Apple pauses hiring outside R&D amid weak consumer demand for smartphones and computers
- The iPhone maker paused hiring last month, ahead of quarterly earnings, but it does not affect teams working on long-term initiatives
- Apple joins other tech giants in tapping the brakes on hiring in response to sluggish consumer spending and higher interest rates
The company took the step last month, ahead of a quarterly earnings report where it said that growth would slow in the holiday period. The pause generally does not apply to teams working on future devices and long-term initiatives, but it affects some corporate functions and standard hardware and software engineering roles, said the people, who asked not to be identified because the move is not public.
Apple joins other tech giants in tapping the brakes on hiring, a response to sluggish consumer spending and higher interest rates. The iPhone maker has fared better than many tech peers this year, but it is still facing an industrywide slowdown for smartphones and computers.
In a statement, Apple said that it continues to hire, “but given the current economic environment we’re taking a very deliberate approach in some parts of the business”. Apple added that it remains confident in its future.
“We want to be thoughtful and make smart decisions that enable us to continue fuelling innovation for the long term,” the Cupertino, California-based company said.
Apple shares, which had been up in late trading on Thursday, fell 1 per cent to US$137.55 after Bloomberg News reported on the plans. The shares are down 22 per cent this year, part of a broader pullback for tech stocks.
Some teams within Apple are still able to hire in special circumstances, according to the people, and the company continues to advertise new roles on its recruiting website. While new roles remain open, the actual hiring process has largely been placed on hold.
The move is part of a broader effort to rein in budgets, not backfill roles and decelerate headcount growth for some teams next year. Bloomberg News first reported on the push in July. As part of the belt-tightening, Apple laid off about 100 contract-based recruiters in August. Insider reported this week that hiring freezes are under way at the company.
Apple’s fourth-quarter report confirmed that its research-and-development (R&D) budget is not getting squeezed. R&D spending rose 20 per cent in financial year ended September, compared with a 17 per cent gain in the prior year. The company continues to work on future augmented- and virtual-reality products, as well as an autonomous vehicle.
Apple said in a filing alongside its earnings report that the growth in R&D spending was “driven primarily by increases in headcount-related expenses and engineering programme costs”. Total operating expenses increased 17 per cent.