Meta, Google, Microsoft layoffs: MoS IT Rajeev Chandrasekhar says overestimation of demand led to post-COVID job cuts

Layoffs have taken place across Tech and IT companies including Google, Infosys, Tech Mahindra and more in 2023. Minister of State for Skill Development and Entrepreneurship and Electronics and Information Technology of India, Rajeev Chandrasekhar believes that people overestimated the demand for digital products during the pandemic.

In an interview with The Indian Express, the minister stated, “If we look at the tech space, layoffs occurred post-Covid, it happened to companies like Google, Microsoft, Meta, and even smaller startups. It has happened to the biggest and the smartest and the greatest, and then the small startups as well. Everybody coming out of Covid thought that digital boom and the expansion will be a permanent phenomenon.”

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He said companies assumed that remote work is going to be a permanent work model that convinced them to hire employees in bulk. He stated, “Everybody thought work from home would be a permanent thing. Now post COVID, as the disease is being defeated, economies are settling down and the whole models are recovering, there is now a balance between the digitised world, the digitised workplace versus the real workplace.”

He stated, “There are people who have overestimated demand, overestimated consumption of digital products and services, and that correction is manifesting itself in resizing right sizing of organisations. This is, in my opinion, a pretty natural thing for companies, even the big ones and the startup space, specifically the booing or bust is, in a sense, built into the DNA of what a startup is.”

Tech giants and IT companies are still making job cuts across different departments. In the recent past, companies like Accenture laid off 80 employees, Spotify fired 200 employees and Shopify handed pink slips to 20 per cent of its workforce.

Meta laid off 10,000 employees earlier this year and announced a hiring freeze. Late last year, the social network fired 11,000 employees. Back in January, Google made 12,000 job cuts. CEO Sundar Pichai revealed that Alphabet had been hiring for a “different economic reality”. These layoffs were followed by those in Amazon. The e-commerce giant made 27,000 job cuts since January 2023. Amazon CEO Andy Jassy revealed that “uncertain economy” and “rapid hiring” in recent years are to be blamed for the mass layoffs.

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