A lot of people lost their jobs recently, especially in tech. As of November 15, it’s reported over 120,000 and about 6,000 in the Seattle area with more coming. Here are three takeaways (and I’m sure you can think of others).
- In my humble opinion tech companies over-hired when the headlines were shouting how hard it was to find good people, and times were incredibly good for tech firms. Stockpiling people like some companies stocked up on inventory. When the economy looks rocky it’s time to thin the herd.
- Many years ago a bank branch manager lamented his bank’s latest round of cuts to please Wall Street. I can still remember him saying how the amount of work didn’t decrease, just the number of people to do the work, meaning those who kept their jobs had more to do. I’m assuming it’s the same now.
- Some of these people will say, “Screw the corporate job” and look to get into business for themselves, whether it be a startup, an acquisition, or a franchise. Because of this we’ll have winners and losers. Business owners thinking of selling will have more buyers to choose from. Business buyers will now face more buyer competition, and this will trickle up to the middle market as some of these executives will raise money to buy larger businesses (even if it means not owning 100%).
It’s always interesting.
“Nothing is so permanent as a temporary government program.” Milton Friedman