A plugged-in reader’s comment with respect to the global economy that’s worth elevating:

Just heard a snippet of interesting data from law firm that helps companies with layoffs:

Q408: 1.0M layoffs helped with globally
Q109: 1.5M layoffs
Q209: on pace for 100k so far…

Maybe companies are beginning to figure out what normal looks like moving forward.

Either that or we’re in the eye of the global economic storm. And in layoff news closer to home, it appears as though Yahoo will cut up to another 600.
SocketSite’s San Francisco Listed Housing Update: 4/13/09 [SocketSite]
Yahoo plans to eliminate up to 600 jobs [SFGate]

8 thoughts on “Global Layoffs Leveling Off But Is It The Eye Of The Economic Storm?”
  1. Not sure what to make of this “data”
    Does “on pace for 100k so far” mean that there has been nearly 100k layoffs so far this quarter (there has only been 16 days in Q209). Or does it mean that we’re on pace for 100k total layoffs for the quarter if the layoff rate stays as it has the last 16 days?
    if it is the former, then you’d guestimate 600k layoffs in the Q209 usin this lawfirm’s data… substantially lower than Q109.
    it is possible that we’ll see lower layoffs in Q209 compared to Q109, but unlikely that we’ll see layoffs half. (I think we might see a slight improvement in Q209 layoffs compared to Q1, and maybe Q3 even better if we’re really lucky)
    but thus far the national layoff data has barely budged, and we’re near record highs across the board. and I haven’t seen any fundamental change in the economy that will change that fact.
    Clearly, at some point unemployment will peak… it can’t rise forever. (at least it can’t go higher than 100%). and the govt has shoveled money hand over fist all over the place… which should also help.
    but I just don’t see marked improvement in the jobscape anytime soon. (although I wouldn’t be surprised if unemployment levels).
    the problem:
    the last 2 recessions have been “jobless” recoveries. many like me fear that this will also be a jobless recovery.

  2. To clarify –
    Forecasting 100k layoffs planned for Q2. Companies plan ahead for them, thus giving a bit of forward visibility (e.g., don’t have to wait for returns / close at end of quarter like sales, net inc, etc.)
    No doubt that this isn’t a growth sign – just that companies may be beginning to figure out how to invest / staff / operate in this new environment. Last 6 months of free fall have caused freeze b/c noone wants to invest until they understand what ‘the rules of the game’ are. What can they expect for returns, etc…
    Tough to forecast that in a plummet. If you think you have a feel for what the pace of economy is going to look like, you can plan for that.

  3. Yahoo cutting only 600 (if true) is actually pretty bullish short-term — they could/should cut thousands. I believe a 600-cut does not even take them below mid-2007 staffing levels (and recall they have had layoffs since mid-2007!).
    We have Google reporting in a couple of hours too, so that should be fun.

  4. GOOG revenues are starting to flatten, up 6% YOY and down 3% from Q4 2008. Profits up 9% YOY with headcount decreasing by 58 from Q4 2008.

  5. The big tech companies are not levered, and fat — they have a lot of room to cut, in a pinch.
    Note (as earthly mentions) both google’s topline and net were down a bit q/q (and up only slightly year/year), which I find shocking (but the market won’t). They’ve cut capex (cutting the fat), and this will “pad” their net going forward.
    And all the stock repricing foo happens way down on the cash flow statement (below even free cash flow), so that’s not even mentioned. Awesome! 🙂
    As I’ve said before, the worst thing that will happen to tech is it will be smaller (maybe much smaller), but it’s in no imminent danger — the 70s were awesome for tech!

  6. Most large tech companies can run fine at 50% of their current headcount. Once they become overgrown behemoths then innovation starts to wane; almost inversely proportionate to head count.

  7. Unemployment is always trailing in a downturn. It will continue to worsen even as the economy as a whole starts to balance out in the future. Zooming in on individual companies with unusual profiles like Google and Yahoo seems like a problematic way of understanding the larger picture.

  8. Startups don’t file for layoffs, they just quietly shut down when the money runs out. That will continue to happen outside of the headlines for awhile.

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