The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
At the end of 2023, it would be tough to categorise the year as just one thing - the year AI went mainstream, the year of hybrid work or the year of the acquisition.
For hundreds of tech and channel firms, however, this was the year of the layoff.
As constrained economic growth continued to bite and the industry felt the hangover of last year's supply chain challenges, it was often employees who bore the brunt.
Here, we round-up the most impactful layoff announcements and what they meant for the channel.
January
Amazon and Cisco
The year began with a resounding shock as Amazon and Cisco implemented sweeping layoffs within the first week.
Amazon, guided by CEO Andy Jassy, announced the elimination of over 18,000 roles, marking its most extensive workforce reduction in nearly 30 years.
Jassy emphasised the impact on the People, Experience, and Technology (PXT) and Amazon Stores organisations. In a public note, he stated, "Communications with impacted employees will commence on January 18."
Meanwhile, Cisco cut 673 jobs, primarily affecting software engineers, technical engineers, hardware engineers, product managers, and supervisors.
A Cisco notice indicated, "The termination will be effective on those dates or on a date within a 13-day period immediately following those dates."
Microsoft thins the ranks
Microsoft faced its first round of layoffs for the year, planning to cut around 11,000 workers globally, constituting approximately 5% of its employee base.
At the time Microsoft spokesperson declined to comment for CRN, stating: "We do not comment on rumour."
Google cuts 12,000 roles
As the AI landscape gained momentum, Google announced plans to lay off approximately 6% of its workforce, impacting around 12,000 roles. In an announcement on 19 January, CEO Sundar Pichai explained: "We've decided to reduce our workforce by approximately 12,000 roles."
SAP rounds out the Big Three
But January wasn't over yet and the layoff announcements kept coming. On 27 January, business application giant SAP was reported to be is laying off up to 3,000 employees - about 2.5 per cent of its global workforce - joining a growing list of IT vendors cutting their payrolls this month.
The layoff plans were disclosed this morning during the company's Q4/FY2022 financial results conference call where CEO Christian Klein said they are part of a "targeted restructuring in select areas of the company." "This will impact up to 3,000 positions and will include a headcount reduction amounting to about 2.5 per cent of our workforce," Klein said on the call, according to a transcript posted on Seeking Alpha.
Read on for a round-up of the biggest staff cuts, from Dell to TD SYNNEX, Ingram Micro and VMWare...
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
February
Dell layoffs trickle down to SecureWorks
In the first week of February, Dell Technologies felt the pinch of the deteriorating PC market as it disclosed plans to slash its global workforce by 6,650 jobs. The cuts represent five per cent of its entire employee base as Dell joins the bleak list of vendors who have announced major layoffs in the thousands. In the latest spate of layoffs, Dell blamed the slump of the global PC market for its cost-cutting measures, which will result in its lowest headcount since 2017.
"Dell continuously assesses our business to ensure we're set up to deliver the best innovation, value and service to our customers and partners. This is especially important as economic uncertainty has continued. Since June, we paused external hiring and reduced spending to navigate a challenging global environment," Dell told CRN at the time.
The following day, cybersecurity firm Secureworks was revealed to have told employees it was cutting nine per cent of its workforce, according to a regulatory filing, a day after its majority-owner Dell Technologies announced a round of layoffs.
Secureworks did not disclose the total number of workers affected by the layoffs in the filing with the US Securities and Exchange Commission.
April
CDW joins the fray
Though the tech sector continued to experience layoffs over the following month, the channel appeared to be largely resistant to the impact over the following weeks.
At the end of April, however, CRN revealed that IT solution provider CDW was laying off hundreds of employees in the wake of an announcement on 18 April by the company that its first fiscal quarter 2023 revenue would fall below expectations, and that it expects "intensifying economic uncertainty" to negatively impact the US IT market.
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
July
The contagion hits distribution, TD SYNNEX and Ingram Micro join the list
In July, it was the distributors' turn. Both TD SYNNEX and Ingram Micro were hit with mass layoffs during the month.
On 17 July, CRN revealed that TD SYNNEX had sent out an internal memo, offering voluntary severance packages to its US employees citing macroeconomic conditions and challenging industry trends. In an internal memo from CEO Rich Hume to employees, which was obtained by CRN, Hume said the voluntary severance program can "acknowledge the contributions and experience of our dedicated co-workers with enhanced benefits." "This has been driven by the need to reduce our costs due to current macroeconomic conditions, including challenging industry trends (primarily across the PC ecosystem), which you heard me reference in our earnings call last month," Hume wrote in the memo.
"The hiring freeze and travel restrictions have helped but have not been enough to get us where we need to be."
Despite the voluntary severance programme, the company began a formal redundancy process in September.
Just days after TD SYNNEX's first announcement, distributor powerhouse Ingram Micro also swung the axe on its US workforce owing to challenging market conditions. The company did not disclose how many employees were laid off or what departments were affected.
Ingram cuts carry over to EMEA
The layoffs carried over to its EMEA business via subsidiary, CloudBlue according to sources.
Over 80 employees had been laid off at CloudBlue in EMEA alone, and the Asia business was completely dissolved, while the cuts affected "around half" of UK staff, according to sources.
More cuts at Microsoft
July also brought further layoffs at Microsoft as the software and cloud giant continued to refocus its strategy around generative AI.
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
August
NCC group confirms second round of layoffs
In August, the UK's NCC Group confirmed that it was making job layoffs for the second time in six months. Headquartered in Manchester, with more than 35 offices across the globe, NCC Group employs more than 2,000 people, according to its website.
The cuts affected its UK workforce as well as staff in North America, the group confirmed to CRN. "As set out earlier this year, we have a renewed global strategy in response to changing market dynamics and client demands," said an NCC Group spokesperson at the time.
"These macro forces are affecting the industry as a whole, which is why we must establish strong foundations for the future. "Regrettably, this means that a relatively small number of our talented colleagues in the UK are in consultation and some based in North America have already left NCC Group."
The downsizing came after the LSE-listed group announced plans to shed 125 employees also based in the UK and North America in February.
Dell's partner-led sales strategy comes at a cost
Possibly the biggest announcement to hit the channel in August, Dell announced that it was pivoting to a 100% partner-led sales strategy.
Though this was largely welcomed by the IT channel, the plan brought with it a round of layoffs at the company.
In August, it confirmed that it was to cut jobs among its core sales teams as it adopts a new partner-led go-to market model that pays its direct sales force more to sell storage products through the channel.
"Some members of our sales team will leave the company. We don't make these decisions lightly, and we'll support those impacted as they transition to their next opportunity," a Dell spokesperson said. "We're always assessing our business to remain competitive and ensure we're set up to deliver the best innovation, value and service to our customers and partners."
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
September
SkyKick follows Microsoft's lead
September began with severance programmes at Microsoft cloud tools vendor SkyKick.
Early on in the month, the company confirmed that the vendor is laying off more than 100 employees worldwide. In a statement to CRN US, Todd Schwartz - co-CEO of Seattle-based SkyKick - said the cuts were a "tough decision" and due to "current market conditions."
"We are well positioned and remain steadfastly committed to ensuring our partners' success in the cloud over the long-term," Schwartz said.
Google makes further cuts, slows down hiring
Google also announced further layoffs at the beginning of the month as it also pulled back from hiring.
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
October
HPE makes cuts to North America sales team
In the third week of October, HPE's North America sales team became the latest to be downsized.
Hewlett Packard Enterprise's North America sales team has been hit by layoffs even as the company plans to hire new sales specialists as part of a stepped-up focus to drive core market-share gains in compute, storage and even high-performance compute/artificial intelligence.
The year of the layoff: A timeline of the biggest redundancies to hit the channel in 2023
Constrained growth and supply chain hangovers in 2023 sparked major layoffs across tech, here's a round-up the most impactful layoff announcements
November
Splunk feels the pinch after Cisco acquisition
In November, Splunk disclosed layoffs impacting seven per cent of staff amid its plans to be acquired by Cisco Systems for $28bn. The cuts affect US-based employees as well as workers in the Americas, the company said. The new round of layoffs will impact an estimated 537 employees at San Francisco-based Splunk.
While the vendor did not disclose the total number of impacted employees, the estimate is based on the company's head count of 7,675 as of 1 February, after a prior round of layoffs that impacted 325 workers at Splunk.
Broadcom acquisition finally impacts VMWare
Finally, at the end of the month, following the closure of the much discussed acquisition of VMWare by Broadcom, the embattled vendor began its own layoff programme.
The announcement for many VMWare employees came on 27 November, as reported by CRN US.
"It's a combination of disgust and disappointment," said one let-go VMware employee Monday of the mood inside the company as word of the layoffs rolled out.