Despite the profits, Freshwork cuts the workforce: In a surprise move, California-based tech firm Freshworks has announced plans to lay off 13% of its global workforce, affecting around 660 employees, as part of its operational restructuring strategy. Well, this comes despite rising profits. Media reports suggest that Freshworks sees the move as necessary to streamline operations and increase efficiency amid a rapidly evolving tech landscape.
Although Freshworks raised its revenue and profit forecasts after impressive third-quarter results, it estimates a restructuring charge of $11 million to $13 million in the fourth quarter.
Profits rise, jobs fall: Tech giants cut jobs despite revenue growth
Freshworks is not alone in this approach. Major tech players like Google, Amazon, Intel, and Apple have also cut jobs this year despite reporting solid earnings. Google began 2024 with cuts in several regions, including the US, while Amazon’s Prime Video division also experienced cuts. Cisco, shifting its focus toward AI and cybersecurity, recently announced 6,000 layoffs, and Intel let go 15,000 workers as part of a cost-cutting initiative.
Even Apple, after reporting revenue of $85.8 billion in its third quarter, has reduced its role within its services division to double down on AI investments. The rise of artificial intelligence, economic recalibrations, and an increased emphasis on cost-efficiency are reshaping tech companies’ workforce strategies, challenging employees to constantly adapt.
What are the driving factors behind tech job cuts despite profits?
Despite rising profits, tech companies are laying off workers due to three primary factors—the rise of AI, concerns about a possible recession, and rising inflation and interest rates.
As AI becomes central to tech work, companies are increasingly automating roles, with firms like IBM cutting thousands of positions and freezing workers for jobs that AI could replace. An economic report of the president warned that 10% of US jobs could be at risk from AI, prompting tech firms to streamline their workforces. Economic uncertainty, exacerbated by a weak housing market and political instability, has fueled fears of a recession, prompting companies to cut costs, helping preserve cash flow. In addition, rising borrowing costs from the Federal Reserve’s rate hikes are straining firms that previously relied on cheap capital, leading them to prioritize debt repayment over expansion and further cut staff to control spending.
5 Niche Skills Budding Techies Need to Enhance Efficiency
For aspiring tech professionals, these frequent restructuring announcements serve as a reminder that job security in tech is far from guaranteed. In this evolving market, staying relevant goes beyond basic technical skills.
Here are five specific skills budding techies should consider to make their CVs stand out, optimize skills and increase their value within the industry.
AI and Machine Learning Integration
With the rapid adoption of artificial intelligence in various fields, understanding how to integrate AI into business operations is an important skill. Professionals who can leverage machine learning capabilities or optimize processes through AI-powered tools can provide invaluable insights to employers looking to stay competitive. Familiarize yourself with tools like TensorFlow and PyTorch, and consider certifications in AI ethics, machine learning models, and deployment strategies.
Cloud security Expertise
As more businesses move to cloud infrastructures, the demand for cloud security experts is increasing. Unlike traditional IT security, cloud security requires specialized knowledge to protect data, ensure compliance, and maintain secure connections to remote servers. Expertise in cloud security protocols across platforms such as AWS, Google Cloud, and Asure, as well as understanding compliance regulations such as GDPR and HIPAA, can give candidates a competitive edge.
DevOps Automation
DevOps remains important for agile development and rapid software deployment, but now, the emphasis is on automation within DevOps to streamline workflows and increase productivity. Skills in CI/CD (continuous integration/continuous deployment) pipelines, automation frameworks, and containerization (eg, Docker, Kubernetes) make technical professionals indispensable. This expertise can help companies reduce operating costs while accelerating product release cycles, a highly valuable combination amid widespread budget cuts.
Data Engineering With a big data focus
The shift towards data-driven decision-making means organizations increasingly rely on robust data infrastructures. Data engineering, specifically focusing on big data handling and processing, is a sought-after skill. Knowledge of managing data pipelines using ETL (Extract, Transform, Load) tools, and platforms such as Apache Kafka, Hadoop, and Spark is in high demand. Companies with large data streams benefit from professionals who can help transform raw data into actionable insights.
User Experience (UX) Analytics and Optimization
For companies like Freshworks that serve broad customer bases, a smooth user experience is critical. UX analytics is evolving beyond basic design skills to include a focus on analyzing and enhancing digital interactions based on user behavior. Skills in using UX research tools such as Hotjar, Google Analytics, and usability testing methods allow technologists to directly contribute to improving product satisfaction rates, a priority in customer-centric markets.