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Layoffs mean removing or firing employees from a job. Companies usually do this because they are unable to make a profit to pay their employees efficiently. Recently we are witnessing a huge number of layoffs by tech companies, especially the big giant ones. But not always these large


Layoffs mean removing or firing employees from a job. Companies usually do this because they are unable to make a profit to pay their employees efficiently. Recently we are witnessing a huge number of layoffs by tech companies, especially the big giant ones. But not always these large numbers of layoffs are done; we will discuss the reasons later. Many international big tech companies like Alphabet, Twitter, Microsoft, IBM (International business machines), CISCO Webex, Amazon, Meta, Salesforce and Indian big tech companies too like Swiggy, OLA, Unacademy, Byjus, Vedantu, Cashfree, Dealshare are laying off the whopping amount of employees from their companies.

In the month of January 2023, Microsoft layoff a total of 10,000 of its employees which is a total of 5% of its total workforce, Google layoff its 12,000 employees which is 6% of its total workforce, Salesforce layoff its 8000 employees and 18,000 employees were laid off by Amazon.[1]


  • Trepidation of Recession: Central banks of the world started getting cautious because of fear of recession. Firstly, because the pandemic hit right after the invasion of Russia in Ukraine happened. As a consequence, in most parts of the world, inflation is soaring and central banks are getting anxious.
  • Gloomy growth: Most companies are at stagnant growth. They were expecting growth in exponential but now they are even unable to make any profit and revenue from it. This slow growth is the result of pandemic levels.

Alphabet posted lower-than-expected numbers for its third financial quarter, where it fell behind both revenue and profit expectations[2].

  • Cost-cutting: Most companies are not able to make profits to pay their debt off. During the Pandemic, when the growth of these companies was exponential, they hired a lot of people. Hiring people doesn’t mean only headcount, they have to pay salaries to them. Now when they are not making enough profit and have to pay the debt, they are firing them off. Cost cutting is one of the main reasons for the layoffs.
  • Decreasing dependency on online platforms and services: During the pandemic, the whole world was in lockdown. All the services were closed like theatres, shopping malls, restaurants, café, grocery shops etc. then the online platforms were the only medium to reach out to these services. After the lockdown, it all changed. People are moving out going to movies, café, restaurants, and tourist places and due to this, the dependency on online platforms decreases. As a result, online platforms companies’ growth becomes stagnant. They are neither making a loss nor a profit.

These layoffs are not happening only in big giants tech companies but also in small companies too. These companies invest a lot in their business in expectation of revenue predicting growth but now almost all companies are in loss or at stagnant growth. This might be also because of a bad product, bad marketing strategies etc.


Now, this very important question. These layoffs have been done globally and not only in India. But these global layoffs too will affect India and Indian IT professionals. 

IT professionals laid off globally, among those 30-40% are Indian IT professionals and a significant number of those are in H-1B and L1 Visas.[3]

H-1B visas are non-immigrant visa that allows us companies to employ their companies in a position that requires theoretical work or technical work.[4]

 In the United States, most companies hire thousands of people from India and now after losing their job most of the people are struggling in the United States to find new options for a job in a stipulated time i.e., a few months given under these foreign work visas after losing their jobs. It’s a concerning matter for Indians who have been laid off in the U.S. If they failed to find a new employer in the U.S. within the stipulated time then they have to leave the country. They will suffer the most emotional distress. It is also unlikely for them to get help from Indian IT companies as they have slowed down or stopped hiring people by watching recessionary fear in the U.S. and inflation problems in Europe. People who are laid off will suffer the most emotional distress, they have to suffer emotionally and financially and their families, colleagues, relatives etc will suffer as well. The remaining employees will also have to suffer from some kind of emotional distress as they have to work under fear of layoff. As a consequence, this distress will decrease their potential to work and their productivity level. These layoffs of the company will create an impression in them that company must be going through some sort of crisis.


In today’s world, we are aware of the importance of IT tech companies to the growth of the country and the government does know as well. So considering the importance, the government should immediately develop a plan to slow layoffs happening in India and reduce the global layoffs that are affecting Indian citizens. In 2022, we witnessed a major amount of layoffs but according to some experts this year we can witness comparatively fewer layoffs than the previous year.

“Although the government cannot completely prevent major layoffs, it can take steps to address workers’ concerns and protect their interests. The government can also ensure easy access to funds for capital requirements and loan return policies for small and medium-sized IT firms. These steps will assist businesses in developing long-term strategies, overcoming immediate market challenges, and making preparations for the impending recession,” (Mr Bhaskar Ganguly, Director, Marketing and Sales, Mass software solutions said.)[5]


Back in the day, the government has shown its support and responsibility to develop the IT sector. They implemented good initiatives to maximize the growth of the country but now as this sector is going through some tough situations, govt. should immediately take the needful steps to improve the condition and also make important changes to the previous plans considering today’s situation. Government should bring some initiatives which make job security for the employees in the IT sector.

Companies are laying off employees thinking good about their respective companies but what about the social responsibilities they hold? Employers should have some kind of responsibility to their employees because these people are getting affected the most and suffer from emotional distress.

Author(s) Name: Anshika Batham (Dr. Ram Manohar Lohiya National Law University, Lucknow)


[1] < > Accessed on February 06, 2023.

[2]  < > Accessed on February 08,2023.

[3]< > Accessed on February 08,2023.

[4] Ibid

[5]< > Accessed on February 9,2023.