When a person has fired from a job five or even ten years ago, it signified the end of their professional career. But today, layoffs are no longer frowned upon. Companies, or at least many of them, are willing to hire workers who had their previous employment terminated due to performance issues.
Big Tech businesses have just posted less-than-stellar earnings, but they have also given off warning indications about the months to come. Companies claimed that customers were cutting down on their spending because a recession was imminent, and there were few indications that things would soon turn around.
What are the most common reasons a company does mass layoffs?
More people will have access to more affordable automation, which directly competes with the high-volume, low skill work done by the BPO sector.
The redefining of market entry rules and the disruption of traditional marketplaces, such as the primary point of distribution of goods, the retail store or mall, is now being challenged by online marketplaces that have a greater reach and lower operational costs OR the insurance industry, which heavily relied on the Sales Agent to drive revenue and sales – OR the car rental industry, which has been replaced by an "Interface" company that connects customers with car rentals. As their markets are disrupted, those who outsourced their IT businesses are facing a decline in revenues.
Even though technology is what is causing the disruption, IT organizations have a set of capabilities and business relationship models that prevent them from participating in the digital transformation market.
The major business interface for an IT outsourcing company is evolving. To appeal to the new IT buyers, IT organizations are attempting to innovate and change. Since the successful and timely usage of IT is now essential for generating revenue, business growth, and survival, they are learning how to relate to, collaborate with, and meet the needs of the CEO and the CFO who are playing a much larger role in choices pertaining to IT spending.
Some more reasons are as follows:
Increase the bottom line to make it appear better in earnings reports and more appealing before being acquired.
When two companies merge or are bought, employees that are redundant are let go.
Losing a significant customer or stopping production on crucial lines (which is happening with Senior management).
The business may occasionally need to "prune" since there are actually more employees than are required to complete the work.
Employees are replaced by technology. Because workers can perform administrative tasks now using computers, entire administrative departments have vanished since the 1980s.
The other reason is the pandemic, which encouraged the boom, has now ended for the tech industry. What's taking place right now is sort of a correction as the IT industry readjusts to a period when people aren't cooped up at home, glued to their devices.
In my opinion, the layoffs are a result of growing automation, declining revenues, and the need to update the talent mix to meet market demands, is the succinct answer.
For instance, Google, Meta, and Amazon conclude at the end of 2022 or the beginning of 2023. They are trying to eliminate expenses from their balance sheets before their fiscal years end. For instance, if a worker is let go now and given six weeks of severance, the first quarter's costs are reduced. Even if employees receive a lengthier notice period, such as three months, their wages would no longer be recorded before the. This is due to the fact that a person being asked to leave today need not be a poor performance. Most often, this is because the company is attempting to cut costs as a result of things like a funding round failing to materialize or an overall economic slowdown, like the one we are currently experiencing.
Having said that, it can be terrifying to be asked to leave. Every employee's biggest dread is that. And today's insomniacs are not simply limited to employees from India. All throughout the world, people are being laid off. So far along from tech companies have fired about 45,000 employees globally since the start of this year.
Many consulting companies predicted that " Few companies would definitely die." However, despite the term "dot-com bubble 2.0," analysts assert that the modern tech industry has advanced and has strong fundamentals, which will help things get back on track.
Top Indian Corporate sector’s view point is that over the past 10 years, international businesses have primarily chosen India for its cost-effectiveness and stayed for its high quality. Today, however, India has evolved into a true talent hotspot in the world. As a result, multinational corporations in need of talent might present remote employment opportunities to Indian Tech workforce.
Dr.Praveen Srivastava, Executive CEO Coach ( www.praveencsrivastava.com )