Young Silicon Valley workers are in for a rude awakening as industry giants make major job cuts and ditch ambitious projects for the first time in their careers

sdelouya@insider.com (Samantha Delouya,Kali Hays) - TODAY

An attendee wearing Google Glass works on a computer during Google I/O Developers Conference at Moscone Center West on June 25, 2014 in San Francisco, California. Stephen Lam/Getty Images© Stephen Lam/Getty Images

The days of endless employee perks at Big Tech, like free laundry and private concerts, are coming to an end.

Workers now fear layoffs after tech companies that hired thousands of workers with high pay face a slowing economy.

"Winter is coming in the tech world," said one analyst.

The days of Big Tech excess are coming to an end.

Amid a streak of disappointing financial results, inflation, and international turmoil leading to battered tech stocks, companies like Meta, Google, and Microsoft are looking to rein in runaway costs.

For years, Big Tech companies have competed on pay and perks to lure workers in a tight labor market. Now, the endless hiring and allotments for employee travel, free food, and company swag are being replaced by budget cuts, new performance mandates, and even layoffs.

It's a first for many tech workers, an entire generation of whom have known nothing but non-stop growth and a bull market. To these employees, recent changes are "straight up heresy," as Bill Gurley, a veteran venture capitalist, put it in June. "During this rate-induced boom, competition for employees created a Disney-esque set of experiences/expectations in high tech companies."




Layoffs and hiring freezes are sweeping across industries, from automotive to big tech, even as the overall job market remains strong.

Last week, Tesla CEO Elon Musk called for a pause to "all hiring worldwide" in an email sent to executives. In May, the online used car dealer Carvana laid off about 12% of its workforce. The 2,500 affected employees were informed through a Zoom call.

Meta, the parent company of Facebook, implemented a hiring freeze for mid-level and senior-level roles. Uber also announced plans to slow hiring. Coinbase, the third-largest crypto exchange by volume, is scaling back and revoking job offers for some candidates who have yet to start.

Unilever, the consumer-goods company that owns brands such as Ben & Jerry's, Dove, and Vaseline, is cutting 1,500 global management jobs.

Despite these companies' moves, the broader job market is still showing strength. US employers added 390,000 jobs in May and the nation's unemployment rate remained at a low 3.6%. The latest job gains come after nearly a year of employers adding more than 400,000 jobs a month, a string of strong showings.

Even with the relative ease many workers would have in finding new roles in a still-strong job market, it's wise to be prepared, especially in case hiring cools. If you have been laid off or are concerned about your job security, it's a good idea to organize the documents and information you need in case you get let go.

Insider compiled a list of seven things to know from human resources and retirement experts. These tips are helpful for people who have been laid off, are now without a job, as well as people who have been furloughed, or have been forced to take an unpaid leave

There was something of an outcry at Meta, for example, when the company earlier this year decided to limit the timing for free meals at offices and took away the laundry service it offered to workers. Within two months, the company froze hiring. Now, employees are worried about it cutting headcount by as much as 20%, as managers warn workers of impending cuts, Insider reported.

Over at Google parent Alphabet, CEO Sundar Pichai told investors he is reviewing spending and projects "at all scales pretty granularly." The company has also put in place a hiring slowdown. In August, Pichai told employees there are "real concerns that our productivity as a whole is not where it needs to be for the headcount we have." Earlier, the company told managers not to approve employee travel and team offsites unless they are "business critical." Back in April, workers were getting a private concert by Lizzo just for returning to the office.

"It is a poorly kept secret in Silicon Valley that companies ranging from Google to Meta to Twitter to Uber could achieve similar levels of revenue with far fewer people," Brad Gerstner, CEO of Altimeter Capital, wrote in a recent open letter to Meta, asking that the company cut costs, especially in its metaverse pursuit. "I would take it a step further and argue that these incredible companies would run even better and more efficiently without the layers and lethargy that comes with this extreme rate of employee expansion."

This week, Elon Musk, known to be a demanding and mercurial manager, is expected to take over Twitter and make sweeping cuts to headcount. Anonymous employees at the company thought an open letter making a list of "demands" was something that could help them in their endeavor to remain employed. Instead, the company's chief privacy officer sent a companywide email informing workers of the "risks" associated with signing the document. All links to it quickly disappeared from company Slack channels, an employee told Insider.

Bucco Capital, a popular Twitter account that comments on tech and financial markets, called the Twitter letter "delusional," adding it may be "the true and final swan song of the decade long bull market."

Younger tech workers don't just have to fear losing perks. Their jobs may be on the line as well. Companies like Netflix, Microsoft, Oracle, Salesforce, and Snap have all laid off workers recently.

"Silicon Valley is seeing layoffs across the board for the first time since 2008," said Dan Ives, a tech analyst at Wedbush. "Winter is coming to the tech world."