Experts analyze the crisis in the technology sector and predict more layoffs for this year
A Microsofttechnology giant and company that owns Xboxlays off approximately 2 thousand workers, around 8.6% of the team, from the gaming sector after the acquisition of Activision Blizzardwhich took place in October 2023 for a trifle of US$ 69 billion (R$ 342.93 billion in direct conversion at today’s exchange rate, 30).
In a memo issued with Microsoft’s endorsement, Xbox boss Phil Spencer says this was a painful decision. The letter also suggests that the Xbox and Zenimax teams, which run Bethesda and Arkane studios, will be affected. The gaming giant’s boss also said the company will provide full support to laid-off employees, including severance pay in accordance with local labor laws.
According to Spencer, the layoffs are part of a larger plan to identify areas of overlap following the acquisition of Activision Blizzard.
In a second letter from Microsoft, sent by Microsoft Studios head Matt Booty to the Blizzard team, he said that meetings are planned throughout the day to discuss the case and that workers outside of North America will be notified later. . Matt also reinforced his commitment to compensating those affected by the cut.
In this movement, Microsoft once again joins companies like GoogleMeta, Amazon and Twitch, responsible for the series of layoffs that have taken place in the technology sector since the second half of 2022. At the beginning of last year, the company created by Bill Gates announced the cut of 10 thousand employees.
According to data from the United States Department of Commerce, shared in December 2023, the large number of layoffs is not consistent with the general American economy, which appears stable, given high consumer spending and GDP growth.
According to some gaming experts, the layoffs are an effect of the great hiring boom that occurred during the pandemic, in which people, because they spent more time at home, spent more time consuming games.
Back in the realm of reality, many companies discovered that they were overextended, leading to these mass redundancies. This is hurting a lot of great companies and a lot of extremely talented people, says Harry Lang, Vice President of Marketing at game developer Kwalee, in an interview with The Drum.
In addition to this apparent crisis in the technology sector, the layoffs at Microsoft would be enough to pay for part of the purchase of Activision Blizzard, which cost US$69 billion, and the artificial intelligence developer OpenAI, for US$10 billion.
What does the future hold for us?
Even though Microsoft’s layoffs are more related to the company’s internal financial issues than to the external market, some experts believe that the wave of layoffs that is plaguing the technology sector will continue throughout this year.
All of the major layoffs we are seeing now could be cost optimization and market adjustments that can offer the same skills and competencies for less money, Iryna Chuhai, Marketing Director at WePlay Studios, told The Drum. She believes that, as unpleasant as this scenario is, it makes sense.
We just have to wait for the next few months to see if the technology sector’s economy gains strength again to, perhaps, hire possible future micro-enterprises that these workers can create as a result of the layoffs.
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