PayPal, NetApp Lay Off 3,000 Employees In Latest Silicon Valley Tech Cuts

Another round of layoffs at Silicon Valley tech companies happened on Tuesday, with companies such as PayPal and NetApp eliminating several thousand more positions across the Bay Area.

Beginning in October of last year, tens of thousands of jobs in the tech sector across the Bay Area have announced mass layoffs. Amongst others, these have included Twitter, Peloton, Facebook parent company Meta, Lyft, Opendoor, Chime, Stripe, Intel, Microsoft, and numerous others. Last month alone, Salesforce cut 10% of it’s staff, or around 7,000 jobs, in only their latest round after several other cuts last year, Seattle-based Amazon had 18,000 jobs slashed, with many coming in Silicon Valley cities such as Sunnyvale, and Google cut 12,000 employees.

While reasons for the layoffs have varied, they have generally come down to the Bay Area and Silicon Valley being more expensive with higher employee costs for things such as housing; the end of COVID-19; tech companies expanding too quickly during the pandemic when work-from-home jobs brought a greater demand for services; and a rise in AI and automation replacing many tech-based jobs.

Outlets like Forbes also noted that over a quarter of all jobs being cut were in HR, signaling that hiring and recruitment will be lowered in 2023 and that HR is going through an automation revolution itself.

Many of those reasons were cited by the companies behind the latest layoffs on Wednesday. In a press release, San Jose-based digital payments company PayPal announced that 7% of all employees, or around 2,000 in total, would be leaving.

“Over the past year, we made significant progress in strengthening and reshaping our company to address the challenging macro-economic environment while continuing to invest to meet our customers’ needs,” said PayPal President and CEO Dan Schulman. “While we have made substantial progress in right-sizing our cost structure, and focused our resources on our core strategic priorities, we have more work to do. We must continue to change as our world, our customers, and our competitive landscape evolve.

“Addressing these changes requires us to make hard decisions that will impact some of our colleagues. Today, I’m writing to share the difficult news that we will be reducing our global workforce by approximately 2,000 full time employees, which is about 7% of our total workforce. These reductions will occur over the coming weeks, with some organizations impacted more than others.”

Additionally, Cloud services and data management company NetApp, also based in San Jose, announced an 8% across the board layoff, affecting 960 people. In a regulatory filing, the company noted that the “planned workforce reduction is part of its planned efforts to realign resources to prioritize investments against its biggest opportunities in light of the macroeconomic challenges and reduced spending environment.”

Over 150,000 tech jobs have been cut since October

Tech and employment experts noted that this all has been following the current trend of tech company layoffs in the past several months, with no end currently in sight.

“Based on all these press releases, you can tell things have gotten bad because they keep falling back on both tech jargon and using many synonyms to explain the situation,” Julie Ochs, a San Jose-based headhunter and hiring specialist, told the Globe on Friday. “The more it sounds like bureaucratese and the more they focus on saying how they wish the best for people going, the worse the cuts usually are, as companies don’t want that big of a backlash. It all sounds cold and heartless for a reason.”

“PayPal, Google, and the others that had cuts the last few weeks have been a part of now over 150,000 tech jobs lost in the last several months. These companies are really struggling now after years of success. It’s not the dotcom crash like we saw in the early 2000’s and it is not like previous tech crashes either. These companies had to hit the peak at some point, and it was all that added businesses in the past several years and suddenly having the shore back that led to the other dominoes toppling.”

“There is a different feeling in Silicon Valley in 2023 compared to a decade ago. In 2013, you know, the sky was still the limit. Google and Apple and others were building gigantic campuses. New perks like free lunches and game rooms and massage parlors on site  made it an employees market with all these firms battling to get people. Now look what we have. Twitter having an auction of a lot of these wonderful things they used to bring people in . Google and Facebook taking out entire floors of workers. Salesforce barely even being a presence in the skyscraper that bears their name. It’s what every industry has happen to it eventually, but one they never thought would come. Which is also what car factory workers and steel mill workers thought before them too. And it’s not over yet either. More cuts are expected soon.”

More tech industry layoffs are expected in the coming months.