Cisco Systems, my employer, laid off 4000 people yesterday, 5% of our total headcount. I’m lucky enough to still have a job. I know people who were unlucky. There but for the grace of God go I. It is a strange feeling working in corporate America, where a giant sword of Damocles hangs over your head. Each time a round of layoffs happens you feel both relief and survivor’s guilt. Each year you know another cycle is coming. You can never relax for too long, so you exist in a perpetual state of uncertainty and anxiety. Will it be me, the next time?
Because layoffs eliminate job roles, they are not performance-based. That makes it even worse, because even if you are a talented high-performer, you could still face the axe. I’ve seen it plenty of times. Then again, even if you feel secure, a new leadership regime might show up and decide they don’t like you. I’ve gone from being the favored son to being the black sheep in an instant when an exec resigned and I was moved. Corporate politics are human politics.
Cisco’s layoff was, thankfully, light in comparison to the industry. The Wall Street Journal informs us (paywall) that the “Era of the Mega-layoff has arrived.” Block laid off a whopping 40%. Amazon is cutting 30,000. I can be thankful Cisco’s executives and board decided to stay with a smaller, targeted layoff. It could have been much worse.
On the other hand, the mega-layoff people tell us it’s a great thing. A company that lays off half of its staff will “get a big stock bump and praise from investors”! The management-types are positively thrilled about sending half of their employees into financial ruin. Mo Koyfman, who runs a VC firm, tells us companies would do well to cut up to half of their staff. (According to his LinkedIn profile, Mr. Koyfman attended some kind of seminary for a degree in “philosophy and religious studies.” The philosophical studies must have been confined to Machiavelli.)
Then there’s Amrita Ahuja, the CFO of Block, which nearly laid off nearly half of its people. Apparently Ahuja is getting calls from other executives looking for her “playbook”! People are coming out of the “woodwork” asking her for advice! When it comes to layoffs, it’s better to be a “bit early than to be too late…” Do I detect a note of giddiness in her response? A sense of pride in being the first to ruin lives and careers? Ahuja got her MBA from Harvard, so she’ll always have a job. But for those who didn’t, well…who cares about the little people?
Look, I’ll be the first to admit that the corporate world is filled with worthless hangers-on. Employees who are barely showing up for work and collecting a paycheck, people with no noticeable skills other than to stay employed. Miltons from Office Space. People with MBAs from, I dunno, Harvard, who speak nonsense corporate gibberish and continually get promoted up the executive ranks while competent people collect a pink slip. However, these carpet-bomb blanket layoffs affect the competent with the incompetent, and any one of us who has been involved in them has seen that time and again.
People who decide to do these mega-layoffs would do well to remember the individuals they are affecting. Once laid off, life becomes uncertain. How will I pay the mortgage? How will I send my kids to school? How will my wife look at me after I come home and tell her? Will I be working at Home Depot or as a bartender when I can’t make ends meet? I guarantee you the mega-layoff people don’t think much about such things. Like good sociopaths, they are able to inflict harm on others without empathy. The San Francisco Chronicle tells us that “The tech job market is a bloodbath. It’s likely going to get even worse.” They also tell us that “Laid-off tech workers [are] advised to sell plasma, personal belongings to survive.” Fantastic.
There is a creeping malaise over our industry. There is a sense that AI will render technical expertise obsolete. Who needs network engineers anymore when ChatGPT or Claude can do what they do? I suspect–and I may be wrong–that we are vastly overestimating the capabilities of this tool, for it is only a tool. Nevertheless, the mega-layoff advocates, as we saw above, are doing anticipatory firings, instead of approaching the new AI era with caution and thoughtfulness.
While I’m thankful my own company has, for now, only done a smaller round of cuts, I nevertheless feel for the people who were affected and their families. I’m also thankful that as an individual contributor, I did not need to make any calls this time. Let’s hope that things stabilize a bit, but I have a feeling the current irrational exuberance over AI will lead to bad things to come.