January 31, 2023

Layoffs in the tech industry are a big story across the country.

Employers who have expanded rapidly in recent years have been quick to shut the hatches in hopes of weathering an economic downturn fueled by the end of easy money and record-breaking inflation not seen in decades .

Tripp Mickle, tech reporter for The New York Times, writes that this was a major awakening moment for a generation of workers who have never experienced a cyclical economic crash. Not so much for older people. Listen to the story above or read the transcript below.

This transcript has been edited slightly for clarity:

Texas Standard: Layoffs.fyi reported that nearly 200,000 tech workers have been laid off since early 2022 — 50,000 of them in the last few months. But, as you may have noticed, not everyone experiences this nightmare in the same way. Can you tell us a bit more about the generation gap here?

Trip Mickle: Yes, it’s fascinating. If you pick up the phone like me and reach out to people from say Gen-X who were early in the workforce in the late 90s/early 2000s, they came into the tech sector when it was super hot – the place to be – and was then swept into the dot-com bust. Many of them have been released 1 to 3 times in a few years. And her outlook on work and her career has really been shaped by that experience — so much so that I spoke to this one guy, Brian Pulliam, who does a gut check every year and says, ‘If I get fired this year, what will I do do?”

And that was really shaped by that experience years ago, when a lot of millennials and a lot of people in Generation Z came into the tech industry during this decade-long boom that started around 2010, when companies like Apple and Microsoft and Google came to the forefront of the global economy. And they viewed technology as an industry impervious to retreat. You found something else. It’s just that they figured it out later in their careers than those on the Gen X side.

What does that mean practically? If you weren’t anticipating layoffs, chances are you don’t have a safety net, or at least haven’t thought much about “what if I was fired within the next year,” as you used to say workers thought?

To the right. I mean, I think it just makes them reconsider their assumptions about the tech industry. You know, a lot of these companies were selling a lifestyle, not just a career. These were jobs where you could do your laundry. You could get free coffee from a really high quality pour over coffee place. And many of these companies still have tons of cash. So when they make those cuts, it forces people to realize that the place I work might not be quite as janitor as I assumed walking in the door.

But you know, you’re thinking about some of these companies — Google, Meta, Amazon, Apple — which in turn have huge cash reserves. What about the expectations that younger workers have of older workers when it comes to how those reserves are spent?

Yes, I mean, the cash reserves are really something that investors see as something they are entitled to. I mean, they are the stakeholders in the company. They’re the ones who believe the money should come back to them, whether it’s through buybacks or dividends. And that’s what can create a disconnect between what workers say and what shareholders assume and what actually is some sort of reality of the situation. And I think that’s what caused some workers to look at the register and say, ‘Wait, why are we cutting staff? We have enough money in the bank.” But that’s not how businesses normally work.

You could say that younger workers are more adaptable. I mean, they know more about the gig economy, ways to make ends meet, traditionally at least, have fewer responsibilities than older workers who are more likely to have a house to pay for and of course family responsibilities and stuff. How is this felt across generations?

Well, that’s fascinating. You’re right. They’re more adaptable, but they’re also in a very adaptable economy because when you look at the numbers and beyond the headlines and the clamor about layoffs, there’s still a lot of tech hires overall. And so the average worker finds a new job within three months of being laid off – many of them still in the tech sector.

There are also plenty of opportunities in more traditional industries — be it finance, healthcare, or even government. They all need tech people, and they couldn’t always recruit those people because the tech companies pay so much. It’s hard to be competitive and they’re now finding an opportunity to attract some of these tech people into their industry to help their businesses as well.

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