Tue. Feb 27th, 2024

Why these new layoffs in the techno industry?

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The start of 2024 weighs heavily on the morale of workers in the technology industry, with the numerous layoffs in progress.

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Speech synthesis, based on artificial intelligence, makes it possible to generate spoken text from a written text.

Google, Microsoft, Discord, Twitch, Riot Games, Unity… One announcement of layoffs follows another in the technology sector at the start of the year. But it remains unclear why big companies do what they do. What if artificial intelligence (AI) played a role?

It was the company Unity, the publisher of the video game engine of the same name, which got the ball rolling by announcing the elimination of 25% of its workforce on January 9. Live video platform Twitch followed suit, announcing the next day that it was letting go of 35% of its staff.

Then it all happened: Discord announced that it was reducing its workforce by 17%, Microsoft, its video games division by 8% and Google has, until now, fired several hundred people, specifying that other announcements were to be made. predict.

In Montreal, the Behavior Interactif studio (Dead by Daylight) had to thank nearly 3% of its staff, following in the footsteps of Ubisoft Canada, which had cut around 2% of its workforce in November 2023, especially in the Quebec metropolis.

The American studio Riot Games, the publisher of the ultra-popular video game League of Legends, for its part disconnected 11% of its workstations.

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The aggregator Layoffs.fyi estimated on January 26 that 25,000 people have lost their jobs at 89 technology companies since the start of the year. This same site puts the number of positions cut in 1,187 firms in the sector at 263,000 for the whole of 2023, an average of 22,000 positions per month.

In most of these layoff announcements, the leaders mention restructuring, organizational changes, an effort to refocus on priorities, a need to resize teams, or even to reset them.

This ambiguity in the speech is voluntary, believes Jonathan Roberge, full professor at the National Institute of Scientific Research (INRS).

What is interesting about these announcements is the total lack of transparency. […] We are in the dark: no one knows what is really happening and the companies do not want to say it.

A quote from Jonathan Roberge, full professor at INRS< /blockquote>

What is certain is that the year 2023 was marked by a boom in artificial intelligence, with the democratization of generative AI tools like ChatGPT, from OpenAI. This has led to a frantic race to develop this technology among web giants, among others.

As these companies are at the forefront of transformations in this area, they become the guinea pigs: They will be the first to automate their workforce, even before being able to automate that of the outside world, says Jonathan Roberge.

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Jonathan Roberge, full professor at the National Institute of Scientific Research (INRS).

If these announcements are restructurings towards AI research and development, it is not clear whether it is human resources that are being moved into this department, or whether it is the capacity to automate jobs there. The interior of the teams of these platforms is at the forefront, according to the full professor at INRS.

He cites as an example the video game industry, which has been reporting job losses for two years: Programmers, actors and creative agents know very well that they are perfectly replaceable by the technologies currently developing.

And everything indicates that at present, technology companies have an inability to predict AI, which makes them, in a way, victims of themselves, analyzes the researcher.

< p class="StyledBodyHtmlParagraph-sc-48221190-4 hnvfyV">If AI can have its role to play in this wave of layoffs, we must still not leave aside the post-pandemic context which is still rife in the world. ;economy.

Technology industries have seen a period of strong growth during the COVID-19 pandemic. Circumstances have encouraged a suddenly renewed and massively significant attraction to computing, due to the marked increase in teleworking, but also video games, as people sought entertainment during confinements.

Google had around 120,000 employees before the pandemic, then increased to 180,000 during the pandemic. From there, it is certain that there will be corrections.

A quote from Jonathan Roberge, full professor at INRS

January 2024 is experiencing a bit of a Groundhog Day for staff members of technology companies, who, at the end of 2022 and the beginning of 2023, were tens of thousands to be shown the wears in this context.

The giant Microsoft announced in mid-January the elimination of 10,000 jobs due to the economic situation. That same day, Amazon cut 18,000 jobs worldwide. Two months earlier, it was Meta, the parent company of Facebook, Instagram and WhatsApp, which announced it would let go of 11,000 people while Mark Zuckerberg, its CEO, described 2023 as the year of efficiency.

Jonathan Roberge underlines that the post-pandemic context is also accompanied by new performance pressure on the stock market: Often, to increase your stock market rating, we will make announcements of layoffs. It's an old trick that people like because it gives the impression that there will be reductions in operating costs, and that expenses will be taken more seriously.

According to the INRS professor, it will take months, even years, to understand what is happening in the technological industries.

When we understand [what is going on in the industry], it will probably already be too late.

A quote by Jonathan Roberge, full professor at INRS

The big losers will be a plethora of workers, moral and ethical principles, says M. Roberge.

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