The real problem that author doesn’t call out is that at the end of the day, the people in charge don’t get hurt from these irresponsible boom and bust hiring practices. These companies knew the growth wouldn’t last, nothing lasts forever.
They all maintain control while the little people suffer. The dream is to become insulated from the economic storms like they are.
Yeah; the thing that kind of triggered me on this was the Google CEO saying in December or January that he "takes full responsibility" for all these layoffs.
"Full responsibiliyt"? Really? How are you doing that exactly? By still getting your full paycheck and bonus while you fired twelve thousand humans because you didn't consider that the economy after years of a pandemic might be volatile?
By saying that he is directing internal heat ( and external heat - like yours ) to himself, rather than HR, or middle managers etc in Google.
I suspect that's the reason for saying that. If you feel the need to blame somebody - blame me ( not other people or external conditions or shareholders ).
Ultimately it is his fault - even if it was forced on him be shareholders - he'd have the option of resigning ( following orders isn't a good excuse ).
In terms of the effect on him - you are assuming he isn't somehow human, and somehow these decisions aren't personally very hard to take.
In the end it comes down to whether you have a company culture of firing people the first mistake they make or not. Most people would suggests that's a bad company culture.
Whether they should have chased unsustainable growth is an interesting matter. I think the culture damage that large layoffs can have, particularly to companies that previous have always been growing, is substantial and underestimated.
ie the people left are often demotivated.
I once worked at a startup that let ~20 people go ( just under 10% ). The company was reasonably successful in keeping the best people in the short term, but motivation was right down and many of them drifted away over the next year or so.
>directing internal heat ( and external heat - like yours ) to himself, rather than HR, or middle managers etc in Google.
The reason this is irrelevant is because it's not what Western society values. If he is sincere about taking responsibility, he would either resign with no compensation, or take a severe paycut for failure. If a CEO is handed a bonus when the company does well, then it must follow that their head rolls when it doesn't.
"Taking heat" should be part of the day-to-day of a CEO's job and not the "punishment" for failure.
I don't dispute most of what you said, but I take a bit of issue with:
> In terms of the effect on him - you are assuming he isn't somehow human, and somehow these decisions aren't personally very hard to take.
Humans are perfectly capable of doing horrible things and justifying it to themselves; me claiming that his words of "taking full responsibility" is a corporate platitude doesn't imply that I don't think he's human. I'm sure at some level he probably feels emotions the same way I do, but I also think he's somewhat removed from the consequences of his decisions.
We all do it to some extent (don't think too hard about the labor behind your phone or computer). Doesn't mean it's not crappy.
This does not change the fact that the "heat" he is taking had exactly zero consequences for him. So "I take full responsibility" is an empty platitude that means basically nothing.
That seems like something the board/shareholders/market would reward him for, not punish him for. Who would punish him and why for the inhumanity of firing lots of people? Not the board, not the California state government, not the Federal government. Maybe that would be a role for an employee's union?
Shouldn't he only be rewarded if something he did actually led to growth? Lots of companies grew like crazy in 2021, as mentioned in the parent article.
Moreover, if we're going to reward this individual when times are good purely for being in charge at the right time, then shouldn't it go both ways? Shouldn't we punish him when things are going bad, for example the tail end of 2022?
I'm not a business person, it just seems like if I were an investor with Google [1] then that's how I'd view it.
[1] I don't own any Google stock directly, but I suppose indirectly I own some via ETFs and an index fund.
ETA:
The reason I mention this is that I don't want to "punish him for firing lots of people", but because the people that were fired were the only ones punished for his bad leadership.
Sure, what you say is not wrong, the financial incentives are all wrong and reward being an inhuman.
That being said, none of what you said justifies his empty "I take full responsibility" statement. It's hollow and it achieves nothing. Well, nothing good related to those fired that is.
What were the financial incentives of people taking a job at Google? They wanted to get paid top of market compensation for their labor and they did while they were working there.
What did the employees do with their additional compensation? Did they save it? Are they trying to use the fact they worked for Google to increase their network?
At what point is it the employee’s responsibility to assume that no job is permanent?
What you're saying isn't contradictory to criticizing the CEO.
Yes, a job is a business transaction and employees should be aware of that. I don't think anyone here disputes it. I certainly do not. That has literally no bearing on the fact at all on whether or not the CEO claiming that he's taking "full responsibility" is an empty platitude.
No one is accusing Google of slave labor here, but that's the claim you're defending.
ETA:
Whether or not the employees should be viewing working for Google as transactional, it's still a frustrating pain in the ass to be fired from a job. They have to spend some amount of time with no income. They have to go through an annoying interview process of people masturbating to whiteboard problems. Their next job might not pay as well. If they weren't at Google very long (<1 year) then that's still going to look bad on a resume.
It's a frustrating experience. No one is claiming that the CEO of Google should go to jail or anything, but if he's firing 12,000 people because of his bad decisions, him claiming that taking "full responsibility" is just an empty statement and it's frustrating.
And every CEO makes empty statements. Do you also believe the “we are family” bullshit? The DI&E initiatives? Did you believe the “Do no evil” motto they use to have?
Why would I believe anything my CEO says in that regard who I am 7 levels removed from and I’m one of only 1 million+ employees at the 2nd largest employer in the US? I know I’m just a number.
> Their next job might not pay as well
As hinted above, I also work for BigTech, so I’m in no way bitter about their income. But how large of a fiddle should I be playing for someone who might not make $300K - $400K and might have to sully themselves and be a corporate dev making “only” $150-$170K like most of the 2.7 million devs in the US (as I did most of my long career)
I'm sorry, but how does me pointing out that a CEO's statement is a hollow meaningless platitude imply that I believed any corporate bullshit? Doesn't that suggest the opposite, that I don't believe it and I am pointing out that it's a frustrating meaningless gesture?
And because I don't believe it, and because I think it's an outright lie, it's more frustrating.
Are you suggesting that just because a lie is common, it's no ok to point out that it's a lie? I guess I respectfully disagree.
Also, it's not like I asked you to cry over the people fired from Google, I was just explaining that it's an annoying pain in the ass to be fired from a job, even if they do find something relatively quickly. A negative pay delta, from experience, objectively sucks, even if the pay you ended up with is livable.
I find this mentality of "I used to have it worse so therefore I lack all empathy and that makes me a badass" to be an extremely frustrating perspective that people on HN and Reddit have. I don't really see why you felt the need to personalize this.
I’m not complaining about “having it worse”. I had two 3000 square foot houses built in the burbs, off of my corp dev compensation over the years, went on plenty of vacations and had a good middle class life.
I’m saying I don’t spend energy being “frustrated” about what a CEO says who doesn’t know me from Adam. My energy is better spent reading between the bullshit and preparing myself.
Do you also get frustrated by politicians lies?
Again, cry me a river for people who can’t live off of 3x+ the median wage in the US instead of 7x+ Yes I’m in the latter group.
I’ve changed jobs 8 times in my career not counting two or three contract jobs. I have it down to science now. It would be harder for me in this hiring environment admittedly.
I made damn sure I didn’t suffer from lifestyle inflation when my compensation went from working at a 60 person startup in corp dev to BigTech. For me it’s more like “it was fun while it lasted” and I used the money to increase my financial stability.
Of course I do. I don't enjoy being lied to, even if I know they're lying to me. I also do think that lies should be called out when exposed, even if they were obvious.
I never claimed that they "couldn't afford" to live off "3x+ the median wage", and this is now the second time that you've claimed I have. I said it's frustrating to have a negative pay delta, no matter how much the before and after is. This really should not be controversial or difficult to understand, which makes me think you do understand it and are conveniently playing ignorant.
Correct me if I'm wrong, but looking at any of the messages in this thread, I don't think anyone is "worried" about the ex-Googlers, despite your insistence to the contrary. Of course they will probably be fine, engineering is a pretty cushy gig. No one asked you to pity them, I just mentioned that a negative pay delta sucks and you've repeatedly gone off on some moral high-horse about how you're good about saving money.
That's fucking great, but please don't take this the wrong way, I really do not care about your spending habits, so I do not know why you keep bringing them up, other to do the "badass lack of empathy" thing I mentioned before.
ETA:
Also, is someone impersonating you? I see scarface_74 and scarface74; is this some way of laundering dislikes so they don't pollute your main account?
> That's fucking great, but please don't take this the wrong way, I really do not care about your spending habits, so I do not know why you keep bringing them up, other to do the "badass lack of empathy" thing I mentioned before
Yet you care about a CEO and calling them out on a random internet site that they will never see?
My advice is a lot more actionable than worrying about a CEO or politician’s lies - save money, live below your means, don’t be a victim of lifestyle inflation and always be prepared to get another job.
Both accounts are mine and neither are getting negative votes. I just noticed that I’m logged into one from my phone and the other from my computer. At one point I made a mistake of setting the “noprocast” to a month and locked myself out. I created the other account with a similar name specifically because I didn’t want to be accused of astroturfing - ie having two separate accounts to seem like I’m agreeing with myself
> Yet you care about a CEO and calling them out on a random internet site that they will never see?
Google's CEO's decisions are far more consequential to me than your spending habits, so yes I think it's more prudent to call it out than worrying about how you save money.
Based on the numbers you provided a few posts up, I've had more jobs than you (14 in the last 11 eyars, and currently unemployed), so I'm well aware of how fragile a job can be, and I do save money pretty aggressively as a result of that.
And yet, having been fired and laid off multiple times, you know what? It still always sucks, and I can have sympathy for any human going through that, even if I know most of them will land on their feet.
They may be “consequential” to you but you can’t do anything about either and he neither knows you or cares about your thoughts on HN.
In tech, if you are properly prepared (in general ignoring the current tech hiring market), a layoff should be no more than a minor inconvenience if you live in a good market or especially now with more jobs going remote.
And a “good market” doesn’t mean the Bay Area. It means almost any large metropolitan area if you are willing to sully yourself and be a corp dev and don’t care about bragging to your friends that “you work for a FAANG”.
I don't live in the Bay Area, I live in NYC, and until somewhat recently worked for Walmart. I did used to work for Apple but that was years ago, and that was the only exposure I've had to FAANG.
You are kind of talking past me and @tombert btw. And you seem to have come here to claim some badassery on your part, and that we shouldn't expend energy on "being frustrated".
> At what point is it the employee’s responsibility to assume that no job is permanent?
Nobody claimed jobs are permanent and that everyone must be protected. Don't fight straw men, tearing them down isn't impressive in any discussion.
If you really wanna dance like that: I am a contractor by choice and changed no less than 10 jobs in the last 7 years and I take 2x less than you, and that's in a good year. I know better than many SV privileged people how rough can it be and I could even claim more "badassery" than you if we start digging deep on the experiences that we both have (for example, I got no real estate of my own even at 43 year old; asking "why" is a completely separate topic; another example is learning to self-onboard in an afternoon).
But that wasn't the topic and I'll ask you not to shift goal posts.
Reading deep into your replies it seems you basically got in here to say "don't complain you spoiled youngsters, work hard like I did instead". I mean OK, cool for you if that makes you feel validated -- we all need that, it's a very fundamental human need so I'm not judging -- but I still don't see how that is related to the topic at hand.
...which is: some of us take issue with empty platitudes said by CEOs and call them out. Yes I know Sundar Pichai doesn't read HN. Hope you didn't intend that as a mind-blowing revelation. This is a public forum, people choose to vent frustrations sometimes.
> I’m saying I don’t spend energy being “frustrated” about what a CEO says who doesn’t know me from Adam.
Cool, you have an opinion what should I expend my energy on. And I disagree with your opinion. Absolutely nothing you can do about what I expend my energy on. Moving on.
> My energy is better spent reading between the bullshit and preparing myself.
A lot of us do that plus "get frustrated about what a CEO says". These two things are not mutually exclusive.
> In tech, if you are properly prepared (in general ignoring the current tech hiring market), a layoff should be no more than a minor inconvenience if you live in a good market or especially now with more jobs going remote.
Yet again, nobody claimed otherwise. And what you say is true and applies to many tech workers, yes.
You seem to have misunderstood the intent between the comments replying to you though. You seem to think some privileged spoiled youngsters "cry you a river". No. We're adults with a lot of battle scars who are jaded by the fact that CEOs are 100% immune to any consequences from firing people.
OPINON: They should be liable, criminally liable even. The "taking full responsibility" part should come at the price of your mansion being taken away from you, sold on auction and the money divided between the fired people, and you the CEO having to live in a cramped apartment for a year (enforceable by the bracelet on your ankle). There should be REAL and INCONVENIENT consequences.
You could disagree. That's fine. What's not fine is completely misrepresenting what was said and insisting that people are spoiled and/or "expending energy" on stuff you feel should not be discussed.
Well cool, feel like you do. I am free to keep doing what I want to do while completely ignoring your opinion.
Hope this clears it up a bit for you, though reading your deep replies makes me think you came here with an agenda and stick to it no matter what is said to you. Which, if true, makes my comment a complete waste of time but hey, it's my time to waste and I enjoy wasting it sometimes.
> Reading deep into your replies it seems you basically got in here to say "don't complain you spoiled youngsters, work hard like I did instead".
I think no such thing. I was excited when an intern I mentored got a return offer at 22 making as much as I made when I was 44 before getting into BigTech.
I didn’t exactly struggle making what I was making over the years. During that time I had two big houses built in the burbs and I had a comfortable life. My lifestyle didn’t change any after going from corp dev -> BigTech. The extra money just went toward increasing my financial stability.
When new computer grads ask me for advice, I tell them to “grind leetcode and work for a FAANG” (tm r/cscareerquestions) - even though I never did that to get my $BigTech job - and make all the money they can.
I tell them how to play the promotion game and focus on politics, work toward “scope” and “impact” to get ahead - again even though that’s not a game I’m playing.
> No. We're adults with a lot of battle scars who are jaded by the fact that CEOs are 100% immune to any consequences from firing people.
I’m also jaded. But to the point where any job is merely transactional and I don’t take it personally when the transaction of “trading labor for money” is not seen as mutually beneficial to both parties.
> They should be liable, criminally liable even
Who was “inconvenienced” by making $250K+ for a few years and getting laid off with a severance?
You are a contractor, I consider every job a short term contract that could disappear. I wasn’t inconvenienced at all by making a lot more money at BigTech than I did at the 60 person startup I left even if I had gotten laid off.
If you are contractor making “half as much as I am” - which by the way I’m on the lowish end of BigTech compensation - would you not take a contract for two years that paid you a total of $100K+ more than your average compensation?
> Hope this clears it up a bit for you, though reading your deep replies makes me think you came here with an agenda
As someone whose career has a longer arc than most people on HN and have been on both sides of the “average software engineer compensation” and “BigTech compensation” divide, and has had 6 jobs since 2012 (the other two I kept for 3 and 9 years respectively before 2012), I can’t really muster any outrage at a CEO. I don’t expect any better.
It’s more like the tale of the
snake and the old lady.
Thanks for responding constructively. Apologies for being a bit jumpy. If I misconstrued your replies then double apologies.
> I’m also jaded. But to the point where any job is merely transactional and I don’t take it personally when the transaction of “trading labor for money” is not seen as mutually beneficial to both parties.
Yeah same. It's a transaction and I've made the mistake to look favorably -- almost friend-like -- at people who hired me, and got burned every time, long ago. Never again. Story for another time, likely never, but suffice to say that I was fairly innocent and believed in long-term partnerships based on me being useful alone (i.e. the only metric; turns out there are a lot more, yeah I was stupid).
Getting fired because the CEO had lunch with a Microsoft representative and he figured we will no longer work with the tech I was hired for and will look for new devs, or getting fired because you carried a single project that made $300_000 in a weekend on launch and they didn't want me to start asking for % of profit -- and a few other such cases -- opened my eyes.
> Who was “inconvenienced” by making $250K+ for a few years and getting laid off with a severance?
F.ex. having a tenure of only 5-6 months in a FAANG, sometimes 18 even, doesn't always look good on a resume. Or simply being fired at this exact time, people can do the math and they rush into judgement and figure you were the bottom 10% cruft that needed to be pruned. And you can't ever change their minds and give them the facts, they already made up their mind and view you negatively. It's maddening but with time I started making my peace with these brain bugs that many people have.
But yeah, I'll agree it is very far from critical.
> If you are contractor making “half as much as I am” - which by the way I’m on the lowish end of BigTech compensation - would you not take a contract for two years that paid you a total of $100K+ more than your average compensation?
I am not opposing you deliberately but nowadays? It's 50/50. Not all money is worth the stress. I get what you're saying though, if I was convinced that I can protect my mental health then yes, I absolutely would take that deal.
> I can’t really muster any outrage at a CEO. I don’t expect any better.
We 99% agree here. I can't muster any outrage about almost anything these days. Personally, I realized that I've lived in a fantasy most of my life (how that is possible when most of my life has been hardship, don't even ask because I can't answer that to this day) and got dead-focused on adapting and being a realist.
With me being a fairly paranoid and thorough programmer, you can probably guess that I turned into a bitter cynic in a matter of weeks. :D When you remove what's blinding you from reality but you're already smart and perceptive (I hope), it takes very little time to start seeing the world exactly like it is.
So yes, I can predict most corpo bullcrap and am usually seeing it a mile away.
My bitterness and occasional caring and ranting (like in this very thread) stems from the fact that it's extremely toxic and discouraging to be able to see how are things happening, what's their motivation and even their very likely conclusion... and not be able to do anything about it... yeah, it can ruin my mood and throw me into a grim broody state of mind for half a day.
I don't view it as a negative thing necessarily. I like it. Means I can still feel and not be completely detached like a robot making scientific observations with zero engagement.
But yes, it's a fine line to walk. Lean a little bit on the one side you start getting these pesky unhealthy things called expectations and thus get disappointed, lean a little on the other side and find out you wouldn't care about anything unless a nuke turns your life upside down.
It ain't easy to be both (a) smart and perceptive and a realist, and (b) excited for life. I am trying every day.
I know, it's a corporate platitude. It doesn't "mean" anything, but it just rubbed me the wrong way. "Taking full responsibility", to me, would imply some sort of sacrifice on your end.
Words are cheap; hell, I can say that I take full responsibility for the Google layoffs. I have never worked for Google but I did about as much as Sundar Pichai to take responsibility for the layoffs.
I agree, but that’s still manipulative. “Get mad at me, with whom you have no recourse whatsoever, rather than considering whether anyone else might have contributed that you could possibly effect.”
Wouldn't adding that to the statement have the same effect but also be honest? Perhaps the effect would be even greater given that people wouldn't feel like the need to guess at the real reason?
I guess it's better than some approaches such as "we can do better."
You could see it that way, I guess. To me there's more requirements to taking responsibility than to just claiming such, especially dishonestly. Some quick research suggests my interpretation isn't solely my own.
That's what private companies are supposed to do though. They exist to make a profit. The type of people working for Google will be the first to get hired when the economy picks up again, if you really care about the impacts of boom and bust don't worry about what the private sector is doing, think about advocating for a federal Job Guarantee which helps those who need it most:
> That's what private companies are supposed to do though.
Google is not a private company though.
> The type of people working for Google will be the first to get hired when the economy picks up again
So instead of spending the time looking for a job, possibly relocating, settling down, getting used to a new workplace, etc, and staying there, they get to do all that and then do it again. This is not a trivial set of events to have to redo.
> if you really care about the impacts of boom and bust don't worry about what the private sector is doing
The distinction I’m making is between public sector and private sector, not privately held versus publicly traded
>> if you really care about the impacts of boom and bust don't worry about what the private sector is doing
> This makes zero sense.
No it makes 3 sense.
The private sector will always boom and bust. If you try to solve that with regulation you a) can’t and b) just make it harder for smaller businesses to compete.
Only the government can offset the whimsy of the private sector and prevent the inevitable boom and bust cycles of private investment from destabilising society.
Yeah. This would put a floor on working standards. Living wage. Health care. Vacay. Etc. Make the private sector compete for labor. Rising tide lifts all boats.
It's what private companies are supposed to do since adopting the Jack Welch way of doing business. Before that was thought all around MBA schools businesses had a social duty to society and their employees as well.
Touting that as the only reality that could exist is not knowing the past, shareholders-first mentality and extract-as-much-profit-as-possible types of business are a thing from the 80s onwards, after Welch gutted GE's engineering prowess to become just another financial scheme.
Finance capitalism is the main issue, businesses are supposed to provide value to society first which they can profit on after.
Unfortunately, people actually need to make money first and then help society second.
Survival basics are to help yourself first and then help others. Since neither people nor businesses can survive without generating money, this situation we are in seems natural.
Take away people's dependency on money for basic needs, and you will get a lot more businesses that can safely operate for the good of society first and profit second.
I am no fan of Jack Welch, and I do blame him to some extent for things being frustrating now, but honestly it just feels like he's "yet another horrible leader of a company".
You can look at basically any capitalist during the Gilded Age or the 1920's and see plenty of clear cut examples of them valuing profit substantially more than "doing the right thing". They didn't treat their workers terribly well, they destroyed large chunks of the environment, and they became richer than anyone could possibly imagine.
Sure, people like Carnegie would later talk about "social responsibility" of rich people, and to some extent I'm sure he even believed what he was saying, but that doesn't really detract from the fact that he still fundamentally made most of his money off suffering of others.
I'm certainly no expert, but I believe all that historical talk about corporations doing the right thing by their workers (and by extension, society) came after many years of struggle (unions) and regulation (trust busting etc).
This is just an idea that I have, I'm not sure if it's even true. In any case, corporate speak is and always has been tuned to what the public expects of the corporation (current example is the whole LGBTQ+ signalling). Don't get it twisted: corporations aren't people and they don't really have feelings. They don't care about you; they're incapable of caring about you.
Would those 12 thousand people at Google have been better off if they hadn’t work there? Would you have not taken a job at Google if you knew that you would be laid off four years later or would you have saved aggressively and been preparing for your next role?
But in a normal tech hiring market, I’ve given up full time roles for a six month contract to perm role that paid slightly more. But built my resume.
I would have definitely jumped at my current $BigTech remote role where I made over $150K more over two years than I was making at a 60 person startup I left even if I had known the job would have lasted two years. No I wasn’t laid off. This is purely hypothetical.
“Hurting” the elite has always been up to the public.
Teacher strikes and unionization efforts have been winning; the financiers know nothing about self sufficiency. They know they rely literally on someone else to grow the food, kill the steaks.
The white collar public have a credibility problem; they want to be served and not serve themselves.
There is zero reason for most tech workers to login tomorrow; the vast majority will never move the needle. Yet they’ve learned helplessness and don’t know what to do.
We carry on about ills of LLMs hallucinating while westerners hallucinate the they can just do data entry work and someone else will wear out their bodies procuring food.
Our AI is more like us than we want to admit, which is why they’re so terrible.
If you like some real numbers; <600 elected Federal officials, only 1 million LEO from federal to local, and very few billionaires and mega millionaires.
All propped up by labor of tens of millions.
Let Jamie Dimon go door to door for those mortgages. 10k NYC cops threatened to strike over vaccine mandates; only 34 did. Let them see police work for pay not fealty.
Among the urban working class in cities like Chicago, union interest has been rising rapidly across a variety of sectors. Retail, education, warehouse labor, museums are all seeing increases in union activity. The mayor-elect is a former union organizer.
Chicago is certainly one of the more pro-labor cities in the US, but they’re not the only ones seeing growing interest in organized labor. The Democratic Socialists of America membership grew from 6,000 to 90,000 in less than 10 years.
The question was not about unionization, but the accomplishments of said unions, which remain to be seen. Unions that lack the strength to strike are a net negative.
The mayor elect didn't even support Bernie Sanders lol.
DSA membership has been nosediving for the past 2 years because DSA is effectively an appendage of the Democratic Party.
They gamble with high risk and no stakes. If it works out, get win big. It it fails, they get to layoff people, restructure the company, and earn a small millionaire bonus. There's literally no losing for them.
You are presupposing that boom and bust hiring is bad, and worse than a more steady state approach. If one assumes perfection is impossible, it seems you suggest erring on the side of perpetually under-hiring as opposed to ever over-hiring. Why is that better?
This is more true in non-tech fields pre-pandemic. These days remote positions are more prevalent than ones that require relocation in tech and some other fields.
Cry me a river, the same people who demand a long-term commitment from their employer will jump ship in an instant for 10k more after 6 months of employment. Companies are full of them.
When a person moves to another company, the company doesn't have to move to another state and restart its social life from scratch. The person with more power, needs to take more responsibility. Holy batman, sometimes I feel like people don't even have a heart anymore.
Because I thought in America businesses were people. And I have been fortunate enough to work with businesses which seem like they have a heart. Consequently, I've rejected several offers to come work in America for extra pay. I think a system which is purely transactional is inferior, boring and at times immoral due to power imbalance. Society is not a computer program, businesses exist in society and they should behave like that.
I don't understand how you don't understand that. It's a power differential that frustrates people. You can be fired from an employer without it affecting their bottom line, but having it drastically affect your bottom line.
Also, what the hell are you talking about about them "not demanding loyalty"? Big companies demand loyalty all the time. When I worked at an Apple, I had to sign a whole bunch of non-compete forms. Talk about "demanding loyalty"; I technically wasn't even allowed to open a Github issue on an open source project without permission. The only leverage you have as an employee is quitting.
The same way a company can find another employee, the employee can find another job. Also claiming that leaving a company doesn't affect a company's bottom line reflects more about the quality of the work the employee does, rather than the economic reality of the company. If your work doesn't affect the bottom line maybe you shouldn't have the job, that's why you are getting paid to have an impact on the bottom line, not to drink latte, have yoga sessions and raising your children while you are 'working' from home.
Where did I actually say that companies do not ask for loyalty?
I think your first paragraph is sort of self-evidently silly so there's not much to say there. Good employees leave, or die, and most of the time it doesn't kill the company.
> Where did I actually say that companies do not ask for loyalty?
You didn't explicitly, but you did say "worker makes it fairer to demand loyalty but not reciprocate". I'm claiming that the non-competes already demand a lot of loyalty, but the companies do not reciprocate it.
> I think your first paragraph is sort of self-evidently silly so there's not much to say there. Good employees leave, or die, and most of the time it doesn't kill the company.
Yes it's so self-evident that even you argument for it is moving the goalposts. Just to remind you, we are talking about an employee leaving affecting the bottom line of the company, not the company shutting down.
> You didn't explicitly, but you did say "worker makes it fairer to demand loyalty but not reciprocate". I'm claiming that the non-competes already demand a lot of loyalty, but the companies do not reciprocate it.
Loyalty is implicit, not some terms you sign on a contract. Duh, you have to follow those for legal reasons, not because of 'loyalty'. But let's indulge you.
If your contract has a non-compete and you want to see reciprocation of the loyalty, ask to add in your contract the terms that would made you feel it's a fair exchange of loyalty. Otherwise don't sign the contract. But of course you will sign it because you like that fat paycheck high-tech/finance is giving you - won't accept to work for those pesky companies that can't afford non-competes for a lower salary. You make it sound like non-competes are a common thing except for the ridiculously well-paid white-collar jobs.
The reason no one shows loyalty is exactly because it is not reciprocated. Why should the employee have to be loyal when they are just a number to an HR department and the CEO will strike off their job without a second thought? You have things backwards. People used to be loyal, back when you could work at a place, grow your career, and retire with a pension. It wasn't the laborers who broke the loyalty deal.
Yes because we all know self-reported data from employees on how loyal they are and how bad corporations are is a reliable method to come up with studies that are worth the paper they're written on. Get a grip.
It's unclear whether that would be better. In control theory, underdamped systems are generally preferred as it allows you to reach the desired value rapidly even though you often overshoot.
Overdamped systems (IE hire in moderation) can be very slow to respond and often spend the majority of their time in the un-desired regime.
It's quite possible that tech over-hiring when people were forced to work from home yielded a net good for society even though many of those hires were let go a couple years later.
He's advocating that the powers-that-be should consider targeting a slightly underdamped hiring system. Where they over-hire, and as they're overshooting the goal then reduce the rate of hiring, allowing the normal low rate of attrition to bring the PV back down to the SP.
e.g. a one-half critically-damped system. something following a standard first-order ODE like:
where h is the instantaneous number of employees, h* is the desired number of employees, f(h) is your attrition rate as a function of current number of employees, and Kp and Ki are "rate of hiring" coefficients which will be your proportional and integral terms of a PID controller to control your rate of hiring. The point is, the "rate of layoffs" here is zero and doesn't appear as a term.
Is this a proper model for a human organization? Who the fuck knows but it's the model you're advocating for and I'm just re-explaining what the other guy you replied to was suggesting in the first place, but this time using your framing. Yes, he also mentioned they should consider a slightly over damped system but he 100% did advocate for considering an underdamped system.
Ehhhh, your argument was more that "severely underdamped" could be the best, even if it requires an additional forcing factor (firing/layoffs) to bring it back down to the setpoint.
The person you replied to was arguing that perhaps something a bit more mildly underdamped could get rid of the requirement for that extra complication (firing / layoffs).
Yeah, and I disagree. Goal should be to get to the setpoint as quickly as possible even if you overshoot as human nature is to keep the status-quo which generally means talented people wasting their time at obsolete companies.
Control theory in sociology proposes no such thing. Your using an engineering term used to describe machines which is largely the point; human capital being as disposable as a cog in a machine.
Tech companies over-hire to excess and then under-hire to excess. It's like people trying to follow a 1000-calories/day diet who then give up and eat 4000 calories a day. They are never going to hit a healthy weight. Neither is my jackass company, who has laid off more people in 2023 than we hired in 2022, and is still on a hiring freeze.
Honestly, I think this is a wicked problem, in that it's impossible for us to know in advance what the right decision would have been. Was it foreseeable that the economy would be volatile post-pandemic? Yes. Was it guaranteed that it would mean layoffs? No.
In addition, what about the boom itself? What if you're cautious but, during that boom period, you get outcompeted in key areas as a result? This might put you in a worse situation during the bust phase than if you'd over-hired.
Hindsight is 20/20, so I prefer to avoid being judgemental over these types of decisions, while still holding people accountable to doing the right thing, even in tough times.
Or lots of individuals just don't get hired and you'd have had lots of people railing against headlines like "Despite surging demand, companies keep hiring choked off."
To use an even more reasonable framing, absent some small numbers effect or some really high-impact shock, it's incredibly stupid to almost double the size of a company in one year.
That's how you lose your culture and throw the dice again on market fitness. (Well, that and randomly firing people.) Knowledge work just can't scale that fast, and nowadays every work is knowledge work.
What those companies did is bad from every possible point of view.
Because it doesn't create unnecessary suffering for the unfortunate people who find themselves out of a job because some executive over-allocated for a particular role or department. Fundamentally, we want people to still participate in the capitalist system and not reject it because they're constantly treated like cattle.
> Because it doesn't create unnecessary suffering for the unfortunate people who find themselves out of a job because some executive over-allocated for a particular role or department.
Unnecessary suffering is going to happen either way. Keep in mind, at the time of hiring, there is real demand, and while "forever" is more than a bit ridiculous (and no doubt a misrepresentation of the executives' thinking), the truth is nobody knows exactly how long it will last, so you're getting it wrong no matter what you do.
> Fundamentally, we want people to still participate in the capitalist system and not reject it because they're constantly treated like cattle.
That some people don't always have a job is part of the capitalist system. What happens to them when they're not employed, that's not about capitalism.
> That seems like a big claim for which I haven't seen any evidence.
Umm... the entire basis for the article was that there was a belief that market conditions at the time would remain true "forever". That's a very different delusion from thinking there isn't something there.
...and there's plenty of evidence that there was real demand. Real revenue grew significantly during that time. Streaming services saw significant increases in subscriptions. Computer sales were up. In tech in general, sales were up across the board. If you haven't seen any evidence of increases in demand during that time period, I don't think you'll ever see evidence of increases in demand.
Sounds like you're equating 'demand for more engineers' with 'available cash' for any given company. I think you're mistaking demand for ability to purchase.
Increased sales do not intrinsically require more engineers at most companies. It is possible for some companies to have required increasing engineering resources to cope with scale. But the vast majority of hiring was for people to work on future additional features to attract more customers. Zoom, Rec Room, DocuSign, and some other companies in that direct line of moving work and socializing online, yes. Facebook, Google, Salesforce, almost everyone? No.
Companies generally don't require more engineers, ever.
However, if there is demand for your product, engineers are a good way to make it better. If you don't make it better, that demand will go to a vendor who does.
Either way, if you believe these companies never needed the engineers in the first place, it is an entirely separate claim from the claims in this article.
And I'm not presenting some amazing new idea. People have been discussing for years that these companies hire people just to have them, not for business goals.
...and to clarify, you aren't addressing a claim that I made. You're making up an entirely different claim that is unrelated to my statement. You are contending that these companies don't know their operational needs and consequently hire and fire in arbitrary/capricious fashion. That may be, but it's irrelevant to the article or my point.
As you have pointed out, there has always been stories that large companies have unnecessary hires, and engage in strategies of cornering the market for labour. From that perspective, there has NEVER been demand for resources, there is no rationale for hiring more or fewer people, and nothing would constitute as "evidence" that there is demand.
Now the stuff you cite is not really supporting evidence of that. It's evidence that large companies often are inefficient and under-utilize use of their workforce. That is definitely not a new idea, and is well supported both by evidence and simply by intuition about the challenges of efficiently organizing people.
My claim was that given shifting labour demands, it's not necessarily "less harm" to under hire because at some unknown point in the future you may not want to have those hires.
Now, when you claimed that there was no evidence of an increase demand for labour... which really had nothing to do with my point. In part of my response to that claim that there no evidence with a statement that if there ever was evidence of demand, it was at that time.
There was, in fact, evidence. Maybe not sufficient to convince you, but certainly enough evidence to convince hiring managers. What there wasn't evidence of was that this increased demand would sustain itself forever. There never is. The idea that there is less harm in not hiring people because there is reason to believe that demand might decline at some unknown point in the future is just wrong. Sure, if you know that you only need someone for a week or a month, you shouldn't hire them for a long-term position. Not only is it harmful to them, but it is harmful to your organization. However, even if you know that need might dissipate at some unknown point in the future, if you know you need someone until something changes, there is no harm reduction in not hiring.
If a boom-bust cycle creates an economic surplus, then people suffering is an issue of negative externalities and unfair distribution of resources. The solution is to pay people who got laid off, not under-hire.
Agreed. Another way to justify this behavior is that "pessimists don't get promoted" So you're either a growth CEO or a restructuring CEO. Wall Street has no interest in administrator CEOs.
CEOs are definitely something we should reconsider in this day and age. There's something about the kind of fiefdom that they command that I don't really know the term for it - immoral? Unnatural?
It's not just companies; almost no organisation is democratic. And this makes sense: how would I as a person leading a team making a bit of software understand all the information required to make top-level business decisions? That's more than a full time job.
It is naive for anyone to view a job as anything but transactional. Do you expect your employer to isolate you from economic storms? Would the people who worked at BigTech during the boom times have been better off not getting hired and making at least 3x-5x the median wage?
I was hired at BigTech in 2020 going straight there from a 60 person company. I have used every single penny of my signing bonus + RSUs since then to improve my financial condition. I kept my resume up to date and my network strong.
A part of me thinks that many have failed to educate themselves about the realities of life. People are dicks (generally) and if they can step on you to better themselves they will. It's why capitalism works.
And many of the people who are working in tech now, have never known anything but boom times and got high on their own supply thinking they are special snowflakes.
I saw my BigTech job that I got late in my career as just another job. I was just as prepared to get laid off, pip’d as I would be for any other job.
Not sure I'd characterize ex-FAANG employees, who are still likelier to get future job opportunities than people who loyally stuck it out at No-name Software Co in Des Moines, and who probably made 200k+ for a while, "little people".
You are doing their job for them. A worker with slightly better prospects than others is still just a worker and ultimately still in the same precarious situation as they must still seek employment to earn a salary to live.
>ultimately still in the same precarious situation as they must still seek employment to earn a salary to live.
But earning a salary that, when used well, can last several YEARS of unemployment, makes them a very different category of worker. These are the last workers that need help, of all the world's workers.
Ultimately the parent comment is about accountability.
This is an extreme example, but if a billionaire kills another billionaire, would you "forgive" the perpetrator because the victim was relatively privileged compared to any other potential victim?
No. That's not how accountability works.
It is irrelevant here whether "even littler people" exist.
In some sense yes, if they couldn't live only from the return on their investments, they are technically a worker. That would be the Marxist definition but it's obviously more of a spectrum than a binary. CEOs in most large companies of course have enough wealth that they could live on that alone and they are only working as CEOs in order to increase that wealth. Their work also plays an anti-labour role in collaborating with the shareholder class against the interests of the worker.
I suspect there are quite a few software engineers who have been making $250K+ for some years who could live on the return on their investments alone.
I mean, I guess it also depends on live at what standard of living. At the standard of living they are "accustomed to", or at the standard of living of someone making $50K a year? Some larger number of software engineers who have been making $250K could live on their investment income alone for equiv of $50K/year after taxes.
So, right, more of a spectrum than a binary -- you see why some people are dubious of whether a software engineer making $250K a year is really in the same class as a retail worker making $50K a year (or less; federal minimum wage is still $7.25; my state's minimum wage is $13.25, less than $30k/year, a shockingly small amount to many of us, that many people actually make)
On other conversations, people have suggested that whether you are a "boss" and can hire and fire is determinative. But again, a fast food "manager" might be making only $50K a year, while a software engineer who does not manage people might be making $250K or more. The software engineer is a "worker" who definitely has the same class interests as a walmart worker, but the fast food manager is definitely not? Doesn't really check out.
You say "the Marxist definition", but I think that's actually a huge over-simplification of a Marxist analysis. Your class position and interests have to do with your income, your "relationship to the means of production" (role in the economy), your wealth, and other things. And it's probably useful to consider more than 2 or even 3 classes, and sub-classes within classes.
I think it's a huge over-simplification to claim that every software engineer making $250K surely is in the same class and has the same class interests as every fast food worker making $12/hour. That's not in fact a good Marxist analysis at all.
The pandemic made it pretty clear to me that there is definitely a class divide between the people in jobs where they paid to work from home (or in many cases, especially at first, stay home and not work); and the people who had to come in to get paid and/or who were were told not to come/laid off because there was no work to do.
Compared to the average American? No, indeed, you wouldn’t.
Compared to the CEOs and major shareholders of the biggest companies out there? Yes, one could make the argument.
There’s a bigger financial gap between someone with 1 billion, or even 100 million, in the bank and someone making 200k than between someone working at minimum wage and someone making 200k.
Although there are other relevant factors that would be worth taking into consideration when making such comparisons (quality of life and financial security come to mind), most of us actually are very small fry compared to them.
This is so ridiculous. Why are you comparing anyone to a billionaire? If you've been making 200k+ for a few years and you have FAANG on your resume, you should have no problem getting through a few months without a paycheck, further, FAANG will, certainly, give you a better chance in future job applications. A person making minimi wage has none of these advantages.
Software and tech companies have had multiple boom and bust cycles since the 1980s. Even in good times there are always a few companies that simply don't make it. If you go into tech, that's a choice, you know you won't have a job for life, and you need to plan for such. If that makes you uncomfortable, go get a job with the government, or learn a trade (are plumbers ever short on work?), or become a doctor/lawyer.
Why would it be reasonable to expect that employment rates remain steady in cases where demand for labor fluctuates downwards? A CEO isn’t failing by implementing a layoff any more than they’re failing when they increase headcount, they’re simply responding to market conditions. The real problem is viewing employment as some sort of charity businesses grant to employees, or even worse, an entitlement that people should receive even when a business no longer needs them. Employment is driven by ordinary supply and demand, and when demand goes down, so does employment. This isn’t a failure of leadership.
> The real problem that author doesn’t call out is that at the end of the day, the people in charge don’t get hurt from these irresponsible boom and bust hiring practices. These companies knew the growth wouldn’t last, nothing lasts forever.
It's one thing for small companies (such as Peloton) - for them, "overhiring" or "overbuilding" can indeed be fatal.
But companies like Google, Microsoft, Facebook? They all were wildly profitable - there was no need to reduce headcount other than making beancounters and stock markets happy. They could have simply cut goose-chase projects and rerouted the staff towards stuff making money without letting a single person go.
No job can or should last forever. Being laid off is of course unfortunate, but suggesting that never hiring them in the first place would have been better seems... wrong?
Would you propose that companies should pay below market rates to create a buffer against these cycles?
Or perhaps not engage in competition with their competitors?
I think the conclusion here is that companies don't control this. If the market pays people more, they pay more. If there's heavy competition they compete and hire aggressively.
You can't predict these cycles. If you could you'd be a billionaire trading on the stock market. So anyone who says that now is just suffering from hindsight bias.
I think the root cause here is government action on monetary policy and interest rates.
> Just the law of large numbers says that eventually you reach all of the people who are likely to be your customers and you stop growing (see Netflix).
That has nothing to do with the law of large numbers. That's just discrete and strictly monotonic growth hitting any upper bound eventually.
To be fair, I've heard the term mis used like this numerous times on business news tv (CNBC for example). So it's possible in that context they've appropriated the term for a new meaning (basically they're talking about a logistic curve).
What I cited is just the mathematical reason why Netflix (or any company, really) cannot grow strictly monotonic in perpetuity. In reality, this is the reason why Netflix's curve will NOT be strictly monotonic, as you rightly pointed out.
Come on, thats a fallacy right there. One of the classic ones right? Instead of countering the argument by the opponent, you just pick one little part that you can nit-pick some element of and attack that instead.
Suuurrreee... the law of large numbers isn't a thing. So what?
> What a bullshitter.
Hm.
Call it whatever you want, secundum quid, inductive fallacy, faulting forecasting... who cares.
There's a point being made here and it's got nothing to do with the specifics of what the
curve is called.
It was bad, incorrect and incompetent forecasting to speculate that sudden sharp trends will continue as the 'new normal'. That's what people did, and it's blown up in their faces.
The point being made by this article is not that a bunch of people screwed up, it is:
> Your job isn't to assume things will always continue just as great as they are now. Your job is to be realistic about the future and position your company for whatever comes next.
Doesn't seem that unreasonable.
Seems like the sort of thing a whole lot of people in senior roles could have done a better job at.
Seems like advice that people right now should be paying attention to.
The point made by the article is valid. It is also entirely trivial, but indeed, who cares? Certainly not the CEOs or companies who ignored this point this time. I doubt that the CEO of Google is not smart enough to take this trivial point into account when contemplating his actions, so he must have ignored it for reasons other than ignorance.
I feel like the author here is not thinking through the opposite. What happens to the CEO if they plan for the market to stagnate and then it doesn't? Then they look like fools as their competitors take market share and then they get replaced.
The incentives just aren't designed to plan for decline.
Your comment supposes that it has to be extreme -- rapid growth or stagnation. Why do you think a responsible CEO / management team cannot plan for a 'moderate growth' pathway that sees steadier levels of hiring and firing more akin to what the rest of the industry shows?
I wonder if for tech companies part of the answer is also that moving people around is an 'easy' way to play with numbers. You go to the market / to your investors and say ''Hey, we've hired 1,000 people over the last 12 months, we must be doing so well [give us money]'', and likewise ''We're gonna lay off 1,000 people soon so we're all good here [give us money]''
Your comment supposes that it has to be extreme -- rapid growth or stagnation. Why do you think a responsible CEO / management team cannot plan for a 'moderate growth' pathway that sees steadier levels of hiring and firing more akin to what the rest of the industry shows?
They don't have a crystal ball. They study each possible conjecture, and then try to minimize risk maximize reward. Moderate growth might lead you to be eaten by a rapid growth. It's not a duality rapid growth or stagnation we are talking about. It's the risk of being eaten and left for dead in a competitive space.
>The incentives just aren't designed to plan for decline.
I wonder how managed printing service companies deal with this
I brokered a five year deal earlier this year, and all vendors put a 7% yoy decrease in print volume
I wonder what it looks like at the top of these companies like Fujifilm or Ricoh for printing sales people - are they diversifying or trying to converge on a sustainable level of revenue?
I think you’re right. It’s irresponsible/dangerous for a business not to try to grow as fast as it can, especially in as cutthroat a market as tech can be. Just how the system works, for better or worse.
However the “poor CEO gets fired with only a $10MM golden parachute” angle doesn’t play as well with the average reader
The article is missing a huge point. The companies mentioned in it did not lose anything at all, or an amount that is negligible.
They took advantage off the boom and made more money than they could in a normal situation.
They did not lose anything (at least the companies mentioned in the article) in my point of view.
They already knew they were going to fire the staff they hired. But they also knew that they had to hire more staff to take advantage of the situation.
Agree. Hindsight is 20/20. A conservative CEO who pulls back and doesn't lean into a growth cycle will be criticized even more for leaving money on the table.
Whether the entire economy should be structured to incenivize all this instability is a separate question. Don't hate the player, hate the game!
> They already knew they were going to fire the staff they hired. But they also knew that they had to hire more staff to take advantage of the situation
Exactly. People keep either saying CEOs are playing 5D chess or that they are fools... when reality is much simpler.
So much this, they didn't "over" hire, they hired who they needed at the time. That they don't need them anymore does not mean they didn't need them previously.
I don't know, seems like a weak article. It just names the obvious examples of companies ("tech"!) that over-hired and all that. Others still celebrated the increased demand but also planned ahead, and not everyone has laid off. Guess they don't talk about those.
Yeah, also doesn't mention the super low 3.4% unemployment rate the US still has. Most of the people being laid off are being re-hired within a very short timeframe. The Fed has wanted unemployment back up to ~6% for over a year and can't get it.
It's not that they specifically want less people to do work, rather, high employment is a symptom of an overheating economy in which hiring is (for now) cheap and it's difficult to replace people and meet high demand, because most people who would be looking for a job already have one.
The Fed believes higher unemployment will bring down inflation. Also, higher unemployment increases labor market flexibility so that companies can easily adjust their labor force based on fluctuations in the market. Low unemployment makes it hard for companies looking to hire and expand.
My understanding is that it will reduce overall demand because people cutback on spending to prepare for a recession, or simply don't have the spare cash to buy because their financial situation changes by becoming unemployed (or someone in the same financial household did).
The companies that celebrated the increased demand but planned ahead did not fall for the forever fallacy. They took advantage of the increased demand but didn't overhire to nearly the same extent. Apple did a much better job at this than Google and Meta.
Interesting, so it appears that you advocate expanding contractors and then firing them over full-time employment like with Apple.. I think it's likely we'll move to that environment naturally.
Everyone laughs at an empty factory and a warehouse full of products that won't sell.
However the damage from two factories that didn't get built and an empty warehouse that can't deliver more product can be even larger, even though it's usually hidden to outsiders.
I call it the forever fallacy. It's really quite simple. The forever fallacy is the belief that the circumstances that led to extraordinary growth will continue indefinitely, even when they obviously won't. It's the idea that growth, no matter how irrational, will continue because the change in circumstances that caused it is permanent.
The financial media writes this exact same type of article every time there is a correction, like in 2020, 2022, 2012, 2016, 2009, etc. And then as always, when least expected, prices come roaring back. Meta stock is up more than 130% from the lows of 2022. Same for Netflix, also up huge. Or NVidia. It generally pays to be optimistic and stay invested. It's always the same pattern. Price fall fast but then recovers so fast too. Yeah, maybe extraordinary growth will not continue indefinitely, but so what.
This stuck out to me too, glad someone else noticed it. Just in case people aren't aware, the law of large numbers is a phenomenon related to repeated random experiments, saying that the incidence rate of any particular event will tend towards the probability of that event. Referencing it in this context is a total non-sequitor.
It isn't a fallacy, it is due to incentives. The stock market reacts to the stories companies tell them and well received stories lead to higher stock prices in the short run so executives cash out during the good times, either by selling stock or demanding higher compensation.
How do you achieve infinite growth on a planet with a finite population and resources? It should be obvious to most, yet the supposed "smartest guys in the room" are the first to stumble through it.
> How do you achieve infinite growth on a planet with a finite population and resources?
Efficiency gains. How many "resources" are consumed by a piece of software relative to the "growth" that resulted from it? I can now have a machine generate 100 mediocre pieces of art for $20, two years ago each one would have cost $100 and taken a week for an actual artist to produce.
You can some gains this way, but they're limited in a couple of ways:
1. Yes, the resources consumed to make software are smaller, but they're still non-zero and will never be zero. So ultimately you're still limited by finite resources.
2. Many things just can't be implemented in software. I would point to A. Housing and B. Food production as things that are pretty hard to optimise. That isn't to say that we can't optimise them at all. We can build smaller houses or taller buildings. And we can transform energy from fossil fuels into fertiliser that increases yields. But growth in these areas is still very much constrained.
"Infinite" growth is funny, cos infinity is funny. Eventually there's gonna be some hard cap, but for all we know that's thousands of years away, so it's not really worth talking about. But we're still getting way more efficient at growing food and building infrastructure.
Like, about 150 years ago an American farm could get about 26 bushels of corn per acre. The last few years, we've gotten 174, about 6x more. And that's in a very favourable agricultural zone, chances are it's even greater in more marginal areas!
If efficiency gains were the secret go (infinite) growth, then companies would be able to grow their business without growing their workforce, building more factories, warehouses, etc.
They are the "secret". But efficiency gains (from methods, skills, technology) are usually harder to get and implement than scaling gains. Building a new factory is a known factor; investing in a new ecosystem of manufacturing machines, less so, especially if you have to retrain your workforce. But companies absolutely grow their business without using more resources.
Ininite growth isn't possible, but I genuinely believe near-infinite growth is.
That is an overabstracted viewpoint that assumes they just crank up a variable. How do the efficiency gains take place in the first place?
By creating something new that is more efficent. Even if we ignore economies of scale as a source of efficency there is a replacement curve in action which would create growth! A situation where they would immediately scrap the old equipment for the same payload and switch to a new more efficient one is extremely rare.
I don't follow your logic. Just because companies could grow their businesses without increasing their workforce it doesn't mean that they couldn't achieve a higher rate of growth by increasing their workforce.
My point is if it were possible we should see at least some examples of it happening. So far it is an often recited conjecture without any practical proof, so I remain sceptical.
> My point is if it were possible we should see at least some examples of it happening.
We see it all the time? Google's revenue is up last quarter despite redundancies meaning they have a lower headcount. Adding robotics to a car production line can massively increase the productivity of a single factory despite needing less headcount, often allowing other factories to shut.
Something like Intellij or Copilot can make the entire tech workforce more efficient _far_ in excess of what it cost to make.
What if the metric driving your stock is engagement and you've managed to somehow maximise it? How do you continue to grow when there's a finite number of people in the world and a finite number of hours in the day? There's also a finite number of ads you can show before you've enshitified your product and start shedding users, and a finite number of ways you can make efficiency gains when it comes to serving them (including layoffs).
Growth doesn't intrinsically have to have anything to do with population or resources. Growth is fundamentally about ingenuity.
If you develop a microchip that delivers the same performance but takes 50% less material and energy and cost to manufacture and use, that's growth. 2x growth in that area, to be precise.
As long as we keep thinking of cleverer ways to do things, we keep growing economically. So it's really whether you think human ingenuity will come to a dead end?
Most of us aren't in the position to make that bet.
The most I can afford to do usually is "leave this role because even though the press and investors are still on board, I don't think it's a good bet anymore." I've done it a few times, I've even been right about whether they'd make a good ROI on those new funds... and so I made modestly more in the new role than I would've by vesting more pointless options or whatever... but I couldn't really short those startups or subdivisions to make a fortune by them failing. While their founders/CEOs made a (small) fortune by failing, but in a big enough way.
> How do you achieve infinite growth on a planet with a finite population and resources?
For the sake of the argument below, consider that there are two types of growth: 1) "evolutionary" - as you correctly observe it is limited by the availability of the known resources, and 2) "revolutionary" - which discovers entirely new growth potentials.
History teaches us that so far the growth was not limited, but innovation was always a prerequisite for the growth and often unlocks new resources.
Now, it is true that in the past couple of centuries humanity was gifted, through a lot of human effort, with a series of innovations that were accelerating the growth ever since. Truly, we don't know if this will continue as such, or slow down, or accelerate even more, or if we are going to hit a wall before the next scientific revolution.
Finally, indeed it appears that resources are limited at some point (importantly: according to our current understanding of physics). But I trust that for all observable future there is still a seemingly unlimited potential for the growth, as long as we continue to innovate and don't destroy the resources. Sustainability (between the scientific revolutions?) appears to be a new part of the equation and we must take it seriously.
You squeeze people into living in conditions that make cattle in a factory farm today look good. As for convincing them? That's what propaganda is for.
Its easy. There are finite limits but if you aren’t near the limits your growth is indeed unconstrained especially if the pool of resources is incredibly deep.
If that was the case then GDP wouldn't be able to grow faster than the population. The fact that GDP per capita growth is a thing disproves that idea. And no, the GDP per capita growth of the past 50 years wasn't by simply using more natural resources either. Efficiency gains and new technologies and ideas can lead to growth as well.
The mistake people who ask this question make is assuming that growth must be contained on a single planet. As they used to say in a previous generation, mankind's destiny lies in the stars. And we don't get there by worrying about limits or by rejecting the idea that a better future is possible. Stagnation is a choice. Decline is a choice.
Really, we should be buying Google/Meta/Microsoft/etc stock because they will have interplanetary profits in [future]? I think there's a lot of other companies (both existing and not-existing-yet) that would capture a bunch of that growth first anyway.
Nah, the mistake people make is assuming that everyone actually believed all these companies would grow forever.
A huge part of recent tech valuations has been driven by "greater-fool" type pumping of selling questionable business models and half-baked ideas as fast as possible.
The problem I have with some layoff articles like this, is that they ascribe mass hiring during the pandemic to a CEO or single 'throat to choke'.
My experience is hiring decisions are primarily political in nature. Head of a team and salary/revenue ratios are solid? Better make a convincing but ultimately flimsy business case to get more heads. Otherwise, your fellow empire builder in another department will be more than happy to take that headcount. Multiply this by a few hundred teams and you see the magnitude of the problem.
Once you've played the game, grown your team with no real appreciation of thinking like an owner, you can ruthlessly mow down 10 percent of your team or seek that new role while Rome begins to burn.
Oh, they all know it's not going to last. But they cannot say it out loud. Why? Because the stock price will be punished and because someone's empire building promotion will be blocked if they don't agree.
Until they keep rewarding bullshit management practices, nothing will change. If the incentive system asks managers to build empires to get promoted, that is exactly what they will do. No manager is asked to be thought leaders. No manager is rewarded for making good calls.
Management in tech is quite literally babysitting engineers.
Investment capitalism is a pretty flawed economic model - the shareholders will always want more, more, more. In the tech world, once the market is saturated their only options are to (1) degrade quality of service but cutting costs in 'non-growth sectors' like customer service, or (2) cut labor costs by offshoring or importing cheap labor, or (3) merge competing companies for form monopolies that can set prices well above what a healthy competitive market would converge on. The executives will do all they can to game the system by investing in stock buybacks to raise stock prices (because that's the metric that controls their bonuses), rather than investing in R & D or similar.
This is the result of the wholesale financialization of the economy under the rubric of neoliberal policy over the past 40 years. The outlook is not very good.
Some additional context, hidden six paragraphs down to enable the clickbait:
>I call it the "forever fallacy." It's really quite simple. The forever fallacy is the belief that the circumstances that led to extraordinary growth will continue indefinitely, even when they obviously aren't. It's the idea that growth, no matter how irrational, will continue because the change in circumstances that caused it is permanent.
FWIW - does anyone know of a tech employee who took this fallacy into account when making a career decision? Say, they looked at a company, concluded that it was over-hiring during a boom, and would likely be cutting heavily during the inevitable bust. So - they didn't apply, or told the recruiter "sorry", or rejected the job offer, or made a career move to a more-stable ship?
I know people who accounted for this but took the offers anyway. For mid-level engineers during the pandemic the jumps in pay were absurd. So I definitely had friends who took a 40% bump knowing a layoff was possible/likely in a couple years but figuring it would still be worth it.
They did exactly what any company would do in their position as publicly traded companies. This finger-wagging from a free market magazine is dripping in hypocrisies.
If the author didn’t like how companies over-hired and built unsustainable labor forces, then they should criticize the market that creates these incentives. Of course, the day that Inc magazine becomes socialist is the day that Hell freezes over.
Ideally, then, perhaps the laid-off workers should not be hired. It is better that they are jobless today lest we hire them only to fire them tomorrow.
Given that Tech, compared to other industries (Mining, Energy, etc) is still in its early years - most tech companies optimize for Growth.
While more established industries optimize for profitability / stability.
What's happening now in Tech is that companies are beginning to graduate to these later years where they run into natural total address market plateaus where they need to shift from Growth to Profitability/Stability.
(Think Netflix).
And this transition from being a Growth company, to a matured business - is a hard transition for any company.
I disagree w/ the premise of the article. It's oddly assuming that leaders of these huge tech companies have no knowledge that the pandemic would end. Effectively calling them dumb.
It's just wording. I think reworded in the spirit of the article is "Leaders should _do_ better" and be more steady/stable with their project and hiring practices.
But it's simply good capitalism. You should grow and shrink with the times all while building a massive store of cash. The problem is, good capitalism makes people get used/burned and ignores... well people.
