Tech severance packages
Layoff numbers
It’s all over the news that tech layoffs are everywhere. It appears that layoffs in tech are already well above the pace of the Great Recession of 2008. The treading for 2023 is looking to be even worse. Some say that the fundamentals of this tech crash are much better than the 2001 dot-com crash, but we’re clearly on a very bad, and accelerating, job loss trajectory.
| Dot-Com crash of 2001 | 300,000 tech jobs lost, with around one million jobs lost total in following years. |
| Great Recession | 60,000 jobs lost in 2008 and 60,000 in 2009 |
| 2022-2023 Tech layoffs | 90,000-150,000 jobs lost in 2022, 68,000 in January of 2023 |
Many people have pointed out that these layoffs might have been completely inevitable due to the unbridled hiring during Covid. In some ways, painful as it is, this is now a return to pre-Covid tech employment levels as the jobs lost in 2022-2023 still only represent about 50% of those hired during Covid. For many young people who started in the last 10 years, this is their first experience of a crash. For vets, this is the 3rd.
Packages
So, what are the packages that many of these laid off employees are receiving?
Alphabet: 16-week base severance package with an additional two weeks for every year of employment at Google, Pichai said in a memo to employees. Laid-off employees will also have “at least” 16 weeks of share vesting accelerated and receive 6 months of health-care coverage.
Microsoft: Benefit-eligible U.S. employees are to receive severance, six months of health care and stock vesting, and 60 days of notice.
Amazon: Amazon is offering full pay and benefits over a 60-day period, when Amazon will keep them on the payroll but they won’t be expected to keep working. After that period, Amazon will offer laid-off employees several weeks of severance depending on their length of time with the company, a separation payment, transitional health benefits and job placement. It’s unclear if Amazon’s severance package includes any provisions that would allow employees to accelerate the vesting of stock compensation.
Salesforce: Laid-off employees would receive a minimum of “nearly” five months of pay. Benioff’s letter to employees also said that laid-off employees would receive health insurance benefits and career resources. Severance packages would include six months of health-care coverage and a “minimum of two months outplacement support.”
Meta: Zuckerberg promised “every” laid-off employee 16 weeks of severance, plus two weeks for every year of service, as well as vesting of restricted share units and health insurance coverage for a predetermined amount of time.
Twitter: Musk had previously said that laid-off employees would receive three months of severance pay. But some Twitter employees said that when they got their severance letters, they were offered only one month of severance in return for a non-disparagement agreement and a waiver of their right to sue the company.
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