Aussie Designers Caught Up In Big Tech Layoffs
Aussie designers are among the latest casualties of the layoffs sweeping across the tech industry. Big names like Google, Facebook, and Amazon have all slashed jobs in recent months, and now those cuts are being felt Down Under.
While the exact numbers are unknown, it’s estimated that hundreds of Australian designers have lost their jobs in recent weeks. For many of these workers, their livelihoods depend on the health of the tech industry. So what is causing the tech turmoil and what is in store for designers in the tech industry in 2023?
The tech layoffs story so far
In the past few months, sadly, a slew of tech industry layoffs have left many jobless and uncertain about their future. Although the majority of job losses have been felt in the United States, many Australians employed by these companies have also experienced significant impacts.
Netflix laid off 450 people in two separate batches during May and June last year. At the same time Snap Inc., released over 1,200 employees – roughly 20% of its staff. Shopify also dropped approximately 1,000 members from its team globally.
In November, Meta – the owner of Facebook, Instagram and WhatsApp – announced devastating news regarding their staffing numbers. The organisation had to let go an overwhelming 11,000 employees which equated to 13% of their staff. Twitter followed suit with a similar announcement as they cut nearly half of their 7,500 personnel worldwide. Unfortunately, dozens of staff from Sydney’s Twitter team were reportedly included in these redundancies.
In January, Amazon declared they would be slashing over 18,000 jobs and Microsoft soon followed with an announcement of 10,000 redundancies. This followed two earlier rounds of firings. Similarly, Salesforce made 8,000 employees redundant globally. The company was believed to have about 2700 Australian employees prior to the layoffs but now lists only 1,800 local staff on their AU website, indicating that they may have recently shed around 900 local workers.
Back at home in Australia, a swathe of smaller tech businesses have also been shedding employees. While the numbers don’t come close to the hundreds of thousands shed by international tech giants, the recently tight local job market is definitely showing signs of loosening.
Why are the tech layoffs happening?
What’s causing these sudden job losses in the seemingly evergreen tech market? Analysts attribute it to a combination of decreased customer spending due to a looming recession and overstaffing during the pandemic. Companies that were quickly expanding amid booming demand for their products and online services are now struggling to support both their costs and their staff.
While the pandemic hiring-spree and recent economic downturn are obvious contributing factors, there may also be other motives for these large scale tech layoffs. As Forbes reports, there are indicators that AI may have a role to play also.
Warnings have been growing louder over the last few years, that the AI revolution, and resulting unemployment, is on our doorstep. With AI tools already creeping into many industries, along with massive investments in AI by companies like Google, it isn’t too big a stretch to assume a connection between AI and these layoffs. At a time when businesses need to cut spending to retain profit margins, replacing staff with AI has obvious financial benefits. But, the fact that these large tech firms seems to be letting go of more experiences staff over cheaper (and easier to replace) junior employees doesn’t add much weight to this theory.
What it all means for designers
Designers form a big chunk of any tech company’s workforce; they are essential to the success of any new product or service as they imagine and refine user experiences that drive customer engagement and revenue growth. Design-driven businesses have historically achieved incredible successes due to their focus on design excellence – something that is only possible if you have experienced designers on your team.
So, it goes without saying that layoffs in the tech industry equate to inevitable job-losses in the design sector. While a detailed breakdown isn’t currently available, it’s estimated that there have been approximately 235,000 big tech redundancies since the start of the pandemic. One would assume a decent percentage of those were UX, UI, web and product design roles. However, a quick scan over the lists of job cuts at https://layoffs.fyi/ reveals a slightly different story.
Of the redundancy lists we analysed, less than 10% of those laid off were designers.
While this underrepresentation of designers among those laid off could be due to many factors, it is a little surprising. Especially given the reported mass-layoffs of innovation and R&D teams, which typically comprise of a high percentage of designers. Perhaps the layoff lists at Google and Meta (not publicly available) tell the rest of the story.
So, while the Australian job market may have avoided the worst of the “tech-wreck” and designers may have faired better than other employees, there is no doubt we are seeing an impact on the job market. With big tech flooding the market with candidates, it’ll likely slow down wage growth in the design sector somewhat.
But it’s not all doom and gloom for designers. Big tech’s loss may be a huge gain for smaller businesses, who were practically priced out of the staff market during the pandemic hiring spree. As job vacancies close at the larger companies, opportunities are arising at more boutique firms. While they may not come with the overinflated 2021 big tech salary packages, many find working in smaller team far more rewarding. The tech bust may end up being a boon to job satisfaction in the long run.