[MuffinFlavored]

I have a friend who is basically an extremely "toxic capitalist" (to put it simply).

He "called" that it wouldn't last that a lot of people were making "big" tech money + not really working 8 hours a day.

Maybe that's what this whole "big tech layoff" is. A reset to lower overheated wages. Make 500,000 unemployed programmers compete for paycuts.

[pwinnski]

Your friend has bought into the hype, as a lot of people have. There are very few people making "big tech money" who are not also putting in very long hours. They exist, but are often/usually in the (long) process of being "managed out."

There's no doubt in my mind that a lot of this is a power-play by profitable companies to push back against developers who've collectively gained more power at the negotiating table. Paying dividends and doing stock buybacks while saying "tough economic headwinds require us to lay off 6-8% of you" can only be a power move, as far as I'm concerned.

[DwnVoteHoneyPot]

Dividends/buy-backs and layoffs are derived from the same concept. The company has excess resources they do not plan to use in the future. If you have excess cash, return it to the shareholder. If you have excess employees, reduce head count. It means the company doesn't want to build anything at the moment (for various reasons include prep for a downturn).

[MuffinFlavored]

> The idea of comparing the expected return from a project to a risk-free rate, such as the return on a Treasury bond, is a common method used in finance to assess the riskiness of an investment. This is known as the cost of capital, which represents the minimum rate of return that an investment must generate to be considered economically viable.

How would you breakdown the distribution of projects inside of Apple from a return perspective?

Some will be 0% or negative due to R&D.

Some will be massively profitable (net 20-40% margins).

How do you decide what the right amount of loss-leading R&D projects to have is?

[chad_stevens]

You should read this article,

https://americanaffairsjournal.org/2021/08/the-value-of-noth...

[majikaja]

When companies trying to make cost cuts see an employee making $500k I don't think they go 'oh that's okay because they're working long hours'.

[vbordo]

Not quite sure why you're getting downvoted. Might be due to your friend's unsubstantiated claim tech workers (on average) are overpaid while underdelivering. However, the core observation is reasonable. Layoffs create desperation in the labor pool which is likely to drive median tech wages down. This benefits companies opex long-term as they restart the hiring cycle over the next couple quarters. Doubtful we're seeing market-wide collusion on these layoffs but it certainly creates an institutional hiring advantage.

[MuffinFlavored]

> Might be due to your friend's unsubstantiated claim tech workers

In his defense, he does own a small tech startup ($1m/yr I think?) and that has like 10 employees (3-4 engineers), so he has his finger on the pulse (or at least he thinks he does) when it comes to tech hiring.

That's a big problem, right? You think his claims are unsubstantiated, he thinks he knows it all and he's seen it with his own eyes. Who is telling the truth?

[bunbunbun]

Agreed but also it’s weird how a lot of lay-off %s are 7% +\-1 though?

[MuffinFlavored]

It's like one CEO did it and it opened the door for it to be socially acceptable climate wise for everybody to follow suit.

[bunbunbun]

So, a fad?

[MuffinFlavored]

I would say fad is probably a poor choice of words given the perspective "if one CEO thought it was appropriate (they let headcount + salaries creep up too high" and deemed it was in the realm of "action needed to correct", it probably wasn't baseless.

Have you taken a look at the year over year headcount growth of some of these companies? If anything, you could make the argument that 7% isn't enough :/

[bunbunbun]

I’m not really in the business of sympathizing with CEOs for poor past decisions