Tech layoffs as told by CEOs in 48 all-staff memos

This week, Amazon announced it was cutting 9,000 jobs. Last week, Meta started to deliver 10,000 pink slips. Both companies had announced previous rounds of mass layoffs, and they are not alone. All told, 500 tech companies have laid off a collective 148,000 workers in the past few months amid slowing growth and fears of a recession.

While the circumstances of each layoff decision may differ, there is one constant during these gloomy moments in Silicon Valley: the awkward all-staff memo.

We took a look at 48 such missives issued by companies ranging from massive Microsoft to small-scale start-ups, searching for insights into how tech leaders spin their stories and justify their decisions. Whether they use 200 words or 2,000, their memos bear remarkable similarities.

They point blame inward but also outward, for instance, alluding to the pressure of larger economic forces. They urge a positive outlook despite momentary clouds. And they rarely actually use the word “layoff.”

Here’s what they had to say:

A surprising number of these communications address workers using a corporate pet name, a practice that has roots in the ancient tradition of using one’s surname to indicate one’s profession, according to Ayelet Fishbach, a professor at the University of Chicago’s Booth School of Business. Like Potter or Mason in olden times, terms like Googlers and Vimeans are used today to connect people to their jobs.

But emphasizing communal bonds can be jarring in a layoff announcement, Fishbach said. Company leaders are “trying to remind people that they are family members — except that some people are no longer part of the family.”

22 out of 48 layoff memos used pet

names or refer to the company as family

22 out of 48 layoff memos used pet names

or refer to the company as family

22 out of 48 layoff memos used pet names or refer to the company as family

22 out of 48 layoff memos used pet names or refer to the company as family

In addition to using pet names, some memos urge surviving workers to offer emotional support to their dearly departed colleagues. Salesforce, for example, suggested offering “compassion and love” when the business software giant announced layoffs of 10 percent of its workforce earlier this year. Udemy, an online learning and teaching platform, told employees to hold “our departing Udemates … close to our hearts.” Salesforce declined to comment further. Udemy did not respond to requests for comment.

“There is a real sensitivity to try and strike the right note,” said Mara Vandlik, owner of mkv2 strategies, a communications consultancy. “As a culture there is a lot more insight into mental health — and a layoff is a traumatic experience.”

In half the memos we analyzed, tech leaders admit hiring too many people too quickly in response to explosive demand for e-commerce and digital services during the early, chaotic days of the pandemic. Amazon’s head count grew by 310,000 from 2020 to 2021, or nearly 25 percent, for example, while Meta grew by roughly the same percentage.

24 out of 48 layoff memos citied

overhiring or growing too fast

24 out of 48 layoff memos citied overhiring

or growing too fast

24 out of 48 layoff memos citied overhiring or growing too fast

24 out of 48 layoff memos citied overhiring or growing too fast

Over the past year, however, the tech industry has tumbled back to Earth. In many letters, tech leaders acknowledged overestimating the durability of the pandemic tech surge.

“We bet that the channel mix — the share of dollars that travel through e-commerce rather than physical retail — would permanently leap ahead by 5 or even 10 years. It’s now clear that bet didn’t pay off,” wrote Tobi Lütke, the chief executive of Shopify, an e-commerce platform for businesses, who laid off about 1,000 workers last summer. Shopify, which is based in Ontario, Canada, swiftly expanded during the pandemic, adding 2,000 workers in 2020 and another 3,000 in 2021. But the company said it had to recalibrate after the expected market transformation did not materialize. Shopify did not respond to requests for comment.

Katherine Ross, a career psychologist in the District, said such admissions can make tech CEOs seem more relatable. “Everyone had an experience of uncertainty and confusion during the pandemic,” she said, adding that owning a mistake can cause people to judge you less harshly.

“They want workers to know there is context here. Even though they are CEOs they can only control so much,” she said.

Nearly every letter we obtained made reference to tough economic times. “The economy is so vague. It’s an easy scapegoat,” said Laura Mazzullo, owner of East Side Staffing, an HR recruiting firm based in New York City.

46 out of 48 layoff memos mentioned

the economy

46 out of 48 layoff memos mentioned the economy

46 out of 48 layoff memos mentioned the economy

46 out of 48 layoff memos mentioned the economy

While the nation is not in recession — and has not been since April 2020 — 18 tech leaders nonetheless blame their layoffs at least in part on a “recession,” a “slowdown” or a “downturn.” Others refer to “macroeconomic headwinds” or economic “uncertainty.” Whatever term they choose, Mazzullo said, the point is to shift blame away from company decisions and onto some bigger challenge in the marketplace.

24 memos used the term macroeconomic

18 used the words recession, downturn

or slowdown

12 reference economic or

geopolitical uncertainty

10 mentioned inflation or interest rates

24 memos used the term macroeconomic

18 used the words recession, downturn or slowdown

12 reference economic or geopolitical uncertainty

10 mentioned inflation or interest rates

24 memos

used the term

macroeconomic

10 mentioned

inflation or

interest rates

12 reference economic

or geopolitical

uncertainty

18 used the words

recession,downturn

or slowdown

12 reference economic or

geopolitical uncertainty

24 memos used the

term macroeconomic

18 used the words recession,

downturn or slowdown

10 mentioned inflation

or interest rates

Nuro, an autonomous vehicle company based in Mountain View, Calif., told staff that 2022 brought an array of challenges, including “geopolitical uncertainty, energy crises, persistent inflation, and an impending US recession.” These conditions forced the company to cut back on spending and lay off about 20 percent of its staff. The market, Nuro’s founder said, “has gotten ugly.” Nuro referred The Post back to the memo and declined to comment further.

Nearly two-thirds of layoff memos mention a need for greater efficiency — a choice that can come off as victim blaming, said Sandra Sucher, a Harvard Business School professor who studies layoffs.

“What gets complicated here is conflating employee performance with company performance,” Sucher said. “If the company is actually doing restructuring, that actually makes that efficiency argument work.”

30 out of 48 layoff memos referenced

company efficiency

30 out of 48 layoff memos referenced

company efficiency

30 out of 48 layoff memos referenced company efficiency

30 out of 48 layoff memos referenced company efficiency

Patrick Collison, chief executive of the financial services company Stripe, wrote in his layoff announcement that the company needed to reduce costs to adapt to leaner times and remain a capital efficient business. He and his co-founder did admit early in the memo they were responsible for the decisions that led to the layoffs. With dual-headquarters in San Francisco and Dublin, Stripe said in November it would lay off about 1,100 people, slow hiring and rein in operating costs. Earlier this month, the company announced a new funding round of more than $6.5 billion. Stripe declined to comment.

In memo after memo, tech leaders project a sense of confidence and optimism about their company’s future. The goal, Fishbach said, is to reassure investors and the public, but also to tamp down fear among remaining workers. Otherwise, they might get “the sense that if you didn’t lose your job today, that you are next in line.”

“The opportunities ahead of us are immense,” Dell’s vice chairman and co-chief operating officer, Jeff Clarke, wrote in a February memo that is a model of the form. The company, based in Round Rock, Tex., said it decided to lay off more than 6,500 employees after finding that other steps to weather the market downtown and economic uncertainty — including a pause in hiring, limits on employee travel and reductions on spending for outside services — were not enough.

The layoff announcement nonetheless ends with a bright testimonial: “I’ve never been more confident in our future and our team.” Dell declined to comment further.

35 out of 48 layoff memos asserted

optimism or confidence in the

company’s future

35 out of 48 layoff memos asserted optimism or

confidence in the company’s future

35 out of 48 layoff memos asserted optimism or confidence in the company’s future

35 out of 48 layoff memos asserted optimism or confidence in the company’s future

At the end of her layoff memo, Yamini Rangan, chief executive of the sales and marketing software company HubSpot, wrote that “difficult times like this test us,” but “I know we can rebuild together.” HubSpot, which is based in Cambridge, Mass., said in January it would lay off about 500 workers after business slowed faster than expected. The company did not respond to requests for comment.

Sucher said layoff survivors do want to hear a credible plan for how their company will recover and prosper, and what role they will play in executing that plan. Layoffs are a violation of trust between a company and its employees, Sucher said, and a plan to right the ship “could be reassuring” to the remaining workforce — “if they believe in that.”

Business executives don’t always feel the need to apologize for layoffs, but more than half the memos do — a development that reflects changing norms in the business world, Mazzullo said.

“There’s less ego in the C-suite now. People are not interested in working for ego-led leaders who don’t take accountability and don’t say sorry,” she said, adding that workers are more willing to forgive someone who publicly expresses regret.

27 out of 48 layoff memos included

apologies or taking responsibility

for the layoffs

27 out of 48 layoff memos included apologies

or taking responsibility for the layoffs

27 out of 48 layoff memos included apologies or taking responsibility for the layoffs

27 out of 48 layoff memos included apologies or taking responsibility for the layoffs

Jennifer Tejada, chief executive of PagerDuty, did not apologize in her original announcement about layoffs affecting 7 percent of workers at the San Francisco-based cloud computing company. The January memo, which stretched to nearly 1,700 words, announced a promotion, praised the board and even offered a quote about leadership from the Rev. Martin Luther King Jr.

But Tejada later apologized for the use of the quote and the tone of the memo. “I should have been more upfront about the layoffs in the email, more thoughtful about my tone, and more concise. I am sorry,” she wrote in a subsequent note to staff three days later. PagerDuty declined to comment.

The most basic requirement for a layoff announcement is to show some humanity, show some humility and do no additional harm, Vandlik said. Failing to apologize can elicit criticism from anxious survivors as well as wounded victims — who these days are increasingly likely to air their grievances on social media.

“People are paying attention,” she said.