Based on the data compiled and revealed by layoffs.fyi spanning 2020 through 2022, the United States has experienced a significant number of layoffs in the tech industry. With over 330,000 job cuts in the span of three years, the U.S. surpasses all other countries in this regard. These figures are nearly 10 times higher than those of India, the country with the second-highest number of tech layoffs, and more than double the aggregate layoffs of the next nine countries combined.
According to the U.S. Bureau of Labor Statistics, the total jobs at its peak in 2020 was approximately 160,000,000, with 10,000,000 jobs or about 6% of the total, being defined as “STEM” or “tech” jobs. According to the 2020 US Census, there was a population of approximately 333,000,000 US citizens. Therefore, in 2020, about half of the US population was employed. The total tech layoffs during 2020 to 2023 represent about 3% of the total US tech workforce and about 0.1% of the total US population.
It is more likely the U.S. sits closer to 140-145,000,000 jobs, with maybe 8,000,000-8,500,000 tech jobs, going into 2024.
Top Ten Tech Layoffs
10. Singapore
6,995
9. China
7,190
8. Canada
9,848
7. Brazil
11,143
6. Sweden
13,459
5. United Kingdom
14,379
4. Germany
17,653
3. Netherlands
18,055
2. India
48,634
1. United States Tech Layoffs:
348,901
These are technical, STEM job layoffs; a third of a million in three years. More than one hundred thousand jobs per year lost.
Regardless if these jobs are later replaced, that’s nearly 2000 tech jobs per week have been taken away from working American STEM employees since 2020.
Possible Interpretations of Data
There are several likely causes for this job loss:
- Oversaturation of Tech Jobs in the U.S.: The high number of layoffs in the U.S. tech industry might suggest that the sector was overstaffed or overly optimistic in its hiring during previous years, leading to a correction phase where excess jobs were eliminated.
- Aging Workforce and Replacement with Younger, Less Expensive Talent: If the laid-off jobs were refilled, it could imply a turnover in the workforce, where older, potentially more expensive employees were replaced by younger, less expensive talent. This could be driven by cost-saving measures or a shift in the skill sets needed in the evolving tech landscape.
- Impact of Economic Cycles on the Tech Industry: The tech industry, especially in the U.S., may be more sensitive to economic cycles. Layoffs could reflect broader economic downturns or shifts in investment and consumer behavior. There might also be companies that presume Artificial Intelligence can later compensate for the job losses.
- Technological and Industry Evolution: Rapid evolution in technology can lead to changes in the skill sets required. Jobs requiring older technologies may be cut, while new jobs requiring different skills are created, leading to a mismatch in the short term.
- Globalization and Outsourcing: The U.S. tech industry might be more affected by globalization trends, including outsourcing to countries with lower labor costs. This could contribute to higher layoffs in the U.S. compared to other countries. The operations for Cloud Computing are done more cheaply, and with less care for ecological impact, outside the U.S.
- Higher Degree of Reporting and Transparency in the U.S.: The U.S. might have more transparent reporting mechanisms for layoffs, leading to higher reported numbers compared to other countries where such data might not be as publicly disclosed.
- Impact of Policy and Regulatory Environment: Differences in labor laws, corporate policies, and economic strategies across countries could affect the rate and nature of layoffs in the tech industry.
- Market Saturation and Competitive Dynamics: The U.S. tech market itself might be more saturated and competitive, leading to more frequent business failures or consolidations, which in turn lead to layoffs.
- Shifts in Business Models or Strategic Realignments: Companies in the U.S. might be more prone to rapid shifts in business models or strategic realignments in response to market trends, leading to restructuring and layoffs.
And it is entirely possible each of the above dynamics are in play.
References
https://en.wikipedia.org/wiki/2020_United_States_census