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by Aardwolf 1228 days ago
Any idea why 6-8% are such common numbers in most of the recent tech industry layoffs?
4 comments

It's suspiciously close to what I understand to be the normal steady-state turnover rates for the tech industry. Nobody quits their jobs in an economy like this, so the turnover must be achieved by other means (and this way lets the employer pick who turns over).
It's an amount you can do safely without your employees or shareholders thinking you are a sinking ship, as that's what everyone is doing.

However don't be fooled - it will be 7% repeatedly until things stabilize. People think it's just 7% once. It might be, but this will be repeated if needed.

you're not kidding. I just did an internet search for "7% layoff" and it's staggering how many results there are.
Same reason Wall St takes a 7% commission on IPOs.
https://www.insidescience.org/news/brain-seven-magic-number

For those unaware the number 7 seems to have a special place in the human brain as it's the number of distinct things most humans can hold in their brain at once before needing abstractions or other devices to keep track of the information.

It's also the point at which our brains seem to switch from "a few" to "many" and because it's prime it's the highest a few number that we don't mentally split into groups of other numbers.

7% actually really is 0.07 though (or around 1/14th), the multiplication by 100 is completely arbitrary
Layoffs typically go like 7%... then you get another 1-2% of people who jump from the sinking ship. Then you get another round of 5%.. and another 1-2% who jump from the sinking ship and end up at a nice round number like 15%. Looks better than laying off 15% at once (although Zoom is doing great?)
Goldilocks.