The Tech Industry's Legacy: Creating Disposable Employees 271
An anonymous reader writes: VentureBeat is running an indictment of the tech industry's penchant for laying off huge numbers of people, which they say is responsible for creating a culture of "disposable employees." According to recent reports, layoffs in the tech sector reached over 100,000 last year, the highest total since 2009. Of course, there are always reasons for layoffs: "Companies buy other companies and need to rationalize headcount. And there's all that disruption. Big companies, in particular, are seeing their business models challenged by startups, so they need to shed employees with skills they no longer need, and hire people with the right skills."
But the article argues that this is often just a smokescreen. "The notion here is that somehow these companies are backed into a corner, with no other option than to fire people. And that's just not true. These companies are making a choice. They're deciding that it's faster and cheaper to chuck people overboard and find new ones than it is to retrain them. The economics of cutting rather than training may seem simple, but it's a more complex calculation than most people believe. ... Many of these companies are churning through employees, laying off hundreds on one hand, while trying to hire hundreds more."
But the article argues that this is often just a smokescreen. "The notion here is that somehow these companies are backed into a corner, with no other option than to fire people. And that's just not true. These companies are making a choice. They're deciding that it's faster and cheaper to chuck people overboard and find new ones than it is to retrain them. The economics of cutting rather than training may seem simple, but it's a more complex calculation than most people believe. ... Many of these companies are churning through employees, laying off hundreds on one hand, while trying to hire hundreds more."
Real reasons for the layoffs (Score:5, Informative)
Free Market (Score:2, Informative)
This is just the free market in action, treating employees as any other resource: fungible, consumable, disposable, replaceable.
I've spent my career in high tech and enjoy it, but I don't recommend it as a career path to anybody I know.
Re:It all comes down to payroll (Score:5, Informative)
nope he has already been promoted/layoff and no longer is required to justify his mistakes. we live quarterly reports by quarterly reports.
Re:It all comes down to payroll (Score:3, Informative)
No, he'll get promoted before that happens due to the savings. Then it's the fault of the next guy who had nothing to do with it, but fuck him, right?
Re:Turn about's fair play (Score:4, Informative)
Sadly there is a double standard. If you have only been at your last couple jobs a couple years you get a lot of inquiry and scrutiny to justify yourself. Companies seem oblivious to the fact that they get rid of folks like tissue paper, while demanding the new employee act like they want to join for life.
The truly awful part of the shift mentality to "we are all temporary employees" is that it has infected companies well outside tech hubs. In Silicon Valley it is pretty easy to leave one collapsed startup and find something else to pay the bills, or for companies to scoop up extra people as you expand. Cost of living, as well as cost of hiring are a bit insane, but it allows workers lots of backup options, and companies a near sure fire way to expand simply by throwing money at the problem.
Tech companies elsewhere have joined the crowd in using layoffs as a way to cut the training budget and goose the stock price at will, but the laid off workers often find they are in a desert of opportunity leading to very long stretches of unemployment. Likewise, those left inside the company cannot often get enough decent local talent on the next up swing, making rehiring and rebuilding a group a long and painful process, only to have it all undone the next time there is a bad quarter.
Re:Turn about's fair play (Score:4, Informative)
To some degree, this is handled by unemployment insurance premiums.
Most unemployment offices, in addition to the direct unemployment benefits, have retraining programs that often last well beyond when the direct benefits expire.
For example, I started my masters' degree part-time when I was still working at my first job. 4 weeks later i got laid off.
I got the standard unemployment benefits (26 weeks I think???) but when those ran out, I was still eligible for New Jersey's tuition waiver program (free tuition at a state school with some limitations - you're last in priority when classes fill up pretty much but that wasn't a problem in an EE graduate program) for the entire remaining duration of my M.S. program.
Re:Insert Subject Here (Score:4, Informative)
Same here - Fiserv for starters. They have a layoff every two years at some random month early in the year (it's been derisively termed the "layoff lottery").
The only clue we got was the Friday before, they told all the remote/home workers that from now on, all work will be done in-office, starting Monday (this ensures that you bring all your stuff in so they don't have to worry about recovering it.) Come Monday morning, they began discreetly walking up to desks, quietly asking the victim to come have a chat with them in the office. If you're low-man on the seniority totem pole (as I was at the time, since the department was small and had low turnover), you were guaranteed to be unemployed before lunch that day.
Funny thing is, not six months later they were hiring for the same damned positions that they laid a number of us off from. Word quickly got out in our local tech community though, so recruiters were met with a wall of silence when that company's name was mentioned.
Fortunately for Fiserv, the company is able to get around that by instead bolstering their offices in Norcross (near ATL) and Dallas (larger cities with larger tech communities).
Unfortunately for them, websites like glassdoor.com exist, and anyone with half a brain stops there first before interviewing (unless desperation or similar circumstances dictate otherwise).
Re:Time for a UNION! (Score:5, Informative)
I don't know about Japan, but these workers rights in France and Germany were largely the work of unions.
Re:It all comes down to payroll (Score:5, Informative)
As a former H1-B visa holder, current lawful permanent resident, and eligible for U.S. citizenship, you should know that the LAW requirs H1-Bs to be paid at least 90% of the prevailing wage, the employer to handle their INS legal expenses, AND bear the cost of sending them and their family home when they are layed off or their visa expires. H1-Bs generally cost MORE than locals, with all the extra hassles.
Now, where I would likely agree with you is that many companies BREAK those laws to bring in cheap labor, something which I would opose as well.
Re:Result of the Glengary Speech . (Score:4, Informative)
No, it's based on the true belief that only success produces the rewards to pay you with. If you want to paid for trying but not succeeding, you have to take the pay out of the rewards gained by the people who actually succeeded.
The world doesn't pay off on a "good try." That's not to say that a helping hand is wrong, but you should be aware that ultimately it all comes from somebody who tried and succeeded.
Re:Turn about's fair play (Score:4, Informative)
I saw the BLS stats, but i don't think you're right. The median tenure of the workforce is increasing. The length of tenure is highly related to age, and the workforce is aging.
What you really need to see is if the tenure time is actually increasing across age bands and not just for the overall workforce. Here's a somewhat dated analysis (compare figure 1 and figure 2): http://www.frbsf.org/economic-... [frbsf.org]
You can see the overall tenure is increasing, but the tenure of each age subgroups are actually declining. It's just the change of the population in the subgroups has dominated the results. This is called Simpson's Paradox: http://en.wikipedia.org/wiki/S... [wikipedia.org]
So the truth is that for any given age, job tenure was higher in the past. As they say, "lies, damned lies, and statistics."