In 2022 the historically booming tech sector announced several hiring freezes and growth slowdowns, which in turn caused mass job cuts and waves of uncertainty.
The result? More than 135,000 employees at tech companies across 90 US cities are now out of work.
Which US cities were most affected by the layoffs?
Using data compiled from several authoritative sources (Layoffs.fyi, Layoffs Tracker, Crunchbase, and TechCrunch), we’ve produced a heat map to highlight how many people have lost their jobs and which cities have been hit hardest by the recent layoffs.
This interactive heat map below:
- is divided into the four US regions (labeled blue for the West, orange for the Midwest, pink for the South, and purple for the Northeast)
- helps you see the number of layoffs and affected cities when hovering over each area
- lets you scroll or click the plus-minus button so you can zoom in and out of various regions
As illustrated above, a staggering 686+ companies laid off employees in 2022. And in particular, 42.7% of layoffs were from the San Francisco Bay Area, one of the world’s most prominent tech hubs.
The statistics below show city locations that have faced job cuts:
- 57,776 employees lost their jobs in Northern California (primarily San Francisco and Silicon Valley)
- Seattle employees faced 14,481 job cuts from 31 companies
- 18,383 layoffs from 121 companies occurred in New York City
- 1 finance company alone laid off 1,700 employees in Milwaukee
Which US region faced the most layoffs in tech?
Every region in the US was affected by the job losses, but the Western United States felt the biggest blow.
Below is a bar chart depicting the number of layoffs that occurred this year:
Here are other data figures related to the job cuts per region:
- Over 84,800 people faced layoffs in the Western region of the US
- 27,716 tech employees were laid off in the Northeast
- 41 companies in the Midwest laid off 11,841 employees
- More than 10,788 tech workers were laid off in the South
Which month was the worst for US employees?
Notably, 36% of all job losses occurred in November 2022. Below is a line graph highlighting the number of US tech employees that faced job cuts in 2022:
The data reports also revealed these figures:
- 21,235 tech employees from 93 companies were let go in October
- In January, 3 companies laid off 510 people
- Over 13,300 employees from 126 companies lost their jobs in June
The tech giants have fallen: percentage of layoffs by industry
Several industries in the tech world dealt with substantial changes in 2022. Here’s a pie chart showing the percentage of tech layoffs in each industry:
The healthcare industry was the most severely affected out of all the industries, totaling 11.59% layoffs.
Below are other industry-specific statistics compiled from our data:
- The finance industry made up 9.71% of the job dismissals, coming in second place for the highest number of layoffs by industry
- The aerospace, agriculture, B2B, and social sectors were the least affected at 0.14% layoffs
- Even amidst COVID-19, the travel industry made up 0.58% of the job cuts
What’s driving the rise in layoffs?
Several theories exist about these large-scale tech layoffs. However, there isn’t just one simple answer.
As the US slowly recovers from the COVID-19 pandemic, certain organizations have admitted to hiring too soon.
Besides corporate restructuring, other factors behind the increasing amount of US layoffs include rising company interest rates and economic inflation.
2022 also saw Elon Musk purchasing Twitter, as well as a cryptocurrency market crash that shook up several cryptocurrency companies — and affected people’s wallets. The University of Michigan reported a decline in consumer attitudes due to “borrowing costs, declining asset values, and weakening labor market expectations.”
Similarly, a source from Morgan Stanley noted that although the labour market, wage growth, and personal spending numbers have held up in 2022, warning signs have also emerged. For instance, a rise in credit card debt and decreasing personal savings hint that an economic slowdown is creeping in.
What does 2023 hold for the future?
Are more job layoffs on the way? Most US CEOs think so.
According to a recent KPMG study, 91% of CEOs believe there’ll be a recession next year and plan to take precautionary measures.
Correspondingly, a survey from Spiceworks discovered that 50% of global IT organizations are preparing for an economic slowdown in 2023 and will tighten their budgets in response.
Also, with tech giants such as Amazon, Netflix, and Facebook already cutting off thousands of jobs in the past month, other organizations will likely follow suit as the world settles into 2023.
However, the number of layoffs in tech still doesn’t mean everything is hopeless next year.
Goldman Sachs reports that the US added 261,000 jobs in October 2022, so finding jobs in non-tech-related sectors or lesser-known tech companies is still possible.
Alternative opportunities for tech workers might look like:
- taking a break to upskill and re-evaluate their next career moves
- finding remote work more easily in the post-pandemic era
- joining a startup or smaller company as an experienced tech professional
Takeaways
During uncertain economic conditions, staying prepared and (cautiously) optimistic is key.
Gaining knowledge on the latest industry trends and equipping yourself with the right resources (like free resume templates, guides on cover letter writing, and articles outlining interview tips for 2023) will help you successfully navigate the new year and beyond.
