are typically provided with a 30-day period to secure an alternative position within the company. Failure to do so often leads to termination. This method, according to AIITEU, is widespread and enables companies to reduce their workforce covertly, thus avoiding public scrutiny and potential backlash.
Another report from the Nascent Information Technology Employees Senate (NITES) highlighted that leading Indian IT service companies have silently laid off between 2,000 and 3,000 employees in the first five months of 2024 alone. NITES President Harpreet Singh Saluja informed Moneycontrol, "There are various ways companies are terminating employees, and those who resist will be terminated immediately. Once you are marked as 'terminated' in your relieving letter, it becomes extremely challenging to secure another job."
It is important to differentiate silent layoffs from "quiet firing," which involves making employees' roles progressively undesirable through tactics like overloading them with tasks or assigning insignificant duties. This coercion often compels the employee to resign voluntarily.
Nevertheless, silent layoffs have significant implications for affected employees. Many find themselves placed on performance improvement plans (PIPs), requiring them to swiftly demonstrate their value to avoid dismissal. This situation frequently leads to heightened stress and job insecurity, particularly for individuals unable to secure alternative roles within the company. Reports suggest that experienced and higher-paid employees are particularly vulnerable to silent layoffs as companies target them to trim costs.
As the tech industry grapples with ongoing challenges, the proliferation of silent layoffs poses a formidable obstacle for its workforce. While companies may view these strategies as essential for survival, the toll on employees and their careers cannot be overstated. As the year progresses, it remains to be seen how the tech sector will address these issues and what measures will be implemented to support its workforce during these turbulent times.
