[onion2k]

The software engineers are likely going to be some of the highest paid employees, so laying off underperforming engineers is going to help reduce labor costs substantially.

It might seem counter-intuitive, but often businesses lay off the high-performing-but-best-paid people because that drives the biggest savings while reducing the vanity headcount metric less, especially in companies where the effort of the team greatly outweighs any individual. They assume (sometimes rightly, sometimes wrongly) that the team will carry on without the 'superstar' people. There's also an assumption that the best people will leave when there's a layoff (mostly rightly), so getting rid of them means maintaining control of who's gone.

There should never been an assumption that you're safe from layoffs because you're the highest performing person on the team. Sadly.

[ChuckNorris89]

High performing people adding the most value to the business were rarely the highest paid ones as they had long tenure and the best institutional knowledge but got mediocre wage increases as a punishment for being to loyal too the business.

The highest paid ones were usually the ones who job hopped the most during the times of economic boom. They added little value where they went as their tenure was too short for that, but the market was so hot and the dev demand so high that tenure length and adding value didn't matter back then.

If you knew how, where and when to jump ship during the past boom, you could be an incompetent buffoon and you could still end up making way more than the tenured workers actually adding value to the company.

Now the companies are attempting to correcting that "mistake".

[thegginthesky]

No joke at all. I personally know people that rode this last hiring bubble very stellar and got from analyst to manager in just 2 years, while raising their salary over 300% upwards because of strategic company hopping.

Some of them did get fire and are having trouble finding a job that paid as well as the last one.

It was a risk they were willing to take and I believe in some cases it paid off.

[hef19898]

It does, if the plan included an option to step back to a lower paying job. Of it didn't, say because the life style continued to match the new salary and / or because people thought that career plan is going to work for ever, well then that plan can backfire hard.

[JaDogg]

Also it does not matter that a person is loyal, loyal ones can be fired too.

[ChuckNorris89]

Anyone can be fired