Friday’s employment report was strong: the US economy 261,000 new jobs were added in October, breaking analysts’ expectations at 200k, even though unemployment rose to 3.7%.

But don’t let the job boom lull you to sleep with a false sense of job security. Layoffs and interruptions are starting to pour in to the technology sector, which boasts some of the world’s most valuable companies. This is bad news for the economy as a whole.

What’s happening: Technology companies announce alarming numbers of layoffs and job freezes.

Amazon announced on Thursday that he is pushing for a pause in hiring companies. “We anticipate maintaining this hiatus for the next few months and will continue to monitor what we see in the economy and business to adapt when we believe it makes sense,” wrote Beth Galetti, vice president of human experience and technology at Amazon in a note for staff.

At the end of last month, Amazon forecast its revenues for the holiday quarter would have been lower than analysts expected, triggering a sharp plunge in stocks. Amazon stock has fallen by more than 47% this year.

▸ Apple reportedly froze employment in all areas except research and development. In a statement, Apple said it will continue to hire and is confident in its future, “but with the current economic environment, we are taking a very thoughtful approach in some areas of our business.”

Like other tech companies, Apple is worried about slower growth over the holiday season, higher interest rates, and declining consumer spending. Covid blockades in China are also painful production of the iPhone 14. Apple shares have fallen approximately 25% this year.

▸ Meta plans to start large-scale layoffs this week, the Wall Street Journal reported on Sunday. According to the report, the parent company of Facebook, Instagram and WhatsApp could shed thousands of jobs, with 87,000 employees, and the announcement could appear as early as Wednesday.

▸ Lyft said last Thursday he would be lay off 13% of their employees, or almost 700 people, as they rethink employment in the face of rising inflation and fears of an impending recession. “We know it’s going to be tough today,” wrote founders Lyft Logan Green and John Zimmer in a CNN employee memo. “We are facing a likely recession next year and carpool insurance costs are going up.”

In the announcement announcing the layoffs, Lyft said it would likely bear restructuring costs between $ 27 million and $ 32 million. “We are not immune to inflation and the economic downturn,” Lyft’s founders wrote in a note addressed to employees. Car-share shares fell by almost 70% this year.

▸ Internet payment giant Stripe will lay off around 14% of its employees, CEO Patrick Collison wrote a memo to employees on Thursday. “We were overly optimistic about the short-term growth of the internet economy in 2022 and 2023 and underestimated both the likelihood and the impact of a wider slowdown,” Collison wrote in the note. Last year, Stripe became the most valuable American startup with a valuation of $ 95 billion.

Chime, a privately held fintech company, also announced it will cut 12% of its 1,300 employees.

▸ Twitter on Friday announced extreme layoffs, noting offices will be blocked and access to badges suspended as new CEO Elon Musk will sever roughly half of the 7,500 workforce.

The most important: Top job numbers and third quarter company earnings continue to reflect an overall strong economy. But other companies will not be immune to the mitigating demand from consumers and companies that have technology companies I noticed.

The advertiser’s flight goes to Twitter

More bad news for Twitter: Elon Musk he said on Friday that the company has experienced a “huge drop in revenue” as growing advertisers hold their spending on the platform after its controversial $ 44 billion acquisition.

He attributed the decline to “activist groups putting pressure on advertisers even though nothing had changed in content moderation and we did everything we could to reassure activists.”

General Mills and the Volkswagen Group, which include Audi, Porsche and Bentley, have confirmed to CNN that they have suspended paid operations on the platform following the Musk acquisition. Mondelez International and Pfizer too reportedly joined this list.

On Friday, a group of monitoring organizations including the Anti-Defamation League, Free Press and GLAAD increased pressure on brands to rethink Twitter advertising. The groups cited Friday’s mass layoffs of Twitter workers as a key factor, citing concerns that Musk’s cuts would hamper the enforcement of Twitter’s electoral integrity policy along with another anti-hate speech policy.

Takeaway: This is a pivotal moment for Musk, who spent most of his week in New York trying to keep advertisers aboard Twitter. It doesn’t help that the uncertainty around the platform comes at the wrong time for ad-revenue-dependent tech companies. Both Google and Meta have cited lower ad payouts as a huge challenge in their latest earnings reports.

More potential problems in the supply chain

The threat of a US rail strike that could disrupt supply chains is still very real.

The two railway unions reached preliminary agreements with the railways in September ahead of the strike deadline, only for their members to vote against their ratification. Now, US Labor Secretary Marty Walsh says that without agreement, he expects Congress to step in and impose contracts on the unfortunate rank and file of the union.

#wave #technological #layoffs #economy

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