Tech company layoffs skyrocketed last year, up 351% from 2018, amid trade concerns, emerging technologies and shifts in customer behavior.
That’s according to a report from Challenger, Gray & Christmas, a global outplacement, and business and executive coaching firm. In all, 64,166 tech company job cuts were reported last year compared to 14,230 in 2018.
Andrew Challenger, vice president at Challenger, Gray & Christmas, tells Channel Partners that the number of layoffs increased each quarter, starting with 4,731 in the first quarter and escalating to 23,909 in the fourth.
“Many tech companies, similar to companies in almost all industries, found they needed to pivot as new technologies emerged and consumer behavior shifted,” he said. “Large bellwether companies, like IBM, also implemented strategies to become leaner to better compete with emerging startups. We also saw a number of cuts announced due to trade worries with China.”
Several indicators point to a potential downturn this year, but it remains to be seen when it will occur if it does, Challenger said. Last year seemed to be the year tech companies prepared for this potential downturn, he said.
In terms of new jobs, December marked the second slowest month of 2019 in terms of tech hiring, according to CompTIA‘s analysis of Friday’s U.S. Bureau of Labor Statistics (BLS) “Employment Situation” report. Some 3,500 jobs were created last month.
Data processing, hosting and related services added an estimated 2,100 jobs, followed by computer and electronics product manufacturing with 1,500 new hires.
“Even this relatively small gain in technology manufacturing employment is notable, given that the overall U.S. manufacturing category shed some 12,000 jobs last month,” said Tim Herbert, CompTIA’s executive vice president for research and market intelligence.
Hiring in IT services, custom software development and computer systems design occupations recorded just 700 new jobs last month. The category of other information services, which includes search engines and portals, and other businesses that supply, store and provide information, added 400 new positions.
The modest gains in these four categories were countered by the loss of about 1,200 jobs in telecommunications. For the full year, telecom employment declined by more than 28,000 workers, according to CompTIA.
December job postings for IT occupations declined by about 7,200 from November. Occupations in high demand included software and application developers, IT user support specialists, systems engineers and architects, systems analysts and IT project managers.