Are Layoffs Even Worth It?
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Over the past several months, companies have laid off hundreds of thousands of tech employees all with the goal of increasing profit margins and efficiency. But, they’ve also been handing out insane amounts of severance like 26 weeks of base salary and stock comp. This often adds up to over $100,000 for each employee, not to mention for senior employees like managers and directors. Combine this with the fact that these tech companies already have insane rates of turnover and you get the following question: are layoffs really worth it? Well, financially speaking, the answer is no for most companies as the savings due to layoffs are usually marginal. Most companies could’ve just frozen hiring for 6 to 12 months and ended up in the same position without a bunch of bad PR. But then, why did companies go ahead and do layoffs anyway? Well, the primary reason is pressure from large investors to take action and increase efficiency. This video explores how much money was saved by conducting layoffs and if layoffs were actually worth it.
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Timestamps:
0:00 - Severance
2:06 - Cost Savings Debunked
5:24 - Alternatives To Layoffs
8:47 - The Real Reason
Resources:
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Disclaimer:
This video is not a solicitation or personal financial advice. All investing involves risk. Please do your own research.
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