Tech layoffs: Over 90,000 lost jobs between January and May 2024

Despite ongoing layoffs in the tech industry in 2024, the total number of employees let go in the past five months is significantly smaller compared to 2023, indicating that the negative trend is finally slowing down.

According to data by Layoffs.fyi, tech companies have laid off 90,916 employees year-to-date led by 317 companies, which is half the number reported during the same period last year.

After peaking at the end of 2022 (165,269) and the beginning of 2023, the wave of tech industry layoffs has gradually weakened. However, 2023 still marked the highest number of layoffs ever recorded in the industry.

According to Layoffs.fyi data, in 2023 alone, tech companies laid off almost 263,000 people, driven by industry giants like Google, Meta, Microsoft, and Amazon. This year, the trend appears to be slowing, with significantly fewer job cuts reported.

Over the past five months, 330 tech companies have implemented cost-cutting measures, leading to job cuts almost three times less than in the same period last year.

An analysis by months shows that nearly 60% of all job cuts, or roughly 50,000, occurred in January and April, the two worst months for tech layoffs in 2024.

January alone saw over 31,000 job cuts, less than half of the figure reported in January 2023. April brought another 22,000 layoffs, slightly more than the 20,000 reported in April 2023. The downsizing trend continued in May, with 9,654 job cuts, which is 5,000 fewer than in May 2023.

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The transport sector hit hardest with 17,000 layoffs

The transportation sector has been the hardest hit in 2024, accounting for one-fifth of all tech layoffs. The sector reported over 17,500 job cuts year-to-date, a 70% increase compared to the same period in 2023.

The hardware industry followed with nearly 10,000 layoffs in the first five months of the year. The consumer and retail sectors also saw significant cuts, with 7,750 and 7,720 layoffs, respectively.

Statistics also reveal that the cumulative number of job cuts in the tech sector has reached alarming levels. Since the beginning of 2021, tech companies have laid off more than 720,000 people.

This figure underscores the volatility and unpredictability of the tech industry, which, despite being a driver of innovation and economic growth, is also susceptible to rapid changes and downsizing.

These layoffs reflect broader market dynamics, including shifts in consumer behaviour, technological advancements, lack of corporate governance , lack of market research, and economic pressures.

Why this matters

The high number of layoffs has substantial implications for the workforce and the economy.

Tens of thousands of skilled professionals losing their jobs can lead to increased unemployment rates, reduced consumer spending, and potential long-term impacts on the labour market.

The ripple effect of such widespread job cuts can affect not only those directly laid off but also other sectors dependent on the spending power and economic contributions of these workers.

The data serves as a critical signal for policymakers and industry leaders. It emphasises the need for proactive measures to support displaced workers, such as retraining programs, unemployment benefits, and initiatives to stimulate job creation within and beyond the tech sector.

By paying attention to these statistics, stakeholders can better understand the underlying causes and work towards sustainable solutions to mitigate the impact of such layoffs.

In another light, the data highlights the importance of strategic planning and risk management for tech companies. Firms need to anticipate market shifts and adapt accordingly to avoid large-scale layoffs. This might include diversifying product lines, investing in emerging technologies, and maintaining flexible business models that can withstand economic fluctuations.

Interestingly, the industry is showing signs of stabilisation – except for sudden policy changes. Understanding and analysing layoff data is crucial for grasping the broader economic impacts, guiding policy decisions, and fostering a resilient and adaptive workforce.