The company has also made it clear that the employees facing job loss do not have the option of being transferred internally to Intel. This step has been taken to reduce costs. Intel has announced layoffs at a time when thousands of people have lost jobs in the American tech industry. The main reasons behind this are economic uncertainty, decreasing earnings and rapidly growing Artificial Intelligence (AI) technology, which has increased the pressure on companies.
There have been layoffs in these companies too
It is not that layoffs are being seen only in Intel. Many big companies have also laid off their employees. Microsoft has made layoffs throughout the year. 2000 employees were laid off in January. Then in June 1000 people were laid off. In July also, people working in product and program management roles lost their jobs. People have also lost their jobs in Google’s parent company Alphabet.
Alphabet laid off at least 200 employees from its core teams in April, including four vice presidents and 25 directors. Apple laid off 614 people in California in May this year. Meta has also laid off thousands of employees over the past year to reduce its expenses. This trend of layoffs in big tech companies shows that a period of change is going on in the entire industry.
For what reasons are layoffs taking place in the tech industry?
Fear of economic slowdown and recession: Tech companies are struggling badly with the environment of economic uncertainty. The shadow of recession is also looming over them. The US Federal Reserve has increased interest rates, but inflation still persists. Inflation was controlled to some extent, but the cost of borrowing increased. Because of this, companies are having to reduce their investment and number of employees. Some companies have again started layoffs to save costs.
Impact of AI on Industry: There is also a growing impact of Artificial Intelligence due to job cuts. AI is bringing revolution in many industries, but because of it people are losing their jobs. Companies like IBM have banned recruitment for some roles. he/she believes that AI can handle these tasks. As tech companies move toward AI, workforce attrition in traditional roles is becoming more common.
More recruitment during pandemic: Tech companies grew rapidly during the Covid pandemic. The demand for digital services increased and then more recruitment was done to fulfill it. However, the boom caused by the pandemic has now started to wane, due to which companies now have more employees than required. Now companies are firing people from jobs to improve their financial condition.
Geopolitical tensions and instability in the world: In addition to the growing use of AI and economic factors, geopolitical instability, including the ongoing conflict in Ukraine and tensions in the Middle East, have had a cascading effect on the global economy. Due to this uncertainty, companies have become more cautious than before, due to which their budgets have been reduced and the number of employees has also been reduced.
