Many major tech company layoffs occurred in 2024. The tech giants that laid off their staff faced severe challenges, like increased inflation, which affected their turnover. Other challenges they faced include economic changes, rapid technological advancements, and significant changes in demand for their products and services.
These companies had to find a way to stay financially stable and competitive, and one option available to them was reducing their workforce. This article will discuss the largest layoffs in the tech industry this year and answer why tech companies are laying off.
Tech Sector Layoffs in 2024: An Industry-Wide Challenge
The tech industry has had a tough time in 2024. Many companies have laid off large numbers of their workers. By now, more than 130,000 people working in technology from 457 different companies have lost their jobs.
These layoffs have not just affected smaller companies. Major companies in the tech industry, like Tesla, Amazon, Google, TikTok, Snap, and Microsoft, have also laid off many employees. This year’s economic challenges for smaller companies were so severe that some have had to shut down completely, not just reduce their workforce.
Looking at the top 8 biggest tech layoffs in 2024, we can see the struggle. Even the biggest companies are struggling with the tech world’s economic challenges, a trend that began in 2023.
In 2023, about 2,000 tech companies laid off over 260,000 workers by the end of the year. The layoffs have not stopped in 2024. By mid-year, more than 81,000 tech employees had been laid off. Companies like Duolingo, Unity Software, and BenchSci laid off over 2,300 workers within the first few days of January. With the end of 2024 approaching, some of the most significant layoffs in tech have already been recorded, and there seems to be no end.
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Top 8 Largest Tech Layoffs of 2024
The following are the most significant tech layoffs so far in 2024:
1. Intel’s Workforce Reduction: A Move to Cut $10 Billion in Costs
Intel recently made a tough decision. The tech company cut back on spending by letting go of some employees. In early August, Intel announced it would reduce its workforce by around 15,000 jobs. This number is over 15% of its total employees.
This significant decision is part of the company’s goal to save more than $10 billion by 2025. Intel’s CEO, Pat Gelsinger, shared in an open letter how challenging this news was. The letter reads, “This is painful news for me to share. I know it will be even more difficult for you to read.” He emphasized that this was one of the most challenging days for Intel as the company made these critical changes.
2. SAP’s Increased Layoffs and ‘Ambition 2025’ Strategy
SAP recently had to increase the number of employees it was letting go. Originally, SAP expected to lay off about 8,000 workers. However, that number increased to an estimate between 9,000 and 10,000. This update was shared in July during the company’s meeting about its financial progress in 2024.
SAP’s CEO, Christian Klein, gave a speech during this discussion. He talked about how the company has stayed strong despite the ups and downs in the software industry and pointed out that even with all the challenges, SAP continued to grow in the second quarter of the year.
These layoffs are part of a bigger plan called “Ambition 2025.” This plan focuses on making the company more efficient. SAP hopes that this plan will help them focus on significant growth areas. These areas include using artificial intelligence for business to keep the company running smoothly and improve teamwork across departments.
ALSO READ: Cisco to Cut 7% of Workforce Despite Beating Quarterly Earnings and Revenue Expectations
3. Cisco’s Restructuring and Financial Implications
Cisco Systems, one of the big tech companies, has faced tough times and laid off over 9,000 workers. In an update in February 2024, Cisco’s CEO Chuck Robbins explained why they had to make these cuts.
The company noticed demand for its products and services was dropping, especially in telecom and cable areas. As a result, Cisco decided to cut some employees. The tech company laid off about 5% of its workforce, meaning about 4,000 employees lost their jobs then.
Cisco expects to spend about $800 million to make these cuts. The money will be spent on severance pay and other one-time costs associated with layoffs. Even though times are challenging, Robbins mentioned that Cisco still plans to invest in areas that could help it grow.
4. Microsoft’s Strategic Layoffs in Azure and Mixed Reality Divisions
Microsoft has also been laying off workers in 2024. This action occurred in Azure cloud services and mixed reality (VR/AR) divisions. So far, about 1,500 employees have been affected.
According to a Microsoft spokesperson, these cuts are part of a regular effort to manage the company’s structure and finances. Microsoft emphasized that while some areas are seeing reductions, it remains focused on supporting customers. The tech company also mentioned continuing to invest in projects and technologies with the most growth potential.
The layoffs in the Azure and mixed reality divisions reflect significant shifts in demand for tech services. While Azure remains an essential part of Microsoft’s business, there has been a slowdown in the growth rate of cloud services across the industry. This change is partially due to companies being more cautious with spending.
In the mixed reality division, which focuses on virtual and augmented reality, Microsoft has faced challenges as this technology is still emerging and has not yet reached mainstream adoption. Microsoft’s leadership has stated that these layoffs will help the company stay competitive and reallocate resources to the most promising sectors, like AI and cybersecurity.
5. Meta’s Layoffs in Key Departments for Strategic Realignment
Meta, the company behind Facebook, Instagram, and WhatsApp, is also one of the tech giants making major changes. In 2024, Meta had to lay off a large number of employees. These layoffs affected multiple departments, including Threads, recruiting, and legal.
In a statement to TechCrunch, Meta said that these job cuts are part of a bigger plan to make sure the company’s resources are focused on long-term goals. They want to invest in areas that will help the company grow. Meta has not provided full details on the number of employees affected, and the company also did not mention the eliminated roles.
6. Tesla
On May 7, 2024, Tesla entered its fourth week of layoffs. This happened after the company sold fewer Cybertrucks than expected. The company had been heavily promoting the electric vehicle, so the low sales were a major disappointment.
In April, news sources like Bloomberg and Electrek reported that Tesla’s CEO, Elon Musk, sent an internal memo stating that about 10% of the company’s workforce might lose their jobs. This could mean around 14,000 employees might be affected.
Earlier in 2024, Tesla reported selling only 386,000 Cybertrucks in the first three months of the year, even though it produced more than 430,000. This gap between production and sales may have influenced the company’s decision to cut costs through layoffs.
These layoffs mainly impacted Tesla’s software, engineering, and service teams. Based on data from layoffs.fyi, a website that tracks layoffs in the tech industry, Tesla’s job cuts have been the largest since the COVID-19 pandemic in 2020.
7. Apple
In 2024, Apple laid off more than 600 employees after shutting down a project to create a self-driving electric vehicle. The affected employees included those who worked on the hardware, managed the machine shops, and helped with product design.
For those not laid off but involved in this project, Apple advised them to apply for different roles within the company. In a memo to the staff, Apple’s CEO Tim Cook and COO Jeff Williams shared that employees previously working on the self-driving vehicle project would be shifted elsewhere.
They will work on artificial intelligence (AI). This round of layoffs was one of the biggest for Apple since the COVID-19 pandemic. Before this, Apple had avoided significant layoffs, especially in 2023, when Tim Cook expressed interest in hiring AI experts in the UK.
8. Google
In May 2024, Google laid off 200 employees. This move was part of a plan to help secure the company’s financial stability over the long term. Some jobs were moved to other countries like India and Mexico, and others were moved closer to Google’s partners to save costs.
This decision affected some key teams, including those working on safety for online platforms and core products like Python and Flutter development. Asim Husain, Google’s vice president, recognized that these layoffs created uncertainty among the remaining employees.
He explained that the entire software industry was going through significant changes. These changes occurred due to the rise of AI technology, especially generative AI, which allows computers to create new content.
These recent layoffs came just after Alphabet, Google’s parent company, announced its first dividend following a strong performance in early 2024. This round was not Google’s first in 2024; earlier in the year, the company had also laid off hundreds of employees in its augmented reality, Pixel, and Nest divisions.