New Delhi: The tech sector has been hit hard by layoffs, with over 32,000 employees affected so far. But what’s behind this troubling trend? Let’s take a closer look at the factors contributing to the job cuts.
Various factors contributed to this wave of layoffs, including mismanaged recruitments, struggles with ad revenue, and the overarching impact of a faltering economy that compelled companies to resort to cost-cutting measures, often through workforce reductions. (Also Read: Bengaluru Techie Laid Off A Day After Tweeting About Recession In Tech)
AI And ML Transformation Adds To Job Insecurity
Beyond the economic downturn, the introduction of artificial intelligence (AI) and machine learning (ML) models emerged as a significant catalyst for job cuts. This trend persisted into the current year, further exacerbating concerns regarding job security across various sectors. (Also Read: Latest SBI FD Rates 2024: How Much Return Will You Get From Fixed Deposit? Check Here)
White-Collar Jobs Face Threats
A survey conducted by US firm Challenger Gray shed light on the growing threat posed by AI to white-collar jobs.
Professionals in diverse fields, ranging from programmers and company management to lawyers, accountants, finance and insurance professionals, consultants, and others, found themselves at risk of displacement due to automation.
Staggering Increase In Layoffs
The data from the report reveals a staggering increase in layoffs, with US companies announcing 82,307 job cuts in January alone, representing a substantial 136 percent surge from the previous month.
Within this figure, the financial sector led in layoffs, reporting 23,238 job cuts, the highest recorded since September 2018. Not far behind was the technology industry, with 15,806 cuts, indicating a notable escalation from the preceding month.
Challenges Across Sectors
The ramifications of automation and economic challenges extended beyond the tech and financial industries. The food production sector grappled with 6,656 layoffs, largely attributed to escalating costs and increased automation.
Similarly, the retail sector experienced 5,364 job cuts, reflecting a significant uptick compared to previous months. While overall layoffs in the media sector decreased, news outlets saw a surge in job cuts, with 528 layoffs in January, marking the highest monthly total in nearly a year.