The year has not been kind to many sectors, and the tech industry is no exception. The inflation rate is the highest it's been since 1981, which no doubt creates struggles for people, no matter the industry they work in.
Recently, Tesla moved to lay off a relatively large percentage of workers. Elon Musk's decision was calculated and reflects the state of the economy — and implies that there's still worse to come. You should have an idea of the situations that could play out in the coming months in case the rest of the tech industry follows suit.
Why Did Tesla Lay People Off?
Elon Musk personally called for layoffs and a hiring pause, citing that he had a bad feeling about the economy and the downward turn that might be coming. As a result, around 10% of salaried staff would leave Tesla. Company shares fell almost 9% a day later, possibly reflecting what transpired in Tesla's workforce.
This announcement comes shortly after Musk emailed all workers to return to the office or resign, eliminating remote work as an option for Tesla employees. It might work in Musk's favor, as those who have gotten used to working from home may not want to return to the office for various reasons, making it easier to let some employees go.
How the Recession Will Affect Tech Spaces
Tesla is a large company with influence over the tech sphere. Smaller companies will look at its choices as a guideline for what they should do, too. Established businesses and startups alike have relied on Musk's direction before and will continue to do so. Since he feels uncertain about the state of the economy and the turn it might take, other companies are sure to listen and make moves that benefit them.
As a result, tech sectors might see a drop in employment rates. At the same time, companies report that it's becoming increasingly difficult to find people with the right experience and skill set to hire. If you're currently searching for a job in the tech field, this notion could work to your advantage. If you want to stay in your current position, you can do a few things to make yourself look better in your boss's eyes.
How Should You Respond to Economic Downturn?
People who haven't been at the company for long tend to get laid off first. Companies may prioritize longevity over everything else, even if you're a dedicated worker. Still, you can implement a few changes to ensure you look competitive to your employer and on the job market, as well as safeguard yourself for the future before something bad happens.
1. Make Yourself Competitive
The stronger a worker you are, the less likely your boss will be to let you go. Learn a new skill that could pay off well in your field and you could see a change in your workflow or feel more valuable to your team. You might contemplate learning a new language that will help you communicate with an international team, or you could pick up supplemental coding to ensure you can deal with any issues that arise. Continued education can also look competitive on your resume and command a higher salary.
2. Keep Your Options Open
You never know when things might change. Your situation could be different in the blink of an eye, and it's always better to have a resume you can start sending out right away rather than waiting to update it. Even if you feel secure in your job, you can take this time to browse other listings and either apply for them or compare them to your current position.
3. Start Budgeting
Now is the best time to start if your household hasn't made a budget plan. Search for any areas you can cut back on. You should build up your emergency savings to hold several months' worth of expenses, just in case the worst happens and you lose your job. It might not be comfortable, but having enough savings can help keep you or your family afloat if you need to look for another job.
Tech Employment May Change Very Soon
Just because Tesla let go of some employees doesn't mean every tech business will. Your company may look to Tesla for advice on what to do next as the industry moves forward, but that doesn't mean it'll make the same layoffs. Communicate openly with your superiors and strive to be the best worker you can be. The economy’s future might be uncertain, but that doesn't mean your future has to be.