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Though overall layoffs in the country reported by global
outplacement firm Challenger, Gray & Christmas on Thursday fell
14.7% in May from April, thanks to strong demand in the labor
market, the technology sector cut 4,044 jobs, up from the 459
between January and April.
It is the highest monthly total since December 2020 when tech
companies cut as many as 5,253 jobs.
"Many technology startups that saw tremendous growth in 2020,
particularly in the real estate, financial, and delivery
sectors, are beginning to see a slowdown in users, and coupled
with inflation and interest rate concerns, are restructuring
their workforces to cut costs," said Andrew Challenger, senior
vice president of challenger, Gray & Christmas.
U.S. tech layoffs and sector performance
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The impact of the Ukraine crisis, a four-decade high inflation
and rising interest rates has led to forecast cuts by companies
such as Snap Inc and Microsoft, while others like Meta Platforms
Inc have slowed hiring to rein in costs.
Fintech companies also announced 268% more job cuts in May than
in the first four months of 2022, the report from Challenger,
Gray & Christmas said.
However, the number of Americans filing new claims for
unemployment benefits unexpectedly fell last week. Initial
claims for state unemployment benefits fell 11,000 to a
seasonally adjusted 200,000 for the week ended May 28, the Labor
Department said on Thursday.
(Reporting by Tiyashi Datta in Bengaluru; Editing by Shinjini
Ganguli)
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