Layoffs have been a common occurrence this past year for technology firms as executives look to make more efficient decisions and reduce costs. Gene Munster, a managing partner at Deepwater Asset Management, believes tech companies are far from over with their layoffs, potentially cutting headcount even further after the drastic decrease over the past several months. Microsoft and Google are especially expected to experience layoffs due to their growth generated by AI and the “laptop generation,” a term coined by Elon Musk, according to Munster. Microsoft previously cut 10,000 employees back in January, while Google mentioned an estimated 12,000.
Microsoft and Google are well-known tech giants in the market today. Microsoft, founded in 1975, is a tech giant and leader in the industry. The company offers a wide array of services including Azure, Office, Power BI, Dynamics 365, and Windows. Google, founded in 1998, is renowned for its search engine, Gmail, and many other platforms. Despite being a tech giant, the search engine is not immune from layoffs, with the depressing job losses tallied up to over 360,000 across the industry since 2021.
Gene Munster, the managing partner at Deepwater Asset Management, is a well-known tech investor. He had a successful career in venture capital as the founding partner of Loup Ventures, and has been featured in multiple publications such as CNBC, Fast Company, Bloomberg, and The Wall Street Journal. Munster is famously known for his predictions on topics such as Facebook’s IPO, Apple’s stock value, and the success of Amazon. With such recognition, people are certainly listening when Munster says that further cuts in headcount could potentially happen in response to the contraction of the economy.
Evidently, tech companies are in the process of making decisions to maintain efficiency and manage costs. By targeting middle-managers, Silicon Valley leaders like Elon Musk identify them as members of the ‘laptop class’ which he believes to be separate from operations. Additionally, pressures to return to working in-office and reclaim potential advantages is pushing remote-workers into feeling anxious about potential loss of jobs.
Ultimately, technology firms adjusting their strategy to what Munster says, is representative of the current state of the market. Although it is not what the tech industry has been accustomed to over the past year, it is a necessary step to handle the current economic downturn. Whether it is Microsoft or Google, no company can remain immune from the negative impacts of the job industry.
