Business news : Tech companies layoffs exceed 1 lakh, preparing for more cuts ahead.

Thousands of unemployed in the tech industry, IT companies will make one and a half lakh (150,000) hires.

The second half of 2024 saw continued layoffs across the tech sector, with major companies like IBM, Cisco, and Microsoft significantly reducing their workforces. The ongoing restructuring and cost-cutting measures, prompted by economic challenges, are impacting both large corporations and smaller startups. Despite these layoffs, projections for the IT services sector in FY25 show a promising rebound in fresher hiring.

Cisco, Microsoft and other tech giants are slashing jobs despite healthy revenues: Triggers behind the layoff culture, ways to safeguard your career and more

The wave of layoffs in the tech industry doesn't seem to be slowing down, even in the second half of 2024. Many employees have lost their jobs, with reports from the Times of India and Business Standard indicating that several well-known companies have laid off over 100,000 workers. This trend includes major tech giants like IBM and Microsoft, as well as several large startups.

IBM Announces Another Round of Layoffs

IBM is once again laying off thousands of employees, initiating a new round of cuts primarily affecting senior programmers and support teams. Earlier this year, the company had already reduced its workforce, and now it's continuing these layoffs under the guise of workforce balance. This could lead to single-digit layoffs in the company's global workforce. Recently, IBM also decided to shut down its research and development operations in China, which will result in layoffs for over a thousand employees.

Microsoft's Xbox Division Reduces Workforce

Microsoft has also trimmed around 50 employees from its gaming division, Xbox. Previously, during earlier layoffs, the gaming department wasn't affected, but now the impact is being felt primarily in corporate and support teams. Earlier this year, the company had laid off about 1,900 employees.

Cisco Announces Another Round of Layoffs

Cisco has continued its layoffs this year as well. Despite better-than-expected quarterly financial results, Cisco Systems announced a reduction of 7% in its workforce in August, affecting around 5,600 employees. Earlier this year, in February, the company had also laid off about 4,000 people. Cisco is now focusing on sectors like AI and cybersecurity. 

Qualcomm, Dell, and Others Continue Job Cuts

In August, renowned chipmaker Intel informed its employees through a memo that it would lay off over 15% of its total workforce, which amounts to about 15,000 employees.

 Bengaluru-based health tech startup Doji has let go of approximately 40 employees to reduce losses, stating that despite having operations spread across the country, its earnings have declined, and losses have increased. The company's focus is now shifting to expanding its business in the U.S. and other countries.

Similarly, the company WE Transfer has reduced its workforce by 75% as part of a strategy to increase profits. In July, the company was acquired by Lending Spans.

Semiconductor and telecommunications equipment maker Qualcomm announced plans to lay off 226 employees by the end of 2024. This comes after over 1,250 employees were let go a year ago, as the company faces current financial challenges.

Dell Technologies has indicated it will continue to cut its workforce until 2024, attributing this to a slowdown in personal computer demand, which has increased costs. To manage these costs, the company is resorting to layoffs.

The American company  Udemy, which runs online courses related to education, is set to cut its workforce by 50%. The company plans to hire lower-salaried employees, which is why this layoff is occurring.

Why Are Tech Companies Engaging in Massive Layoffs?

Several reasons are driving these layoffs. Due to ongoing global economic challenges, companies are resorting to layoffs as a means to cut costs. Many companies are also increasing their use of artificial intelligence (AI). Some companies state that they had over-hired during the COVID-19 pandemic, which is now leading to layoffs.

 

IT Companies to Hire 150,000 Employees

While tech companies globally are laying off thousands, the Indian IT sector is expected to see a significant increase in hiring this year. Those looking to build a career in this sector should prepare their resumes, as bumper recruitments are anticipated. According to a report from the Economic Times, fresher’s hiring is expected to increase by 100% compared to the previous financial year. The IT services sector is projected to hire 5.5 million fresher in the financial year 2025. Recently, the world's largest IT giant, Accenture, announced it had recruited 24,000 people in the second quarter. Meanwhile, major companies like Infosys, Wipro, and Tata Consultancy Services (TCS) have stated they plan to hire 40,000 fresher in the next financial year. HCL Tech also mentioned it would be hiring around 82,000 fresher.