Every company wants to cut spending on people, services, and facilities, because revenues are slowing down, costs are rising, and there's more uncertainty about the near term future.
The people who lose their jobs, in turn, are forced to cut their spending, contributing even more to the ongoing revenue slowdown at companies that sell to consumers.
The service providers who see their billing examined with a microscope and who are told that new projects are now on hold, in turn, find themselves forced to cut their own spending on people, services, and facilities, contributing even more to the ongoing revenue slowdown at other companies.
The office buildings who are given notice of lease terminations, in turn, find themselves forced to cut their own spending, contributing as well to the ongoing revenue slowdown at other companies.
The more every company and consumer cuts spending, the less money all companies and consumers earn. This unpleasant state of affairs is called a "recession." When it's really bad, it's called a "depression." It's no fun. Many unprofitable companies and many consumers without savings are at risk of financial ruin.
> many consumers without savings are at risk of financial ruin
Yes. This is the reason for having a better social safety net. There's no reason a normal business cycle should "ruin" normal people that did not take excessive risks.
In theory sure, but in practice a great deal of this is driven by earlier over investments by tech companies who saw a huge surge in profits during COVID lockdowns.
It wasn’t just online companies that benefited by changing consumer habits as people where stuck at home with little to do browsed social media and ordered food delivery etc. Setting up remote options across many industries had many similarities with the pre Y2K investments and a wave of modernization efforts. That followed by supply shortages which pushed massive investments to build more robust supply chains etc.
a lot of skilled workers enter the job market at a reduced price, they have the know how to compete in the same or adjacent sector, medium company can acquire the competences at a reduced price, their profit increase their spending, etc etc
economics is not a single company
this is the tail of feds interest rate raise cutting down investment. it will last a while, but the economy doesn't yet seem unhealthy (well except some specific bubbles, but those have been there a while and if they pop will pop because they were bubbles, not because the secondary trigger)
As many of these companies base their projections on a relatively small number of outside sources, it often strikes me as a bit of a self-fulfilling prophecy.
Big business and financial firms have been signaling a belief in a downturn for a while now -- including while posting about record profits.
Indeed! Such a strong case for more social systems like employment insurance.
Not to oversimplify but I find “government programs” to be a good answer to basically any “tragedy of the commons” problem such as spending less during a recession.
Salesforce employee here. These were mostly the account executives who couldn't meet their quota. It's unfortunate that this is happening to AEs, who are usually the hardworking people at Salesforce struggling to close deals in a tough economy. It will be interesting to see what will happen to the random 'strategy', product and engineering folks who build over engineered, over priced, marketing bullock that doesn't sell.
This is pretty small adjustment for a company their size and comes on the heels of several large acquisitions and a huge hiring spree. I'm not sure this is actually a headcount reduction or just a restructuring. They have over 3000 job openings listed on LinkedIn right now.
cs702|3 years ago
The people who lose their jobs, in turn, are forced to cut their spending, contributing even more to the ongoing revenue slowdown at companies that sell to consumers.
The service providers who see their billing examined with a microscope and who are told that new projects are now on hold, in turn, find themselves forced to cut their own spending on people, services, and facilities, contributing even more to the ongoing revenue slowdown at other companies.
The office buildings who are given notice of lease terminations, in turn, find themselves forced to cut their own spending, contributing as well to the ongoing revenue slowdown at other companies.
The more every company and consumer cuts spending, the less money all companies and consumers earn. This unpleasant state of affairs is called a "recession." When it's really bad, it's called a "depression." It's no fun. Many unprofitable companies and many consumers without savings are at risk of financial ruin.
cheriot|3 years ago
Yes. This is the reason for having a better social safety net. There's no reason a normal business cycle should "ruin" normal people that did not take excessive risks.
tjixxu|3 years ago
Retric|3 years ago
It wasn’t just online companies that benefited by changing consumer habits as people where stuck at home with little to do browsed social media and ordered food delivery etc. Setting up remote options across many industries had many similarities with the pre Y2K investments and a wave of modernization efforts. That followed by supply shortages which pushed massive investments to build more robust supply chains etc.
avereveard|3 years ago
economics is not a single company
this is the tail of feds interest rate raise cutting down investment. it will last a while, but the economy doesn't yet seem unhealthy (well except some specific bubbles, but those have been there a while and if they pop will pop because they were bubbles, not because the secondary trigger)
manachar|3 years ago
Big business and financial firms have been signaling a belief in a downturn for a while now -- including while posting about record profits.
Waterluvian|3 years ago
Not to oversimplify but I find “government programs” to be a good answer to basically any “tragedy of the commons” problem such as spending less during a recession.
throwawaynov|3 years ago
DaiPlusPlus|3 years ago
> account executives
...you mean "sales", right?
tootie|3 years ago
JDEW|3 years ago
> At the end of January it employed 73,541 people.
“…employees Monday”,
“…January”
Is this grammatical? Is it coherent? Or was this generated with GPT-3?
pwinnski|3 years ago
Yesterday, Salesforce reduced their headcount.
It doesn't seem difficult to parse at all.
happytoexplain|3 years ago
radiojasper|3 years ago