LinkedIn layoffs a response to slower revenue growth
LinkedIn is cutting 716 jobs, including management roles, and making organizational changes to speed up decisions. Despite LinkedIn’s layoffs, the tech industry is hiring.
Listen to this article. This audio was generated by AI.
LinkedIn is cutting 716 workers in response to a softer business environment. It joins a long list of tech companies that have trimmed their workforces, including parent company Microsoft.
Ryan Roslansky, LinkedIn CEO, detailed the layoffs in a letter to employees Monday, citing "shifts in customer behavior and slower revenue growth."
Roslansky's letter also described the layoffs as part of a shift to a flatter organizational structure. LinkedIn is "removing layers, reducing management roles and broadening responsibilities to make decisions more quickly," he wrote.
As part of Microsoft's third-quarter earnings on April 25, LinkedIn reported an increase in year-over-year revenue of 8%. In its third quarter a year ago, it reported year-over-year revenue growth of 34%. But LinkedIn continues to gain customers on its platform.
In the Q3 2022, LinkedIn reported 830 million users of its platform. Last month, it reported 930 million users, with 100 million in India -- a 19% increase in that country. But LinkedIn has also decided to reduce its China operations, which includes winding down China's local jobs app.
“We will focus our China strategy on assisting companies operating in China to hire, market and train abroad,” Roslansky wrote.
In January, Microsoft, which acquired LinkedIn in 2016 for $26 billion, laid off 10,000 workers, citing a softening in IT spending.
According to Layoffs.fyi, the tech sector has announced about 190,000 layoffs this year, which peaked in January with 89,000 cuts. But those figures are not offset by hiring data.
Tech hiring trends
Tech occupational hiring overall, which includes tech and non-tech sectors of the economy, grew by more than 28,000 jobs in the first four months of this year, according to an analysis of U.S. labor data by CompTia, an industry and tech certification organization.
A lot of companies continue to struggle to find the types of workers they're looking for.
Tim HerbertChief research officer, CompTia
In the tech sector specifically, jobs increased in the first four months of this year by just over 4,250 jobs, due to a strong April, where tech sector jobs increased by nearly 18,795.
Tim Herbert, chief research officer of CompTia, said tech firms have been vocal about the need to increase productivity and rein in costs outside of revenue generation.
In April, CompTia's research shows that employers listed more than 300,000 tech job postings. One area of growth is AI-related jobs, which accounted for about 8% of the job postings. Last year, AI jobs made up about 6% of job ads, Herbert said.
Overall, about 21,000 jobs advertised last month were for AI roles, compared to software developer positions at 84,000 and IT support at about 28,000.
Herbert said they are projecting about 3% aggregate growth in tech occupations for the year.
"A lot of companies continue to struggle to find the types of workers they're looking for," he said. "Companies of all sizes across every industry sector continue to invest in technology, and it continues to drive more of their operations."
Patrick Thibodeau covers HCM and ERP technologies for TechTarget Editorial. He's worked for more than two decades as an enterprise IT reporter.
