Yahoo announces layoffs for 20% of its workforce
Just when you think you can go three days in 2023 without a well-known tech company announcing swingeing layoffs to its workforce as part of a plan to navigate the “uncertain economic climate” of the post-pandemic crunch, you remember that Yahoo still exists.
Yahoo has announced it will lose a full 20% of its 8,600 workforce, outstripping the average 6-8% layoffs of many of the bigger players.
Not a Covid readjustment.
While Yahoo has been around since 1994 (making it one of the oldest surviving tech firms of which people have heard), it’s had a challenging time in the last few years, being bought by Verizon in 2017, and then sold to Apollo Global Management in 2021.
Whereas most of the big names in tech are being forced into their layoffs as a result of investment in extra staff to cope with expanded demand during the Covid-19 pandemic and its necessary lockdowns, and those extra staff being unsupportable given an uncertain economic forecast for this year, Yahoo has come up with a different take on its significant layoffs – the first thousand of which are due to take effect within seven days of the announcement.
Rather than cutting jobs across the board (and certainly not on the board), the brunt of the Yahoo layoffs will be felt by the advertising department in its Yahoo For Business arm, which has been particularly struggling in recent years. That department is set to cut more than 50% of its staff across the rest of 2023.
Also, rather than releasing what is becoming an increasingly anodyne repeated meme of regret and sail-trimming, Yahoo is pushing a positive spin on its layoffs. It says the changes will help the company simplify and strengthen its advertising business in the long term, “while enabling Yahoo to deliver better value to our customers and partners.”
The layoffs are also expected to see Yahoo restructure its advertising focus, to put its “demand-side platform” advertising arm – which has been considerably more successful than that of Yahoo For Business – front and center. That means, for instance, that the occasionally slightly creaky business will be bowing out of the contest for a slice of the digital advertising pie, in which it has had to compete with the likes of Google and Meta.
Like the recently-announced layoffs at Dell Technologies, Yahoo’s layoffs can be thought of as coincidental with the economic bloodbath currently consuming the tech industry, inasmuch as they’re actually not being caused by the same “invest in pandemic, layoff in economic turbulence” strategy of some of the biggest players in the industry.
Smile! You’re out of a job.
But whereas Dell’s layoffs had a distinctly negative connotation (the company actually laid staff off during the pandemic, so the latest layoffs are something of a genuine survival strategy, rather than a simple adjustment which costs thousands of families an income), Yahoo is doubling down on the positive effects of losing 1600 advertising executives and creatives, which it says will see it much more able to compete, not only in the gigantic economic uncertainty of 2023, but also in the future market.
Yahoo’s new overall advertising division will be called – with a clarity of thought which reveals it has been nowhere near an advertising department – Yahoo Advertising. To explain what that will mean for Yahoo’s clients, a company spokesperson said:
“In redoubling our efforts on the DSP on an omni-channel basis, we will prioritize support for our top global customers and re-launch dedicated ad sales teams towards Yahoo’s owned and operated properties – including Yahoo Finance, Yahoo News, Yahoo Sports and more.”
The Top Ten.
Of the top ten leading tech companies in the world, most have now laid off a significant portion of their staff in the last few months of 2022 and the first two months of 2023.
- Amazon has announced 18,000 jobs will go.
- Alphabet (owner of Google) will lose 12,000 staff.
- Microsoft has said it will cut 10,000 people loose.
- Tencent will lose around 5,000 staff worldwide.
- Meta has announced it will cull around 10,000 jobs from its infrastructure – but just days ago, was said to be contemplating additional cuts.
- Cisco Systems has axed around 4,800 roles, though like Dell and Yahoo, those losses seem to be part of a broader restructuring effort.
- Oracle is losing thousands of people across 2022/2023.
- And Broadcom has announced almost 2,000 layoffs in the wake of its acquisition by Avago Technologies.
Bucking the trend in the top ten so far, Samsung Technologies – which despite having had what might in most cases be described as a disastrous fourth quarter of 2022, announced it would take on 1,000 new engineers in India to work on its newer technologies, including its AI and machine learning modules.
And then there’s Apple, which with the stubbornness of foresight that makes it both beloved and despised around the world, refused to overhire during the pandemic, and so now has no particular need to tighten its belt – although a combination of late production of its latest iPhones thanks to conditions in its biggest Chinese manufacturing plant, and its domestic labor concerns with unions demanding negotiations and the National Labor Relations Board finding it infringed on its workers’ rights on the way to the founding of its first US unions.
So while it hasn’t been forced into any significant layoffs as yet, Apple’s staffing future may not be as bright as the headline of its pandemic calm may suggest.
Is the wave of layoffs done with the tech industry as we head into the middle of February? It’s too early to tell, but the strong likelihood is that there are more to come, whether, like Dell and Yahoo, as part of fundamental restructuring, or like the majority of the industry, as part of a post-pandemic rebalancing.
Watch this space.
27 March 2023
27 March 2023
27 March 2023