Tech layoffs in 2024 already: 32,500 and counting as AI takes precedence

One Thing Today in Tech

Layoffs at tech companies have continued into 2024, but first, a couple of other headlines that caught my attention.

Hyundai Motors is planning to list its Indian unit to raise at least $3 billion in what would be the country's biggest IPO, Reuters reported yesterday, citing two people it didn’t name.

Hyundai, the second-biggest automaker in India with a 15 percent market share, is in early talks with several banks for the fund raising, which would value the Korean automaker’s Indian operations at up to $30 billion, which is more than half its market capitalisation of $42 billion in Seoul, according to Reuters.

As Paytm reels under the Reserve Bank of India’s tough stance over the fintech company’s non-compliance issues, some founders of startups in India have written to Governor Shaktikanta Das and finance minister Nirmala Sitharaman, urging them to “review” and “reconsider” the regulatory directive asking Paytm’s payments bank unit to shut its main banking services after February 29, Economic Times reported earlier today.

Policybazaar's Yashish Dahiya, Bharat Matrimony’s Murugavel Janakiraman, Makemytrip’s Rajesh Magow and Ritesh Malik of Innov 8 are among the signatories to the letter. They’ve said the punitive measures against Paytm would have a far-reaching impact on India’s fintech ecosystem, according to ET.

One thing today

Tech companies have already shed about 32,500 jobs in 2024, according to layoffs.fyi, which tracks job cuts at 5,000 tech companies. Snap, which operates the photo and video sharing app, Snapchat, is the latest internet company to announce job cuts in 2024. The company said in an SEC filing on Feb. 5 it would reduce its headcount by 10 percent worldwide.

Snap expects it will incur charges ranging from $55 million to $75 million, according to its filing, from this latest round of cuts. The company previously laid off 20 percent of its staff and restructured its business lines in August 2022, CNBC notes.

Several other well-known tech companies have reduced their staff strength this year, including Paypal, Microsoft, Zuora, Zoom, and Okta. Indian food delivery unicorn Swiggy, ahead of its IPO plans, recently cut another 400 jobs, TechCrunch reported on Jan. 25.

And India’s top IT services companies entered the year with their collective workforce lower by tens of thousands of employees. Tata Consultancy Services, India’s biggest IT company, for example, reduced its workforce by close to 11,500 people in the nine months through December 2023.

Infosys, the second biggest, has reduced its workforce by more than 20,500 staff in the same period.

Tech and IT companies around the world recruited aggressively as the world came out of the Covid pandemic. Since then, the combination of the global economic slowdown and the rise of AI and AI-based automation, has changed the world. Now, even as things are beginning to look up in the world’s biggest tech market, the US, hiring will increasingly reflect investments in AI.