Layoffs declined, recruitment remains on hold in tech industry: Report
The tech sector had significant labour cutbacks during the economic downturn, motivated by the need to decrease costs and handle the pandemic-induced staffing glut.
Layoffs declined, recruitment remains on hold in tech industry, the research says
Despite a boom in interest in artificial intelligence, which necessitates specialized skills, tech firms are not currently ramping up hiring efforts following massive layoffs over the last year.
However, according to Jefferies research, layoffs in the tech sector appeared to slow in June and July, and the trend is projected to continue with even fewer job cuts this month.
According to Bloomberg, the analysis is based on both internal data and information obtained from the job marketplace TrueUp.
The tech industry was among the first to undergo major and rapid labor reductions during the economic crisis. Companies were forced to cut costs and manage the surplus labour that arose as a result of the pandemic-induced boom.
According to both Jefferies and TrueUp, the tech sector has seen a total of 342,671 layoffs so far this year. This amount much outnumbers the 243,075 layoffs registered in the previous year. A similar tendency can be seen in layoff statistics.
According to the data, the number of available positions in the tech sector is rather low, reflecting trends in the broader economy that hint to a minor decline in demand for labor.
According to a recent government study, employment vacancies in the United States fell in June to their lowest level since April 2021. Concurrently, layoffs have dropped to their lowest level since the end of the previous year, indicating that firms are wary about decreasing their personnel.
“The shifting workforce dynamic will require lower-skilled workers who are being squeezed by AI to re-skill and up-skill for new job opportunities,” Jefferies analysts led by Brent Thill wrote in a note accompanying the report.
The difficulties of the continually strong job market have made forecasting annual earnings for recruiting organizations difficult.
During a recent earnings call, M. Keith Waddell, CEO of global employment firm Robert Half, stated that clients have grown “more cautious, more conservative, and more tentative,” making forecasting a difficult task.
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