In January, Alphabet CEO Sundar Pichai issued this statement to Google employees, explaining the company’s decision to cut its workforce by 6% (12,000 workers) after expanding by 57% between September 2019 and September 2022:
“Over the past two years we’ve seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today.”
Plenty of other tech companies are now coming down from similar hiring sprees. Meta, Salesforce, and Amazon, for example, all roughly doubled their headcount between 2019 and 2022, and all three have since conducted reductions in force.
One notable outlier: Apple took a more conservative approach, hiring at a much slower pace than the average of the 50 largest tech companies, according to data workforce-intelligence platform Revelio Labs shared with Charter (see graph below). And while Apple recently announced small cuts to some of its corporate retail teams, the company so far has avoided the type of RIF we’ve seen across the tech sector.
What workforce-planning lessons can people leaders learn from the recent expansion and contraction of tech companies? I spoke with Ilana Hechter, a partner in Oliver Wyman’s organizational effectiveness practice, and Wayne Cascio, a distinguished university professor emeritus at the University of Colorado Denver, about a more strategic approach to hiring. Here are their insights:
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