By Morf Morford, Tacoma Daily Index
Trouble in the tech industry
No business trend lasts forever, especially one based on projections and pandemics.
Tech titans and investors (and most of us) misjudged how long the pandemic-driven e-commerce boom would last. From Zoom to Amazon Prime (and dozens more) fortunes were made – but not sustained.
The question with any trend is how permanent – or transitory – those changes are.
Working and buying online was central, if not essential, for a couple years.
But has the internet changed how we shop, work and relate on a permanent basis? It doesn’t seem like it.
Here are a few of the numbers;
Meta (aka Facebook) announced layoffs of 11,000 employees (that’s about 13% of its 87,000 workers worldwide).
Meta joined Twitter, which had earlier announced its intention to fire about half of its staff.
Lyft announced plans to cut 13% of its staff, or about 700 jobs.
Online payments giant Stripe laid off roughly 14% of its staff, about 1,100 employees
Coinbase announced a cut of 18% of full-time jobs, around 1,100 people. Like several other cryptocurrencies, Coinbase lost over 80% of its value this year.
Shopify announced it laid off 1,000 workers, which equals 10% of its global employees.
Besides two rounds of layoffs, Netflix’s stock is down 58% this year.
Microsoft announced its slowest revenue growth in more than five years as of the quarter that ended Sept. 30.
Like Coinbase (and several others) Snap has lost 80% of its value this year which led to the lay off of 20% of its workforce, which equates to over 1,000 employees.
Retail brokerage firm Robinhood cut 23% of its staff in August, after slashing 9% of its workforce earlier in the year.
Intel is expecting to eliminate up to 20% of its employees.
Oracle, HBO, Peleton, Docusign, Zillow, Redfin and even Apple, have announced current or near-future job cuts.
Hiring in these companies (and many other tech businesses) dramatically expanded over the pandemic years. That growth, to put it mildly, has not been sustained.
Many tech companies hired workers to meet demand as much of our economy moved online. And then the inevitable happened.
Several of these companies have already laid off too many – Twitter, for one, is already frantically re-hiring some of its laid off workers.
The biggest loser
In November, Amazon became the world’s first public company to lose a trillion dollars in market value.
Among other things, Amazon is expecting to lay off about 10,000 employees – about three percent of their corporate staff.
The world’s largest online retailer has been facing a dramatic slowdown in e-commerce growth as shoppers realized that they preferred shopping at brick-and-mortar outlets as the pandemic declined.
Economic uncertainty, soaring costs (mostly related to fuel and transportation) and unexpected raises in interest rates have made uncertain territory even more treacherous.
To put it simply, circumstances seem to have shifted and become aligned against the entire industry. The drop in Amazon’s stock value, like many others from Apple to Netfix has been attributed to rising inflation, tightening monetary policies and a steep drop in earnings. No one expects any of those market forces to change any time soon – if ever.
Move fast and break things
Many of the companies in trouble in late 2022 lived by Facebook founder Mark Zuckerberg’s now-famous motto: “Move fast and break things.”
The phrase was intended to inform internal design and management processes, but it came to capture a larger philosophy in terms of how entrepreneurs regard disruption: more is always better.
Until it isn’t.
With the pace and scale – and intrusiveness of recent technologies – from genomics, blockchain, drones, to 3D printing (and much more) the stakes are far higher – and the impact on our lives far deeper and more enduring than any previous encounters with man-made devices and processes.
Yes, these technologies allow and equip us to “Move fast and break things” but is that what any of us really want?
There is a truism in any technology; every change, every development, carries within itself the seeds of its own destruction.
“Move fast and break things” is the ethical framework of a toddler. Anyone could do that. It is building things that last, and are worth keeping, that takes courage, strength and vision.
“Move fast and break things” is just another way of saying “be rash and irresponsible”.
“Moving fast” means that millions, billions, even trillions of dollars can be made – and lost – at the click of a few keys. And to “break things”? As every parent knows, any toddler or teenager can do that.
To move slowly and build things that are worth taking care of is the mark of a true craftsman.
