As the fears of recession seem to loom over the C-suites of America, quite a few of the leading Big Tech firms are bringing a halt to the hiring of any new employees.
The economy of the United States shrank at an annualized rate of about 1.5% across the first quarter of 2022, as reported by the Bureau of Economic Analysis, which defines recessions as two consecutive quarters sporting negative growth rates. As a stock index that is very technology-heavy, the Nasdaq had seen extended losses over the course of the year, and at one point even going through its worst selloff since the historic dot-com bubble back in 2001.
Reportedly, Microsoft is just one of the most recent firms to slow down on its hiring across the company. As seen in a report in Business Insider from this past Monday, Microsoft is slowing down the growth of a cybersecurity venture that is being headed up by Charlie Bell, a former Amazon executive, from their projected increase of over 4,000 new positions down to just barely managing 200 new positions. Additionally, the company is also going to look into pay increases in order to prevent employee attrition to Microsoft’s various competing firms.
While this takes place, cryptocurrency firm Coinbase released an announcement claiming that it would respond to “current market conditions and ongoing business prioritization efforts” by continuing to maintain its currently held hiring freeze “for both new and backfill roles for the foreseeable future,” along with the canceling of “a number of accepted offers,” as reported by a blog post put out by LJ Brock, the Chief People Officer of Coinbase.
“We always knew crypto would be volatile, but that volatility alongside larger economic factors may test the company, and us personally, in new ways,” read the post.
Additionally, Lyft, the popular rideshare company, is planning to slow down its hiring processes and then bolster its stock options in response to its dropping stock share price. “It’s clear from our discussions with other business leaders that every company is taking a hard look at how they respond to concerns about an economic slowdown and the dramatic change in investor sentiment,” stated John Zimmer, the President of Lyft, via an internal memo that was obtained by The Wall Street Journal. “Given the slower than expected recovery and need to accelerate leverage in the business, we’ve made the difficult but important decision to significantly slow hiring in the US.”
This past week, it was unveiled by Reuters that Elon Musk, the CEO of Tesla, stated to his executives that he was seeking to cut about 10% of the firm’s current 99,000 jobs because he had a “super bad feeling” concerning the economy. He ordered the leaders of his company to “pause all hiring worldwide.” This release dropped just two days after Musk, in another email, stated that “remote work is no longer” going to be acceptable at Tesla.