Tech Sector Layoffs Spike to Three Year High

Those who grab the golden ring sometimes find it can turn to lead.

Intellectual stimulation aside, part of the allure of jobs in tech has been the opportunity to cash in through a buy out or public offering. But that which fuels the fevered dreams of young programmers is occasionally the stuff of nightmares.

The flip side of working for a public company is that in addition to the riches, there are usually daunting obligations. Like meeting the often unreasonable expectations of sell side analysts and buy side investors who want growing sales, margins and profits. And even if 'everybody knows' that hits dont always keep on coming with clockwork regularity, they want what they want. Which means management gets criticized, stocks get downgraded and someone has to take the fall.

That someone is sometimes but not usually a senior executive. Since there are many more of the rank-and-file, and analysts like big numbers of all kinds, big numbers of laid off workers tend to impress more than small numbers.

As hard as it may be for some of its denizens to believe, tech is tied to the larger economy. Growth is down, as are incomes and jobs. Which means fewer companies are buying fewer devices for their fewer employees. Welcome to their world. JL

Jolie O'Dell reports in Venture Beat:

While startups scramble to hire the best engineers, tech workers at many companies this year have received the dreaded — and perhaps unexpected — pink slip.

Survey results show that layoffs at tech companies in the first half of 2012 are at their highest point in three years, totaling 51,529 job cuts between January and June.
In the same time period one year ago, around 14,000 jobs were cut, making this year’s figure a 260 percent increase in tech jobs lost and a 39 percent increase compared to the total number of jobs cut in all of 2011.

Computer companies cut 34,380 positions, and telecommunications companies slashed 13,059 jobs.

“While consumers and businesses are spending more on technology, the spending appears to favor a handful of companies,” said Challenger, Gray, & Christmas CEO John Challenger in a statement today.

“Those that are struggling to keep up with the rapidly changing trends and consumer tastes are shuffling workers to new projects or laying them off, altogether.”

Challenger, Gray, & Christmas specializes in corporate downsizing or “outplacement,” as the firm so euphemistically puts it. It released a report on the job cuts today. According to the report, many of these jobs were at HP, which saw a massive workforce cut this spring — as many as 30,000 employees. These five-figure firings have also been seen in companies in the book-selling and baking industries.

Joining HP in the restructuring are:

■Sony, which laid off 10,000 folks in April
■Nokia, also cutting 10,000 jobs in June
■Dell, which cut $2 billion or so worth of sales and supply chain jobs in June
■T-Mobile, which cut an unspecified number of jobs in a string of restructuring moves
■Yahoo, which has so far let go of 14 percent of its workforce, give or take a couple PR liabilities masquerading as CEOs