Stop Recording Yourself Being Fired… Why Tech Companies Are Laying Off Despite Booming Economy | The Millionaire Morning Show w/ Anton Daniels

We gotta get into tech layoffs. One of the things that we like to ask ourselves a lot of times is why are, why are tech companies laying off? Despite the fact, despite the fact that it seems like we still have a humming economy, they are really, really profitable. Everything is going on. Why are tech companies still laying off? Okay, so let’s get into that. Make sure y’all tap into the Patreon link is in the description as well as pin to the top of the chat.

Get into the bag chasers. Okay. Get into the bag chasers. We got stock club popping off this weekend. It’s going to be lit. Make sure you all tap into the Patreon link is in the description as well as pin to the top of the chat. Let’s get to it. You all said you all can’t wait to see the finished product. We’ll get there. We’ll get there. Hopefully they finish before the end of this segment.

Let’s go. Hi, Brittany. Hi. Thanks for meeting with me and Rosie. We have an important meeting today. We finished our evaluations of toy 23 performance. This is where you have not met classlight expectations for performance. We’ve decided to part ways with you. Yeah, I’m going to stop you right there. This is a viral video posted by Brittany Peach, a former employee of Cloudflare, a San Francisco based tech company.

The video posted on January 2024 and got so much attention that it may have kicked off a new subgenre of viral video. Watch this person get laid off in real time. The tech industry is again seeing widespread layoffs after a rough 2023. LinkedIn just laid off nearly 700 employees. Qualcomm is planning to cut more than 1200 jobs. Google, Amazon, and Snap are among the companies continuing to downsize.

And the start of 2024 seems no different as layoff announcements, especially in the tech industry, continue to make headlines. Units affected, they also include hardware engineering. I see you boys over there. But you know, the interesting thing about it is that I’ve been seeing these videos starting to really show up on my timeline. Also, I’ve seen a lot of videos where a lot of people are basically saying, yo, watch me get laid off or any of this or whatever.

Or people were saying, man, I think I’m about to get laid off because my friend got laid off. And now I’m about to get called into the office and people are recording themselves. It’s so weird living in this social media era in that people are recording themselves getting laid off. And those are the videos that are starting to become viral ad sales so far. Last night, CEO Senator Pachai told his workforce to expect more cuts.

An Amazon spokesperson did confirm those layoffs ahead of prime and Prime Video and MGM, saying in that memo that the company is making some of the cuts to prioritize investments for the long term. Layoffs are also plaguing industries like healthcare, banking and media. However, the tech industry is the one that’s been dominating the headlines. This layoff and everything that’s happened in tech I think is pretty eye opening.

You can have your dream job. You can have your, oh, it’s my dream to work for Microsoft or it’s my dream to work for AWS. And you get there and you realize, okay, it’s just like any other job. It’s a great place to be. There’s a lot of great perks, but at the end of the day, they can get rid of you like that. The layoffs to the start of 2024 signal a dramatic shift in the tech industry.

We’re going to continue to see layoffs happen as the future of work has changed, as the future of technology has changed, and as investors, the appetite for risk and growth versus profitability has dramatically changed as well. So why are big tech companies and other industries laying off tens of thousands of workers at a time when the US economy looks strong on paper? I always advise people never to become interdependent on it.

Just because you may get your dream job. A lot of people dream of, oh man, I want to work in Microsoft or Amazon or whatever and all of this stuff. And you get there and then you adjust your lifestyle to reflect it in reality. That doesn’t mean that you need to become interdependent on it. Listen, a title that you get from a job that’s there to make you feel good about yourself.

I don’t care anything about that. I was on a coaching call with somebody and somebody was asking me a question and it was like, anton, when you got to this part of your life, or how did it feel to become this thing or to become that thing or whatever, and to be able to add this into your resume or add this to your LinkedIn, and if you want the honest to God truth, it doesn’t feel like anything to me because I’m not impressed by titles.

I am impressed by money. See, a job is just a means or another way for you to actually source income. And we got to change our mindset behind that. It’s not about the company that you work at, it’s whether or not you’re leveraging the fact that you work at that company to get the maximum amount of benefits out of it. I don’t care about senior vp or getting into the C suite.

I care about the equity positions that come along with it. I care about the money. I care about the resources. So the minute that you all stop pedestalizing these companies and you all start thinking differently about what success looks like, you’ll have different results. I don’t care about the title. I only care about the money. The start of the Covid-19 pandemic was a dire economic event, at least at first.

The tech industry, though, boomed. In 2020, tech’s top seven companies added $3. 4 trillion in value. The Fed’s emergency moves to bolster the pandemic hit economy, like cutting interest rates to near zero, helped boost tech stocks. This move helped the tech industry to expand and went on hiring spree as people were confined to home. Amazon added the most number of employees during this golden period, peaking at 1.

6 million employees in 2021. If you rewind, before the layoffs, all the tech companies were really putting an emphasis on growth. And so capital was really cheap, so you could get loans, you could get money. Access to capital was really affordable. And then you see, as interest rates went up and you start to see that that growth in headcount didn’t translate to growth and profitability, and access to capital became quite a bit tighter.

You saw many companies start to hit the panic button, actually. It’s funny because they overhired, because they didn’t anticipate what was going to happen. And so it was historically normal for a lot of these companies. I’ll give you an example, like at Meta. I know some people that worked at Meta, and it was normal, for example, they would hire people for a project. The project would last for two to three years or three or four years, and then what would happen as a result of that was they wind up never laying off the people that they hire for that project.

But then that project would then die. And so a lot of people would just get reshuffled around in the organization, but they wouldn’t really give them anything else to do. So then you got a whole bunch of people in limbo making a bunch of money because the company is so profitable. It then covers up the fact that you still have an oversupply or an overabundance of employees that’s not really doing anything.

So you’ve seen a whole lot of people then stupidly go on TikTok, go on Instagram, and it was making videos like, oh, this is my day. I really don’t do anything. I make a whole lot of money. And then tech companies start getting winded at. And the minute that interest rates went up and profitability didn’t necessarily soar because the pandemic didn’t last as long as they thought that it was going to last or didn’t completely change the way that people did business.

Then they started thinking completely different about the amount of people when shareholders start requesting better results. So then you’ve seen something like meta, where they did a whole lot of hiring for a lot of projects, didn’t reallocate the engineers that they had on other projects. Then they started getting rid of the masseuses and the free lunches and all of this other type of stuff, right when they were interdependent on certain people in order for that organization to run, especially since a lot of people still wasn’t coming back into the office, you saw these thousands and thousands of people get laid off all at once.

And that was quite a shock. 80% of Twitter either left or quit or was pushed out, laid off, whatever you want to call it, and yet the website still runs. Do you think people are looking at Elon Musk and thinking, you know, what, do we really need all these people? I do give Elon Musk credit for this, for kicking off and making this acceptable with Twitter. But a lot of the big companies decided to get lean and efficient, and this is where you kind of start to see the incredible leverage of what these tech platforms really have, which is they didn’t need those people.

Right? They were hoarding the talent. It was an option bet, and it was a cheap one for them. Yeah. I ask every tech CEO, do you take inspiration for what Elon does? And they’ll say on the record, no, we don’t. We would never want to do that. But in the group chats, they’re all like, wow, that was an amazing move. The artificial intelligence hype of 2023 is starting to have real world effects.

In 2024, major tech ceos are doubling down their investments in AI. In January 2024, Meta CEO Mark Zuckerberg announced his plans to build an artificial general intelligence known as AGI. Hey, everyone. Today, I am bringing Meta’s two AI research efforts closer together to support our long term goals of building general intelligence, open sourcing it responsibly and making it available and useful to everyone in all of our daily lives.

All this investment in creating AI jobs, but at the expense of others. The recent report from indeed shows that the number of job posts containing gen AI terms has been surging. So there’s about a 500% increase in the number of jobs that mention generative AI. There’s about a 6000% increase in the demand from job seekers for these jobs. But there still is, I think, a mismatch the other way in that the total amount of demand for AI talent far outstrips the number of AI professionals.

Every company in every industry is trying to figure out how to use AI in everything they do. I mean, AI is going to create a lot more jobs as well. But at the same time, I would say that there will be jobs that will be automated. So you think AI has already, already hit the business effectively? Absolutely. Especially in the tech sector. I mean, they’ve been talking about it for years now.

The fact that you have more companies moving toward artificial intelligence, and they’re looking at the fact that as a public, be careful with these AI jobs, these AI titled jobs. You still need a fundamental understanding of what you’re doing from a development perspective. But don’t get caught up in trends. Don’t get caught up in the hype. Don’t overly spend a whole bunch of money in order to become educated in anything AI.

Make it a part of your regular growth pattern and growth curve and embrace it and become a part of the industry. But don’t chase trends. That’s the thing. Don’t chase trends. Just add to your skill set. All right? Opposed to paying somebody 200, $300,000 a year to do the job, I can actually use artificial intelligence to do the job that they used to be able to do. This AI thing is real.

It’s not going away, and they can’t have people holding them back. And so what they’ve been doing over the past year is finding places within the organization that they can trim so that they can get to a place where they’re shipping faster. So taking managers out and then engineers who are skilled for a previous generation of technology, they’re also leaving to make room for people who are more skilled for artificial intelligence.

AI is definitely playing a role in the layoffs that we’re seeing. Automation has increased efficiency for some of the workers who are able to utilize AI to make marketing decisions, to analyze data, to serve customers more efficiently and effectively. So AI is a paradigm shift that is changing the way people work and changing the priorities of tech companies. Right now, I don’t see that there’s a big impact from AI in these tech layoffs.

Some businesses have maybe cited that they’re trying to shift priorities and they’re letting some employees go to focus more energy on some of these generative AI tools. But I think it’s important to say that that’s very different than saying that companies are, well, we can let people go now because generative AI and all these tools are taking jobs. I think the bigger picture is that I’ve been able to be a voice for people who have gone through something similar.

The stories that I’ve received of people who were laid off 2030 years ago, and they still remember to this day how that, listen, this new generation of people, very few of them actually understand what it means to actually go through a real recession or a real layoff. A lot of them are coddled. Women like this don’t actually understand social media. And so what’s happening is they standing on it, but they don’t really understand what comes with it.

What really comes with it is she’s ruining her reputation for life. Because if I’m a hiring manager, and the first thing that we starting to do as hiring managers is we go and we look at how people operated in social media and whether or not they ever went viral. And if they went viral, what did they go viral for? We look at that and we say, well, we don’t want them a part of the culture anymore.

Made them feel, and it did not make them feel good. And I think that we should shed light on stuff like that so we can make a change. Otherwise, nothing will change. She don’t regret it now because she don’t know what the impact is, but she don’t realize the opportunities that she could possibly miss as a result of it. In my experience, the public sharing of things like one’s layoff, I think, is partially due to the fact of the rise of social media, such as TikTok, even YouTube shorts.

People are becoming much more comfortable with sharing their experiences. And oftentimes, when layoffs happen, people feel shame when they are being laid off. In reality, though, oftentimes if people are being laid off, it’s a failure of leadership of that company. Listen, layoffs is just a part of american culture. It’s a part of culture in general. It’s inevitable that at some point in your life, you could quite possibly lose a job.

Gone are the days where, and I don’t expect for you all to have loyalty to a place for an extended period of time either. But here’s the thing, you got to control your emotions. We see all of these job layoff videos are largely coming from women. And we know that women have a very difficult time controlling their emotions. And when something happens to them, then they lean into that and they get mad and all of that stuff.

You do not let that control your emotions. That can ruin your reputation and it could ruin your prospects. And stop letting your immediate circumstance determine what you’re going to do and how it’s going to impact your long term opportunities. It doesn’t make sense for you all to create a video of you getting laid off, putting your name on it, and letting that be attached to your person for the rest of your life.

Particularly for a company like Google, which over the past 25. But interestingly about that stat is like for example, Amazon CEO. I don’t even think that he got a bonus or anything outside of whatever his base pay was, which was less than a million dollars last year, right? Because the compensation of a company is tied to their ability to be able to add value to the stock and shareholders.

So any benefit in it is going to come as far as the performance of the company. When your compensation is directly tied to the performance of the company, you always going to do the thing that’s in the best interest of the company and not just for the employee. Five years is going to be the new normal. Data suggests an influx of layoffs in the tech industry starting from the second half of 2022 and peaking in 2023.

Some nontech sectors are also seeing widespread layoffs. A prime example is ups. The courier giant raised eyebrows by announcing 12,000 job cuts in January. The media industry isn’t immune to layoffs either. In 2023, the industry shed over 20,000 jobs, and 2024 looks no different as big names like Paramount, NBC, Sports Illustrated, the Los Angeles Times all have announced major job cuts in early 2024. The banking sector is also not shying away from cutting jobs.

Citigroup, Morgan Stanley, Deutsche bank are some of the big names that have already announced their layoff plans for 2024. It’s worth noting that even though these mass layoffs continue dominating headlines, labor market still seems strong. The US economy added 353,000 jobs in January, much better than the Dow Jones estimate for 185,000 jobs, with the unemployment rate held at 3. 7% against the forecast for 3. 8%. Experts are divided on whether the recent tech layoffs would trickle down to nontech sectors.

Looking at the current job market right now, there’s no evidence that we’re going to see any trickling. Obviously, kind of. The jury is still out. It’s still early to tell, but it’s interesting as we look back at 2023. 2023 was a year of a lot of layoffs in the tech industry, and we didn’t see any of that trickle out. Even within the tech industry, which is usually, the government usually defines it as the information sector.

We didn’t see a very high layoff rate, so we saw a lot of companies announcing layoffs, but those companies kind of carried an outsized share of the media, because then once we rolled it all up, there was maybe about 1% of employment that was being laid off. So really, ultimately, the overall rate of people losing jobs to layoffs remains near historic lows. It hasn’t yet trickled down to the rest of the economy as we’re seeing the stock prices really high, unemployment fairly low.

But at some point, if this continues, both companies and individuals are going to have to cut back spending, and that has consequences that reaches far beyond the tech industry. So ultimately, I guess what you all really have to understand is that whether it’s in good economic times or it’s in bad economic times, there’s always going to be shifts in the industry where people are affected. You have to make sure that you understand that it’s not about the job itself, it’s not about the title.

It’s about making sure that you get the most money possible and then allocating the majority of those resources over to the things or the places that’s going to continue to keep you sustained regardless of what happened with your job. I’m never going to become interdependent on a job or one industry in order to make sure that I maintain my lifestyle. It’s always going to be a long term play for me.

Everything is based off of a long term play. All right, so that’s my thing. .

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