it should only affect USA. most companies depend on investor money (some to live, like tsla, uber. some because of bonuses tied to stock prices)
those companies know that investor money is directly related to FED rate. if its zero, they get invested, if its high, people will put money to work elsewhere.
they only lever they have to control fed rate is unemployment. they know they are hurting their business by laying off people they fought to acquire, but their incentives for investor money is higher than anything else.
so their plan is to increase unemployment in the USA so fed lower rates so investment money keeps flowing.
So your saying that at a bunch of publicly traded tech companies the csuite gathered in secret meetings and the conversation was?
CEO while shining his monocle: "what can we do to lower the fed interest rate?"
CFO: "We can fire a bunch of our employees"
CEO: "But Total nonfarm payroll employment rose by 517,000 in January even with all the tech layoffs. We wont even make a blip "
CFO while twirling his mustache: "yes but us firing 10,000 will make us feel better at the country club and its sending a message that I'm positive the board of the Fed will listen to because we are very important"
CEO: "You're right, lets do it!"
Head of HR: "I'm asking this question while sitting on stolen land. How does firing 7% of the poors sound?"
Are you seriously implying that the few 10’s of thousands of people laid off in big tech is some kind of conspiracy? Do you know how little impact that has on the nation’s overall unemployment numbers?
Rising interest rates is not just an American phenomenon. The European Central Bank is raising rates as well, as are many central banks around the world.
I think another component is that lowing costs will have an immediate impact on quarterly financial reports while firing devs will mostly have a delayed impact on revenue.
When many companies are juking the stats by lowering costs with layoffs then it puts pressure on all other companies to do the same because they are all competing for finite investment dollars.
1. Most large US companies have developers outside US too.
2. Inflation is high the world over and central banks have hiked rates everywhere.
3. An individual company has a negligible impact on unemployment figures. If you're thesis was actually true, it makes no rational sense for a company to layoff workers.
There is definitely a re-balancing of the employment market. I assume its because of capital drying up. Tech workers labor is more to build things that pay off in the long run (in theory) I think the lower minimum wage jobs tend to be more operating costs.With interest rates rising there is less capital to build stuff that will take years to pay off. More focus on just keep things going as is by throwing bodies at the problem. Im not sure. Honestly I would have thought that tech would have come in more demand as salaries rose to make the people you are paying for more efficient.
What impact does an individual company have on unemployment figures? If the only point of layoffs was increasing unemployment, what incentive does an individual company have for laying off employees?
It wasn’t just one individual company in this case, but a seemingly coordinated cabal like industry-wide action. Strength in numbers. A “corporate union” action if you will. All highly profitable companies sitting on mountains of cash. The layoffs were an exercise in capital asserting dominance over labor and financial engineering.
those companies know that investor money is directly related to FED rate. if its zero, they get invested, if its high, people will put money to work elsewhere.
they only lever they have to control fed rate is unemployment. they know they are hurting their business by laying off people they fought to acquire, but their incentives for investor money is higher than anything else.
so their plan is to increase unemployment in the USA so fed lower rates so investment money keeps flowing.