Despite the increasing need for tech employees, record inflation and rising interest rates are causing tech companies to lay off their employees. Two companies that have been affected the most are Twitter and Meta.
With these layoffs, it’s no wonder that many tech employees feel undervalued. However, are the layoffs making them feel this way, or is there something much bigger? Why are tech employees still undervalued?
Tech Statistics
For the first time in 17 years, the average tech salary hit the six-figure mark, as stated by Dice’s tech salary report. However, 47.8% of employees still feel like they’re underpaid for their efforts. What may be the cause of that?
The 2020s have seen the rise of forced digitalization and work from home, fuelling the need for tech talent that organizations were willing to pay more. The rise of digitalization affected all of us.
Looking back, it was no wonder these tech employees were needed.
According to CompTIA, tech hiring grew as companies added around 80,600 employees through the first half of 2021. In February 2022, Amazon claimed that the company would double the largest base salary for corporate and tech employees.
Technology is already deeply ingrained in us and will only continue to expand. Analogization isn’t likely on a global scale.
The innovation of 5G, for instance, is just one example of a technology that will have widespread impact and potential revolutionary power for not just the tech industry but for everyday consumers too.
For instance, online casino operators are already positioning themselves to make the most of this new communications technology.
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So, it’s clear that tech employees are very much needed in our society. What’s happened between the beginning of the 2020s and now?
Twitter and Meta Layoffs
Despite the growing need for tech employees, companies like Twitter and Meta are laying off their employees. These companies enjoyed strong growth during the early 2020s, but they’re now facing a reality of high inflation and high-interest rates.
Not only that, but shopping patterns have changed, which means that these companies had to examine their spending on everything from adverts to investments.
At the beginning of 2022, Meta had around 90,000 employees. However, for the reasons stated above, 13% of employees, or around 11,000, had to be laid off. This is the first broad headcount reduction in the company’s history.
Meta CEO Mark Zuckerberg called this a sad moment. Zuckerberg had previously assumed that online activity in the early 2020s would increase. “I got this wrong, and I take responsibility for that,” he said.
Twitter has had it worse. Since Elon Musk bought the company, Twitter has estimated that it’ll have to lay off 7,500 employees. That’s 50% of Twitter’s employees! How could a company lose 50% of its employees?
In a tweet, new CEO Elon Musk claimed that there was no choice since the company lost over 4 million USD daily. He later claimed that laid-off employees were offered three months of severance.
Meta and Twitter aren’t the only tech companies forced to lay off their employees. Other companies that have laid off their employees include:
- Snapchat (1,200 of its 6,400 employees, or 20%)
- Lyft (nearly 700 jobs, or 13%)
- Redfin (closed home-flipping unit, 13% of employees)
- Stripe (laid off 14% of employees, left with almost 7,000)
Why Tech Employees Still Feel Undervalued
Despite rising salaries and an increasing need for employees, many tech employees still feel underpaid and are being laid off from their companies. With the layoffs and shortages, these tech employees are forced to make up for the lack of production by working longer hours.
They’re also expected to have higher outputs than usual. Extra work without more significant rewards leaves employees feeling underpaid and undervalued. It also doesn’t help that more tech employees are being laid off.
To make matters worse, tech employees feel they’re being paid an inflated salary due to inflation and high-interest rates. Less valuable money makes employees feel undervalued, too.
Tech employees feel undervalued because they’re at risk of being laid off, paid inflated salaries, and working harder than expected.