Why widespread tech layoffs keep happening despite a strong U.S. economy

The tech sector in 2024 #

The tech sector in 2024 is experiencing positive growth. Nvidia has exceeded earnings expectations, while the artificial intelligence boom continues to thrive. The Nasdaq index, which consists of tech-heavy companies, has seen an increase of over 8% year to date.

Despite this, tech workers are facing layoffs. The future of work and technology, as well as changes in investors’ preferences for risk and growth versus profitability, are contributing to this shift. In 2024, there have been more tech sector layoffs compared to 2023.

Several factors are driving these layoffs. Companies are reallocating funds to invest in the necessary infrastructure for AI technologies. Additionally, companies that have conducted layoffs have not faced negative consequences and, in fact, have experienced rising stock prices.

Unfortunately, the strength of the U.S. economy may not be enough to rescue tech workers from further layoffs in the future.