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Big tech slows down layoffs, without yet raising hiring

The technology have slowed down finally the rhythm of layoffs which they had for several months. This, due to the rise of relatively new fields in the business world and of many technologies, such as Artificial Intelligence, could lead one to assume that they would soon level their workforces by hiring experts in these new fields for their projects. But, at least for now, it seems that they are not interested in doing so yet.

Meanwhile, tech sector job cuts appear to have eased in June and July. And everything indicates that the trend will continue in August, with an even lower level of layoffs than in the previous two months, according to Bloomberg.

The technology sector has experienced some of the deepest and most drastic headcount reductions over the last year. In addition, they have not been limited to one region, but the layoffs have occurred in practically the entire world. This is due to the slowdown in the economy, which forced companies to reduce costs and eliminate any excess staff they may have. In many cases, this excess was generated during the pandemic, when more than a few technology companies hired thousands of employees, which they sometimes did not need.

So far, in companies in the technology sector there have been more than 340,000 layoffs so far this year, according to several specialized employment consultancies. To these we must add the more than 240,000 registered throughout the past year 2022.

As we have mentioned, meanwhile, the number of job offers in the technology sector has not grown much. This trend is in line with what is happening in other sectors, which suggests that the demand for workers has softened in all economic sectors.

In the United States, for example, the supply of jobs fell last June to its lowest level since April 2021. At the same time, layoffs in technology also fell to their lowest level since the end of last year, which which indicates that companies are beginning to be more reluctant to layoffs.

According to him Jefferies Consulting Analyst Brent Thill, » changing workforce dynamics will require lower-skilled workers, who are under pressure from AI, to upskill and get more training for more new job opportunities«.

The particularities of the labor market, which still shows signs of resilience, have made it even more difficult for recruiting companies to predict annual income. All because, as we have hinted, their clients are more cautious and conservative when it comes to rehiring.

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