The MarketWatch headline: It’s the end of ‘fantasyland’ for Big Tech and its workers
Published: July 22, 2022 at 10:46 a.m. ET
By Jon SwartzFollow
Subheadline Tech companies are starting to cut back and workers are shocked by the changes
After Big Tech grew in unprecedented and unchecked fashion for a decade, building ostentatious palaces to house growing workforces while plying them luxuriant freebies to keep them from defecting to rivals, is the wild ride over?
Tech’s largest companies, as well as their smaller competitors, are looking to cut back as they face a litany of headaches: Billions of dollars in unused commercial real estate; supply-chain and cost issues; evaporating funding; a 21% drop in global M&A activity in the first half of the year to $2.2 trillion, according to new data from Refinitiv; an all-but-shut window on IPOs; wage inflation; talent retention.
The chief executives of Meta Platforms Inc. META, -7.59% and Alphabet Inc.’s GOOGL, -5.63% GOOG, -5.81% Google have warned employees of tough times ahead — with Mark Zuckerberg telling employees on the last day of the second quarter that the company faced one of the “worst downturns that we’ve seen in recent history” —and Microsoft Corp. MSFT, -1.69% is slowing hiring in some groups and eliminating a few jobs. Even the world’s most valuable company, Apple Inc., AAPL, -0.81% reportedly plans to scale back hiring and spending, after profligate spender Amazon.com Inc. AMZN, -1.77% signaled cutbacks earlier this year. Other high-flying tech players in recent years, such as Netflix Inc. NFLX, -1.54%, Snap Inc. SNAP, -39.08% and Lyft Inc. LYFT, -4.45% are making similar or more drastic moves, and many startups are in much worse shape.