Worried about Salesforce layoffs? Well, the answer is Yes & Maybe No.
Why is this breaking news, answer is very simple. Salesforce has been the industry leader in terms of hiring & career growth.
Well sadly yes, that’s what US San Francisco-based office reported. Moreover, it’s not concerning as of now as the reports suggest a different picture of India hiring plans.
It is also essential to know the company has been hiring spree to date, & salesforce technology has been one of the most booming across industries.
The pandemic was difficult for most companies across the industry & story at salesforce was no different. Software giant fired around 1000 folks as the report suggested & very soon it announced hiring for 12,000 employees in mid of 2020.
India followed the same patterns where it indicated hiring for salesforce increased by three times. But despite a 25% revenue increment annually for FY22, Salesforce is reportedly laying off people and has frozen hiring.
With a whopping strength of 70,000 workers, a mere 90 workers have been laid off. Mainly 90 contractors are laid off from a specific department which is recruitment. This also is alarming as experts & a report from SFGate say this is because they are planning to freeze hiring till Jan 2023.
What are the Advantages of Layoffs?
The company doesn’t have to continue paying for benefits. Employees can begin searching for their next job without false hope your organization will take them back.
What are the Disadvantages of Layoffs?
Hiring and training new employees is costly.
Company incurs unemployment costs.
Company loses institutional knowledge.
It can be harder to “bounce back” or return to full strength.
Recent layouts are because the company wants to increase the profit margins by 25% in the upcoming 3 to 4 years. They also mentioned in current reports that, hiring is slowing down so we decided to cut the cost by laying off 90 contractors in the recruitment department. Last month Salesforce also announced hiring 2500 employees in India which already have around 10,000 employees across the country. Salesforce has office premises in six major cities in India including Mumbai, Bangalore, and Jaipur. So far this news doesn’t seem to hurt the Indian market however will still have to wait and watch the upcoming next couple of quarters how things unfold.
Salesforce has some huge clients including names like Coca-Cola, Canon, and many more Fortune 500 organizations. Global organizations as well as economists have been warning the world about upcoming recessions and speculations don’t deny this cause for layoff. What’s more worrisome is freezing hiring for the next 3 to 6 months. But as we concluded in the last paragraph this is the testing time and we will have to wait and watch for like 3 to 6 months to come to a point of whether or not it’s a recession.
As everything has two sides this decision or scenario also has positivity and negativity. The negativity we already discussed, industry leaders seize positivity as a steep fall in attrition which is reaching 30%+ in some organizations
Layoffs in the US IT sector continue. Microsoft and Alphabet were among the corporations that announced massive layoffs this week.
According to Crunchbase News, more than 46,000 people at US-based internet businesses have been laid off in mass layoffs thus far in 2023, and the year is still young. This figure includes Microsoft’s 10,000-person layoffs and Alphabet’s 12,000-person layoffs announced this week.
More than 107,000 positions were cut from public and private tech firms last year as they faced growing inflation and a volatile stock market. The economy has had to deal with a culture of excessive hiring and skyrocketing valuations, and companies are now forced to navigate a cold market as venture capital becomes scarce.
Qualtrics, Carta, and Verily, among others, have cut employment this year, blaming overhiring during periods of strong expansion. To keep track, we’ve collected a list of IT businesses located in the United States that have laid off staff so far this year.
The job-cutting trend shows no signs of abating. In 2023, an estimated 6 out of 10 businesses will lay off 30 percent or more of their staff. So, who is most vulnerable to future layoffs?
The Workforce Confidence Index from LinkedIn captures workers’ anxiety levels as well as the specific positions they hold. Approximately 31% of the 5,000 poll participants in the United States are concerned about their employer’s intentions to implement layoffs and budget cuts, particularly in jobs directly related with new product rollouts. These are some examples:
These data are consistent with Revelio Labs’ results, which demonstrate that many job layoffs occurred in talent recruiting, sourcing, and marketing jobs, notably in Big Tech businesses.
“The bulk of laid-off individuals either have highly compensated responsibilities or are entry-level hires,” said John Willis, senior software engineer and creator of Convert Free. “At the start of the epidemic, waves of layoffs devastated workers in retail, amusement, and tourism. As the epidemic declines, fewer of those workers become available, and higher-paid workers are suddenly the ones receiving layoff letters. The IT industry is leading the way in terms of cost cuts.”
Although layoffs are getting a lot of attention and raising anxiety levels for many, LinkedIn’s Workforce Confidence Index report shows they don’t represent the overall job market. In other words, not all workers are feeling the layoff jitters equally.
Professionals with the least stress about getting laid off are those categorized as problem-solvers in fields, such as:
Despite the reduction, the broader economy is still adding employment, with around 10.5 million job opportunities and 6.1 million hires in the labor market. While the general employment market remains strong, businesses are nonetheless actively bracing for a downturn.
According to JP Morgan Chase’s 2023 Company Executives Outlook study, 65 percent of midsize business leaders in the United States anticipate a recession in 2023. An whopping 91 percent of leaders are concerned about rising expenses as inflation strikes, with 51 percent expecting it to worsen now that the midterm elections are done. In 2023, just 8% feel positive about the global economy, compared to 34% in 2022.
According to the NFIB’s Small Business Optimism Index, inflation is the single most critical challenge for small business owners. Other issues include sharp interest rate increases and growing material costs (supplies, inventory, energy and labor).
Despite their pessimistic outlooks on the economy, most company owners intend to maintain or even increase employees in 2023. Despite the grim economic picture, over 65 percent of executives are positive about their own firms’ success, and 88 percent anticipate to add or retain staff. According to JP Morgan Chase’s poll, around 86 percent of respondents are optimistic about their revenues, while 76 percent anticipate to raise or maintain capital expenditures.
Employers have always used budget and employment cutbacks to save money during recessions. However, layoffs have negative long-term consequences, such as damaging a company’s brand, creating knowledge gaps, decreasing employee engagement and customer retention, and eroding trust among workers and consumers.
“Our team of employees is the lifeblood of our firm, and we’d rather run a loss than lay anyone off,” Carlson Lang, cofounder and COO of Test Prep Insight, stated. “Other small firms might not have that luxury, but to the degree you can weather the storm and keep people working, I believe you’ll be better off for it in the long term. This recession might last less than a year, and you don’t want to be competing for talent when everyone else is when this is over.”
Small company owners, like Lang and the 90 percent of midsize business executives who anticipate to add new employees or maintain their present teams, might potentially prevent layoffs by:
Other layoff alternatives include offering temporary furloughs, converting employees into contract or temporary workers, shortening work days and implementing flexible working schedules.
According to ZipRecruiter chief economist Julia Pollak, the new stories are all converging at the same time as firms rectify their over-hiring and see how increasing interest rates are impeding their development ambitions.
She thinks layoffs, even in the thousands, are “not surprising” given how the Fed’s interest rate hikes have made it more difficult for corporations to borrow, causing stock values to fall, and making US products too expensive for overseas markets.
Pollak adds that the recent economic turbulence is disproportionately affecting technology and may have an influence on other downstream industries.
Salesforce layoffs are also expected to begin soon, affecting a large number of staff. Following the announcements by Amazon, Goldman Sachs, and others of new waves of major layoffs, Salesforce Inc. has stepped up and chosen to slash some workers.
According to Reuters, Salesforce co-CEO Marc Benioff addressed a letter to all workers describing how the current situation remains hard on multiple fronts.
Salesforce, the cloud-based software business, is also apparently laying off employees in several offices. According to the many reportes, the corporation is reportedly considering closing a few offices in order to reduce expenses even more.
Jaipur-based IT staffing company Conscious Foundation says that it is not going to affect the local hiring market. Although we will see attrition coming down which indeed is good news for technology & salesforce companies like Appcino, Metacube, Cyntexa, etc.
We will be glad to have your take on this, please comment below.