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Members of Canada's technology industry say another wave of layoffs the sector saw this week is tipping the power dynamic back in favour of employers.
Tech workers have had more power to negotiate better salaries and roles in recent years because they were growing so fast amid pandemic-era demand and needed top talent to keep up, said Marissa McNeelands, chief executive of women's tech collective Toast.
Now that cuts have spread to even the most prominent tech companies with layoffs this week at Amazon and Google, she says there are increasing numbers of laid off workers. As a result, companies can be more choosy about hiring and less generous with salaries.
"So for the last year and a half, two years, it's really been workers who have the leverage, have the power and there was a shortage, and now we're tipping the other way," she said Friday in an interview.
Abdullah Snobar, executive director of the DMZ tech hub in Toronto, noticed the same shift and said it began about 12 months ago, after companies had been speeding to hire and borrowing money was so cheap that large salaries were even more possible.
However, inflation is now stubbornly high, interest rates have been hiked significantly and many economists foresee a recession.
"An employee can't walk into the interview and ask for everything under the sun anymore," Snobar said.
His assessment comes as Google chief executive Sundar Pichai told staff Friday that his company would be laying off 12,000 workers.
"Over the past two years we've seen periods of dramatic growth," he said in an open memo announcing the cut.
"To match and fuel that growth, we hired for a different economic reality than the one we face today."
Tech companies have been reducing their workforces since last spring, when valuations began falling and investor interest faded as consumers returned to pre-pandemic habits .
Earlier in the week, Amazon laid off 18,000 staff, Microsoft slashed 10,000 jobs and WeWork cut 300 workers.
In Canada, layoffs included 300 people at Lightspeed, 150 at Clutch and 70 at Hootsuite.
They followed other prominent tech companies like Shopify Inc., Meta, Netflix, Lyft and Stripe, which conducted layoffs over the last year.
Layoffs aggregator Layoffs.fyi has counted 55,324 global tech workers who have lost their jobs since 2023 began and 2022 ended with 155,126 departing.
The number of layoffs could also change how attractive Canadian tech workers are to U.S. companies. Canada has long lamented the "brain drain," a phenomenon where people educated in the country flock south of the border for jobs and financial or lifestyle reasons.
A 2018 study based on the LinkedIn profiles of graduates from the universities of Toronto, British Columbia and Waterloo in 2015 and 2016 revealed 66 per cent of software engineering and 30 per cent of computer science students were leaving Canada for work after graduation.
The study's U of T and Brock University researchers found students moved because they felt a big employer would boost their future hiring prospects, their scope of work would be larger and they were promised higher salaries.
U.S. companies relished in their ability to hire Canadian workers, which are known for their artificial intelligence skills, because they helped plug shortages and boost the country's talent ranks.
The layoffs may "keep more Canadians within Canada" because U.S. companies must abide by a different set of payroll, compliance and tax laws, when hiring outside the country they are incorporate in, McNeelands said.
"U.S. companies now have a much larger pool to pick from with layoffs happening, so they might not be looking to go to someone in Canada."
Her assessment comes as Google chief executive Sundar Pichai told staff today that his company would be laying off 12,000 workers.
"Over the past two years we've seen periods of dramatic growth," he said in an open memo announcing the cut.
"To match and fuel that growth, we hired for a different economic reality than the one we face today."
This report by The Canadian Press was first published Jan. 20, 2023.
Why is H5N1, or bird flu, a concern, how does it spread, and is there a vaccine? Here are the answers to some frequently asked questions about avian influenza.
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