Apple joins fellow tech giants in putting a lid on hiring amid recession fears
- For now, most of the biggest tech companies are not talking about eliminating jobs, just reducing the rate of hiring, although Microsoft and Tesla have laid off workers
- Amazon staffed up during the pandemic so it could handle a surge in e-commerce spending, but that has now left it overstaffed in its warehouses
Apple is the latest major technology company to rein in hiring and spending plans, adding to the evidence that even Silicon Valley stalwarts are worried about a recession in the coming months.
The iPhone maker is looking to limit expenditures and job growth at some of its divisions, Bloomberg reported on Monday, though Apple has not adopted a companywide policy. The more cautious stance mimics the approach of its tech peers, including Amazon, Alphabet’s Google and Microsoft, which have all taken steps to decelerate spending.
The news sent stocks sliding and increased trepidation surrounding tech earnings season, which goes into full swing this week. It may be difficult for companies to reassure jittery investors. IBM Corp posted better-than-expected sales growth on Monday, only to see its shares slip in late trading.
For now, most of the biggest tech companies are not talking about eliminating jobs, just reducing the rate of hiring. And overall US job growth has not stalled. Payrolls increased 372,000 in June, beating the 265,000 estimate, with manufacturing jobs helping bolster the numbers.
The US added 25,000 information jobs in June, putting that category 105,000 higher than just before the pandemic.
But some tech companies are going as far as cutting jobs. That includes Microsoft, which said last week that it was eliminating some positions as part of a reorganisation.
The reduction affects less than 1 per cent of its 180,000-person workforce, and Microsoft still expects to end the year with increased headcount. But it follows a move in May to slow hiring at the Windows, Office and Teams divisions “as Microsoft gets ready for the new fiscal year”.
Last month, Tesla laid off hundreds of workers and closed a California facility devoted to its Autopilot self-driving technology, according to people familiar with the matter.