Over 250,000 jobs axed already this year in America, including
61,000+ in tech, all while the economy “grows”
About this “Great Decoupling” we’re living through, historically, when companies made more money, they hired more people. Today, the biggest names are cutting headcount in record profit years, citing “AI efficiency” and “permanent leanness”. Economic models cannot catching this: the GDP-unemployment link is just… gone for whole slices of the economy
Revenue per employee is the Wall Street religion now:
- Fortune 100 Best companies average ~$900k per employee, while the general US public market average is ~$100k
- Bank of America? ~$900k. Amazon? ~$400k
However, the number is fake. Not only fake in the meaning of creative accounting, but fake in contemporary sense. The payroll is the only thing visible to the world, with contractors, gig workers, and the millions of people who drive the platform being invisible, or rather, the so-called employees. Amazon claims to have 1.5 million employees, yet their actual human presence is far more extensive: Flex drivers, third-party sellers, etc. If you’re not on payroll, you don’t count
And then there is the entire middle management culling:
management jobs are down 6.1% since 2022, executives down 4.6%. Firms are becoming flatter, not in the way that empowering employees. When you remove the muscle between the brain and the hands, things might move fast, but they also break - burnout, brittle orgs, loss of mentoring, less innovation. You believe you are being empowered until you find out that there is no one left to run interference, and your span of control has tripled overnight
What does it mean to ordinary people?
- Permanent job insecurity. It is the "Great Freeze".
Hiring of new grads lower by 44% since 2022.The majority has got so anxious to seek another job, let alone risk moving.
- Gig economy. It is estimated that by the close of this year, half of the US workforce shall be gig/contract. Great as long as you are flexible; crazy if you want stability. The true shadow cost is mental health
I have friends who enjoy freedom of freelance. And I also know those that are constantly anxious of whether they will be able to make the rent next month, and whether anybody would care if they suddenly vanish from the company group chat
