Anytime I see layoffs like this, All I hear is "We hired for the sake of hiring when money was cheap and we wanted to signal 'growth', But now reality has set in and we need our employees to serve a purpose beyond simply headcount".
In my opinion they did these employees a disservice by hiring them in the first place. We need our companies to act more responsibly regardless of the price of capital. Innovate sure, but don't fill up your tank when gas is cheap just to do doughnuts in the parking lot.
This is completely backwards.
They didn't hire "for the sake of hiring" -- they hired specifically to build up their podcasting and audiobook efforts, which were totally new products within the app. Which they thought were essential to staying competitive -- e.g. what if people start moving over to Amazon instead with its Music+Wondery+Audible, or other competitors?
Now it's turned out those bets haven't been as successful as they wanted, so they're keeping them but massively scaling back on future investment. Which means they don't need those employees anymore.
Honestly, what do you expect Spotify to do? Not try to stay competitive, and risk a competitor taking their place, and then go the way of Pandora? Do you think it's wrong to hire teams to build products when you hope the products will succeed but you can't know 100% for sure?
This is just how normal, healthy business goes. You make bets, sometimes they succeed wildly, and sometimes they don't. When they don't, it often results in layoffs because there's not enough profit to keep paying those employees with, and there isn't immediately any new product for them to work on.
Believe me, a company with profit margins as thin as Spotify's can't afford to "hire for the sake of hiring". That's just not how it works.
They placed a bet, and that bet didn't pay off.
But what I'd expect is for them to cut only a little (not 17%), because they would place another bet on something else to remain competitive.
To cut so heavily looks like they've no great idea on the next bet that they could make, that they don't believe those people they hired could contribute towards another thing in the near future (or they have no runway to explore doing so).
Companies should place bets to stay relevant and grow, this looks like there isn't a big bet now.
Interesting way to look at it, a bet. A bet involving people's livelivehoods.
A bet involving paying people a salary for as long as is feasible? Cool!
and destroying their future plans they might have set in motion that will be derailed because of management's incompetance, they don't have money that much money to float on specially in this economy where everything is overpriced, almost like they are humans with their own histories and possibly other people depending on them, did you really try and consider their perspective or was dehumanizing them your first instinct?
but i doubt management will be fired will it? they'll end up with nice fat stacks of bonuses for making terrible business decisions
keep defending the real incompetants though
Believe me, I have very very close experience with what it’s like to go through layoffs, and I feel for those who have just now realized that nothing in this world is guaranteed.
But griping that management should have kept paying salaries when the money wasn’t there won’t get anyone anywhere. Take your severance, hone your skills, apply for jobs. If you can, maybe take some time to go on a trip. Life will go on.
What about when the money is there? Spotify is profitable.
Barely, and only after their previous layoffs this year.
... so the money is there.
And it will be when they rehire later :)
This is a really poor approach to discourse. I imagine you don't really think that every job must last forever. Jobs come and go, and working them means we can live and make choices. It's not fun being laid off (I have been), but it's just life.
People should know that know job is permanent and plan accordingly. Do you really expect to work at one company the rest of your career and get a gold watch and a pension ?
That is entirely correct. But it also implies that employees need to price that uncertainty into their salary demands.
Exactly
You're stating obvious things.
Do they not? American salaries sire much higher than european ones with more job security for example.
It's worth noting that. Sweden, where Spotify is based, still does that whole pension thing, so culturally, relatively, actually yes.
But why shouldn't we expect to be able to work for one company and earn a gold watch (at some anniversary date, I guess?) and a pension?
It used to work that way. Why not now? It worked that way for my grandpa. It looked like it was going to work that way for my dad, until the corporate world did its huge pension rug-pulls. But it could still work that way.
I have a pension now (Sweden). My wife has one (Germany). You could, too.
Giving the employment market another livelihood option was the bet.
Now might not be the best bet making time. Circumstances and the market change.
Revolving loans might cost more to service, which also impacts R&D and product expenditures. It's very dynamic.
Exactly this. And that's just reality. No company has perfect information.
AI clearly is looking interesting and shaping up in a big way for music, but the iron probably isn't hot enough to strike yet.
These are hard problems that leadership constantly grapples with.
This is true, but I personally believe that the loss of knowledge and experience from within is a significant drag on momentum for when you do want to hire again... these people likely won't return even if the markets change, they've been burned, why would they return.
If it's possible to place the next bet, retain as much knowledge and experience as possible, and leverage that towards something new, then surely that is the best thing to do.
Could there have been other bets? Probably, if audio is the definition of the market and what you have at the moment is predominantly Western music, then stronger pushes into native apps for different markets? A classical specific app / flavour? A jazz specific app / flavour? Podcasts are good, but I think audiobooks are better... the audiobook market does not feel "done" at all, there's a lot more that could be done here too. Generational AI dynamic music could be a thing too, not streaming a file but streaming the basis of a constantly generated infinite thing, i.e. study aids, sleep aids, etc. Or how about audio app sync with video devices to enable the audio from your film to come out of your smart speakers or Hi-Fi even without a 5.1 amp?
A lot of these are smaller bets than "podcasts will be worth a gazillion dollars", but each is still significant, sticky, and leads to higher retention, and fights against the commoditization of music playback and the low margins there.
17% cuts does signal a lack of ambition despite "economic headwinds", it feels like a "we need to cut deep" rather than a "what are all the new bets we can make and then we are compelled to cut the difference".
This is what happens during periods of economic uncertainty. It's like counting cards with a freshly shuffled deck: nobody can tell what the state of the game is, so you place a minimum bet until you can get a feel for things again.
The movie is meh, but the boardroom scene in Margin Call has a great line:
"I'm here for one reason and one reason alone. I'm here to guess what the music might do a week, a month, a year from now. That's it. Nothing more. And standing here tonight, I'm afraid that I don't hear - a - thing. Just... silence."
Consumer confidence is down three straight quarters in a row. Nobody feels good about what the music is going to do next.
I recently left Spotify for Apple Music, in large part because of this new development path. I don't want podcasts, audiobooks, etc mixed in with my music. I prefer separate apps.
I think what bothered me more was the focus on branching into these new paths without any innovation in the music department--I'm sure there was innovation that wasn't visible to me. I'm tired of the same black and green color scheme. I don't like that I don't have a 'Library' and everything just goes in liked or a playlist.
I think their expansion into other media was a signal to me to look for someone doing a better job at specializing.
Congrats! Now you get to experience the glory of the deque. Your days of being restricted to stack pushing are in the past.
That (deque) is actually one of my favorite features, and something that had tempted me in the past. I have to relearn some behavior on queue creation though. I'm use to just clicking play, rather than adding to queue, so I end up with a bunch of songs in queue that I didn't intend (because I played a song from a longer playlist to start).
There’s definitely some annoyances… the paramount one for me is actually the opposite of what you describe: I click on an item to simply play it and it makes me deal with a pop up asking me how it should interact with my queue, even when I have no queue at all! Just play the damned song, stop asking me questions.
Ugh… things like this make me wish we had just one FOSS music player with a paid backend. I’d comment out all the modals and get on with life.
Nothing is stopping you from donating to Navidrome development
Same here, plus the constant house ads. It seemed like every time i opened the App I had to close some banner ad for a new feature/record/whatever.
Looking to do this - how did you migrate your playlists? Also my family was using my main Apple Music account - so I have to "clear out the new place" as I setup a family account for them.
Innovate to grow, if growth is the objective. For example, they could better serve the audiophile market with higher quality offerings. Not as much growth there though.
And how does that help them make more money if they still have to always give the record label more money?
How does innovation help them make more money? In the case of higher quality, they can charge more. There are premium services such as TIDAL doing that.
And if they charge more for the relative few people who want it, the record label still gets 70% of the revenue. They have to do something that is not dependent on music licensing.
My point still stands. They chose the path of trying to get market share from incumbents in the podcast and audiobook market rather than trying to innovate in their core music business and that has cost them in multiple ways.
I am honestly looking to move to a competitor because of their podcasting and audiobook efforts. Well, and I don't necessarily care about those things per se but Spotify used to be a focused music app, and they keep removing things from the app in favor of whatever new "growth thing" they want to do this year. I never know when I load up the app what is going to have changed and take me an extra 5 minutes to find what I want.
They have done so much damage to their app's usability by trying to "grow" that someone could probably sell me on some ultra-premium subscription that actually had a good music player that functioned more like the music players of 15 years ago.
FWIW I switched to Apple Music and the player is pretty good, plus the music is lossless.
There’s a lot about the Music app for Mac that makes me wonder how a trillion dollar company can produce such a crappy website (yes it’s a webview, not native), and the iOS app is jittery and buggy in its own way, but in the end I do agree it’s the best option around, and I’ve been a happy-ish paying customer for almost a decade now. (part of that time I had Spotify too)
I think trying to normalize a ~20% workforce reduction as business as usual is a little bit much here.
Management made a lot of mistakes to get to this situation. It wasn't we tried a few things and it didn't work out, it was we burrowed too much money, spent too much money, and risked too much.
What other tech company has cut this deeply recently? You name their competitors, like Amazon and Apple -- is it happening there? 20% is not 2-3%.
Their competitors are not direct comparisons, though, and percentages can be a little misleading. Spotify is ~7.5k employees, and does one thing. Amazon is ~1.5m employees, and does many, many things.
Amazon's layoffs are a percentage of corporate workforce, not their ~1.5 million warehouse + corporate pool.
17% layoffs is healthy? No thanks
So, can at least the execs that made the wrong bets be fired? Those are multi million dollar mistakes. But nope… they just take “complete responsibility” and fire the dev teams.
You're half right. The podcasting and audiobook areas already had layoffs before. This is now layoffs across all areas of the business.
I think that people get really upset about layoffs like they're an example of poor planning, but in reality it's all a calculated risk.
Laying off employees isn't a very negative thing from the perspective of the corporation. Very few costs are associated with laying off employees. A few months of salary, but that's it. It's an at-will arrangement.
I learned in a business class that, mathematically, most companies acutally take too few risks. It's not hart to understand why when you start doing some the math: if you invest $1 million into 10 projects 9/10 of those projects fail but the one successful project makes $10 million, then your investment was broke even. But our brains see a 90% failure rate and want to be more conservative with our investments. Let's say, alternatively, we invest in 5 projects to be more conservative with our money, but because we didn't take enough moonshots we never found a project that paid off, so now we lost $5 million instead of breaking even.
Also, yes, it takes more people to build something than to maintain it. Employees don't like to hear it, but hiring employees that you deliberately plan to lay off in a few years is a completely valid strategy.
If we want this to change then we need to have our governments have better layoff protections in place, like mandatory severance or notice periods. The WARN Act does this but only for large employers making large cuts.
Not spend a fortune on Joe Rogan and then lay off people.
It’s also healthy to get backlash from the public and investors for layoffs. Personally I don’t think it’s ever right to layoff employees for leaderships mistakes. It should be used as a last resort only when the entire company is at risk of going under. Based on their post it doesn’t sound like that’s the case, they even bragged about a “positive earnings report”.
The people who made the decision could bear the brunt of the failed "bet". But I'm willing to wager that the CEO's year-end bonus isn't going to change radically in light of this.
What's the consequence for doing your employees a disservice? Maybe a few of the best and most important employees get jaded and quit. Morale company wide takes a hit. These companies don't seem to care and I guess I'm not sure they should.
For me, it's not just morale that's gone to shit, but I feel like I've woken up to the nature of the employer/employee relationship with all these layoffs. I was blind but now I see, we ARE human resources, and it's very likely none of us are irreplaceable, none of us matter really all that much to our employers and the cost cutting via offshoring/remote employee replacement / no backfill is probably just getting started.
Interestingly, there was a really good article in the NY times yesterday that made that exact point: https://www.nytimes.com/2023/12/03/business/economy/doctors-...
Basically, the article was talking about how being a doctor or pharmacist used to be a very respected profession, and most doctors/pharmacists didn't previously see the need to unionize. With all the consolidation that's gone on in medicine over the past couple decades, though (the article talks about how many of them used to be partners in small doctor groups, that is increasingly rare these days), they now realize they're wage slaves just like the rest of us, and their management has been treating them like interchangeable widgets to squeeze the most productivity out of.
If doctors are unionizing, maybe software developers should rethink their historical aversion to the idea.
Quite a stretch from "This company hired too many people and ended up having to lay off some" and "Hmm, maybe we're not as irreplaceable as we like to think" to "Let's all make ourselves less attractive to our employers by threatening to gang up on them."
But I guess unionization is the universal solvent for every HR problem around here.
How is that a stretch? If we're not irreplaceable then ganging up on our employers is a way for us to reclaim some of the leverage in this transaction that we lose by being replaceable.
it's not even ganging up, it's just hiring a middleman to do your negotiation for you, and they take a cut.
I'm good
Don’t forget all the “oh yeah I’m not allowed to fix that, that’s a CSS bug and I’m a JS Developer. You’ll need to bring in a CSS development team to look at that one”.
You understand that that only happens in unions when the union assents to those divisions, right? You understand that you get to vote about whether your union operates that way?
You understand you’ve removed all personal agency from the worker? They must now do what the thousands of others have decided is best for their job security, not what that individual actually wants to do. My gf used to be a split artist/technical person at her job, she loved it. It got unionized, and now: “Sorry bub, union says you aren’t allowed to make art any more. Keep your head down and script your scripts, we’re getting a real artist for the other parts. Oh yeah and it will be way more work to integrate with them than if you were doing the full stack, but we still want it done in the same amount of time so work late or whatever. Thanks!”
If that's an accurate representation of what happened, that sounds like a shitty union that's insufficiently understanding of the reality that efficiencies improve the bottom line in ways that workers can benefit from, too. Maybe, then, one should engage in that dreaded politics and make it better--because on the flip side, "personal agency" for a worker is just as likely to be "RTO and work late and no raises this year".
Only outliers ever win by atomization--and as somebody with a track record of being an outlier and operating successfully in atomized environments, I'd certainly rather not have my entire technical career be a high-wire act because companies can get away with it!
I do not know what RTO is, but her union is certainly shitty. And your advice of "in addition to taking on the job of training these artists and integrating with their sub-par assets, you should take on the job of a politician too, then you'd see how great unions are!" doesn't really gel. Some people want to just have a conversation with their boss about what work they want, not take up three new jobs because "The Guild" gave them a shitty contract.
That's a bad take. I can understand reasons for not wanting to join a union, but that's a pretty ridiculous assessment of what goes on.
The thing is, all of us like to believe we're special snowflakes and uniquely valuable. What many are realizing is that some of the only real power most of have is if we act collectively. It's not just "a middle man doing the negotiation for you", it's union members acting together, and organizing that way, that gives unions any power at all.
Just look at the recent Hollywood strikes - the only reason they got anywhere is the strong power of their unions (e.g. union members aren't allowed to work for any struck employer, worldwide, while a strike is ongoing). And actors and writers really do have special snowflakes, the big stars that make millions per film, and they're all union members, too.
If Human Resources are just replaceable resources, you don't care about them outside of what they can do for you. If a company is consistently failing to recognize their employees as people who deserve dignity, maybe a collective group is necessary to ensure they start to. This can be government based or be a private union, but companies don't usually make changes beneficial to employees without some kind of outside pressure.
I think that's just a normal process of growing older. Also: yes, of course you are a resource to your employer. An annoying one (stell or laptops don't usually talk back and has demands). I also don't think there's anything wrong with companies behaving this way. By all intents, purposes and employment contracts, it was always meant to be a "work for payment" type deals, nothing more. Of course, ideally your interests and the companies' align beyond that narrow scope; e.g. you're both interested in you becoming an expert in X, or in solving problems in area Y. But it really comes down to you being a resource for the company to produce stuff. Thinking back I realized that my elders and mentors and everyone worth listening to always tries to tell me that (e.g. by telling me "you're not your job", "look out for your WLB, noone else will", "a job is just a means to an end", "HR protects the company, not you", "always keep in mind that you're disposable"...). And yet it seems to be a lesion that everyone needs to rediscover for themselves eventually.
> By all intents, purposes and employment contracts, it was always meant to be a "work for payment" type deals, nothing more
That's exactly the opposite of what 99% of the companies sell to candidates. You must have seen stuff like this is a great place work, join the family, etc. So maybe you mean the hidden intent was that but that's not the message being broadcasted.
Well this is same for 99% products advertised on media. No one really take it at their face value. So why is employment advertising/selling is expected to be factual.
People want to be seduced, it's why you said 99%, some percent of advertising works on all of us, and a major decision like "this is my job and how I spend most of my waking hours on this earth" is ripe for the employee to accept the seduction.
In fact they will try to terminate hires or reject candidates who express primary interest in work being "for payment". Every business looks for an edge, including exploitability checks (and checks against disrupting that line of thought for their other hires)
No company reflects “we’re family” in contracts or compensation packages. That fact alone tells us the message is and always has been bullshit.
The flip side is that these people had a good job for a few years, and can hopefully springboard on. The alternative is that they weren't hired by Spotify, or potentially at all.
As long as they were hired in good faith, and not to just see which people worked out, I don't have a problem.
I think that's the OP's point. They were not hired in good faith and I agree. This mass hiring/firing cycle is playing games with people's lives and, as always, the people at the top are unaffected by it, and in fact maybe rewarded for it. This isn't a game, this is people's lives. It's a little less horrible if it's a remote position but people upend their lives and move for jobs all the time.
I don't think there's any particular malice to the ups and downs - it's just the nature of work these days. Employers and employees have pretty much laid bare their view that the other is simply a cog in their machine. That being true, folks need to understand, plan for, and not be particularly surprised when these ups and downs happen. That means having a runway for lean times, and knowing your worth, how to communicate it, and being flexible when things go pear-shaped. People do move for jobs all the time, yes, but I hope that part of the planning for that involves asking the question - "what happens if this job evaporates?"
I agree. The employees got a lot out of the trade. Money, experience, connections. In addition, anyone participating in the tech economy should be aware of the boom/bust cycles that have plagued its history. It shouldn't be a surprise to anyone that a tech company had a large round of layoffs. The employees should have been aware of the risks when they signed on.
Now, remember this the next time you’re tempted to lose sleep, sacrifice family time or leisure for your employer and then act accordingly.
It's not just that, most of us are knowledge workers, think about how many hours off the clock you spent trying to solve some business problem. Why aren't you enjoying your kid's soccer game and instead thinking about that problem at work? To make your upcoming work day easier, or is it because you're spending many many more hours on the clock actually, working for your employer?
When employers wanted your body, it was a lot easier to have separation between work and home life, but now that employers want your mind, that separation is incredibly illdefined for most of us I think. I used to give that time freely but now I wonder what's the point.
This is very true. I spend a lot of time thinking about work problems. On the one hand it does help me in some ways because those problems are there whether I like it or not and I don't seem to have the control to stop thinking about them. So it does help that sometimes I'll settle on a vague solution in my head before I fall asleep at night, but of course it would be better not to have to do this at all.
I have at times had idle daydreams about doing a job that ends at the end of the work-day and you literally do not have to think about it again. I'd say those sort of jobs are not well paid these days.
But the smart ones know now to be as irreplaceable as possible, however they have to.
Be careful though, my father in law has told stories about people who made themselves irreplaceable by being the only person who can fix a machine because they allegedly fixed it in a way that breaks often enough that they can be the hero. A stain like that on your resume means your burned trust for potentially short term gains and may find trust is not given as easily as a result.
One of the big things I saw when a company I worked at did layoffs was that more people left voluntarily than were fired, especially a lot of the people I saw as the best and brightest. Heck, it's why I left. To me, that's the biggest side affect of the layoffs. There's going to be a brain drain, not because you fired people, but because the morale and mental of the company has shifted.
“The graveyards are full of indispensable men(/women)”
It doesn’t matter how important or irreplaceable you think you might be - life/businesses/people will carry on without you.
Just remember they signed Joe Rogan for over 200 million and he's not brought in nearly that amount for them.
Did they retrench the people who made that decision? Did they retrench the management who approved that contract?
Spotify employees should be pushing for some degree of corporate and fiscal responsibility given they are retrenching, but they still gave Joe the bag.
Unless you are pretty high up at Spotify, you have literally no idea how much Joe Rogan has brought in for them. His podcast has been number one on the platform since it launched.
Personally, I cancelled my Spotify premium family plan over it. I doubt I’m the only one.
I suspect you didn't cancel your subscription because of Joe Rogan being given a deal at Spotify.
I think you cancelled your subscription so you could TELL people you cancelled your subscription as a result of Joe Rogan being given a deal at Spotify.
What people say vs what they do:
https://i.redd.it/kpi0jnr690tb1.png
I guarantee you're not the only one. Do you think Spotify brought on someone like Rogan without considering protest cancellations?
OTOH, the only reason I ever downloaded the Spotify app was because there was an episode of that show that I wanted to listen to, and it wasn't available anywhere else.
Are you missing a "not"? Otherwise you're not making sense.
Thank you!
i feel like this is a pretty hard thing to assess without access to internal metrics
Under What metric do you apply that? What goals did they have for his program?
My understanding was the purpose of buying Joe Rogan was 2 fold, one of course is to bring in new users, but that was not the only goal (maybe not even the primary goal) the other goal was to get more of their current users to have more listen time on podcasts and less on Music, they pay far far far far less for podcasts (in many cases nothing) than they do for Music.
If they were able to shift the total listen time it could have more than paid for Rogan even with out new subscribers
The contract is up for renewal very soon so if they drop him we know he did not meet their objectives. Somehow I bet they renew
How much has he brought in?
The fact that they signed Joe for that amount, and continued to air everything throughout all the controversies, throughout all the COVID years, and through some artist departures over him, signals that he has more than recouped that investment for them.
https://www.newsweek.com/joe-rogan-more-popular-ever-statist...
They also signed a deal with Meghan Markle and Prince Harry that was worth 20 million. They agreed to part ways in June. I'm guessing the reason was that it failed to deliver financially. See:
https://archive.is/Hgh3V
And they were still hiring too! My first day was last Monday haha, last day today
Hope they gave you a fat severance package
That's so messed up when companies do that. Curious what your separation package was?
Wait, you were hired and laid off in the same week? I'm really sorry that happened to you. The fact that that was allowed to happen suggests a very dysfunctional and incompetent management culture.
What team. What role.
I struggle to understand comments like this one. Spotify were being responsible at the time. Their employees are not 30-year mortgages, they are volunteer employees given no promise of continued employment.
Through a few degrees of separation it all boils down to "we could do X when prime interest rates were 3%, and now they are 8% we can only afford Y"
Another strong contender for humanity's future epitaph.
Remember hindsight is 20/20. If capitalists were as risk-averse as some would like, we'd be stuck in the past forever
I get annoyed with comments like yours that reach for absolutisms to try and make a point. No, we wouldn't be stuck in the past "forever". We may just move more slowly into the future than you would prefer.
Given our historic inability to predict the long-term externalities of present-day technologies, I'd say a more cautious approach is warranted compared to the current YOLO strategy.
The only way the human race becomes stuck in the past forever is if it goes extinct.
You say this like it's self-evident it's a bad thing, but it's not, even if I'm a middle-class white guy in 1975, let alone an Oneida in 1475.
I wholeheartedly agree. It's about time governments started signalling to employers that this sort of behaviour will not go unpunished. After all, it's the state that will have to pick up the tab for the rampant over-hiring in the form of social security and healthcare.
What should the punishment be? Fines for layoffs?
Sure. There are all kinds of things that could be done to increase their consideration of moves like this and simultaneously benefit the people affected.
E.g., rather than considering only percentages of unemployed/employed to set rates for Unemployment Insurance, they could also add a "capriciousness" factor for events like this. Or, they could also require funds be provided for continuing education for those laid off. Heck, they could also just make a basic adjustment for the inherent bias in the Unemployment Insurance rates against small biz, where a single layoff/firing has a huge negative effect on your rates, more than firing 100 people for a medium-sized company.
But of course, for the "libertarians", this is evil regulation.
Your comment was pretty good, but didn't need the weird potshot at libertarians at the end.
What your comment touched on though is how the companies already are "punished" in a way for it because it affects their unemployment insurance rates. That was established as a way to balance the needs of the company (unintended bad consequences happen to unemployment rates when you tie the hands of firing) with the needs of the people who are affected. Arguing that the balance is off seems like a much different argument than GP though.
Who is "they"? Spotify executives who assumed the money printer would never run out of ink? The managers who hired and hired to expand their own empire? The software engineers who engaged in "resume driven development" by stacking abstractions on top of abstractions so they could play with cool new tech at work?
There is a lot of opportunism out there.
Top blame is on middle-management (100+ reports), because they set the rules-in-practice for how the organization actually operates, and second blame goes to top management (C-level), because their job is to keep the middle-management in check.
The line employees are just responding to the incentives that these two groups create, they aren't the ones steering the ship into the ground.
Any significant layoff that doesn't have a disproportionate number of people from those two groups thrown overboard is ass-covering. They are the ones who screwed up.
In what I've seen, this generally comes from top management, the board even in some cases. They set the agenda and approve budgets for everything the company does. Head count is a direct translation of this. In normal scenarios, head count becomes the bottleneck and limits how many things can be taken up for a given year. But during the pandemic, dollars became plenty and execs reached deeper into their wish list and triggered a hiring frenzy. Middle management rarely has a say in these matters. They only need to come up with plans that can ultimately fulfill management's agenda.
They do, but they are often blind, due to fog of war, of what actually happens in their firm.
Middle management controls that - by deciding on what kind of line-work (which they have visibility over) gets rewarded or prioritized. If the line engineers are spinning their wheels, doing architecture-astonaut nonsense for the sake of promotion, that's not because the CTO is rewarding it - it's because their 100-person director (who should at least vaguely know what each of their reports is doing this year) is.
These people got a high(er)? paying job during the period, have a well known company on their resume, and are being let go during a layoff such that no blame is assigned to their exit. What’s not to like?
If they knew that was what they were getting into, great.
On the other hand, if I hire a guy, he quits a secure job, he moves his family all the way across the country, and then 3 months later I fire him because I changed my mind about what I need? That guy is absolutely not going to thank me.
Yes, it depends on those factors. One other factor is what would have happened at his old job. I have a friend who went from one big tech company to another was then laid off recently. There's a good chance the result would have been the same either way, since the first company cut a lot as well.
One factor that keeps people at a company is the knowledge that, all things equal, last hired is first fired. It's not hard and fast, but you tend to have fewer allies at a company you just joined, making you more susceptible. When someone decides to leave one company and join a new one, they know that they're giving up this advantage.
In a healthy company, I would expect every employee to contribute to the bottom line, either directly or indirectly. They hired these people because they needed them to do a job, a job that somehow helps making the company money.
As such, unless there are sudden significant changes to the market and product (which as far as I can tell is not the case here), firing employees should result in lower revenues. After all, employees generate more money than they cost, that's the entire point of employees.
This leaves me with a bunch of questions when I read things like this:
1) If the company can get by without these people, what were they doing in the first place? 2) If these people did not contribute to the bottom line (directly or indirectly) what was the point in hiring them? 3) If they did contribute, why let them go?
I've been a spotify subscriber for over a decade. Every single update has made the windows version worse at least. They've rebuilt and redesigned it repeatedly, for whose benefit I don't know. Obviously that is just the app side part of the whole org.
The 2011 app with blatant iframes partitioning the sections of the app was peak Spotify Desktop, imo
I keep reading this.
I don’t know how much Spotify pays or if it pays above market. But I much rather have a high paying job - especially if it doesn’t require relocation and then get laid off than not have a high paying role at all.
A job is not a marriage, it’s more like a a semi serious dating relationship. I’ve had 9 jobs in 27 years and 7 since 2008.
A job is merely a method to exchange labor for money to support my addiction to food and shelter.
Once either me or the company decide it isn’t on our best interest to continue the transactional relationship, we break up and I change my relationship status to “open for work” and put myself back out there.
Amazon was my 8th job. I knew from reputation and 2nd hand experience, that eventually Amazon was going to Amazon.
https://news.ycombinator.com/item?id=38474212
And I planned accordingly from day 1.
https://news.ycombinator.com/item?id=37969302
Nine serious relationships in 27 years, but no marriage? I bet you live in one of those heathen countries where sex before marriage is legal, don't you? If you weren't allowed to have sex before marriage, would you still be unmarried after 27 years of relationships? Sweden, where Spotify is headquartered, is 8,600 kilometers from the San Francisco VC-backed tech scene, and is just as culturally removed from it as well.
You can't have your cake and eat it too. There are plenty of other lower risk companies that have way lower chances of layoffs, but they don't pay as well. Working at a company that tasks risks and has a high rate of return also has a higher chance of making the wrong bet and needing to cut you. If you want a perfectly stable job go work in the government: you'll be practically unfirable.
- someone who was layed off from a FAANG corp. I was not done a disservice, I knew what I was getting into.
Or the public sector. Anyone who thought a money-losing company like Spotify was a safe ship to jump on board didn't think things through.
I read it more like "we hired when money was cheap and were hoping that we could create some new revenue streams but that didn't work out and now we don't have much hope of revenue growth in these areas so we have to reduce costs."
That is how it should be read, because this is how these companies operate. My company's CFO was talking about this as we pushed for profitability (since the market expectations changed) and rationale for investment was exactly like you said.
"It's our job to grow, profitably, so if we think we can generate more than what we spend, we can invest. But if its not working, we will cut it."
Unless you have a specific reason to believe it to be otherwise.
Put a cost to unwanted behavior and make people think twice with siding with Moloch
? If you are hired by a architect and a company is downsizing, its actually a recommendation. Your software works- it needs less people for maintenance then for growth. And at a company thats stagnating and going into survival mode- your skills will not be needed except for the last ditch pivots (which will be a architectural mess). Once more from the the top - to be let go in a software role from such a company, is a recommendation.
Why, though? Investors are paying for doughnuts and smoke, and many tech companies are really in the drift racing business, not in "commute rationally" business.
The reality is, current economy has much less demand for this kind of a road show, but all their hiring was totally rational.
Thats a nice ideal, but its not something that the companies are made to consider seriously. To them, cheap capital signals an opportunity to juice up their growth numbers, and expensive capital signals an opportunity to cut problematic employees from the team (and keep others on their toes).
Until there are real consequences these companies will not change.
Of course you should!
Of course you shouldn't!
Did Spotify do that?
There is still no crystal ball. You take the opportunities as they are presented, especially given that your competitors are doing the same. Where exactly was your commentary on Spotify's business when times were better, urging them to leave more people without jobs?
Hot take: it's a life skill to look at a company beyond the salary they offer you and get at least a basic sense of whether they are over staffed, well managed, offering a valuable service, and not in a dying industry - or at least be sure your role there is doing something high value to the critical service provided. Too many employees IME are just too comfortable with ignorance about their employer outside of their team and the other teams they work with directly.
I remember comments clamoring how great Spotify was going to be because of their European roots compared to Apple (Music) a U.S. company.
But that's the whole point of modern day life. Any benefit we have gotten we never looked critically what was the cost. It is only at discomfort and disruption we gain this great self-awareness of the world.
They did disservice in same sense if we consider giving job in people is some service to employees.
You're kinder than I am, ascribing an actual staffing problem to their layoffs. All I see and hear these days is, "We want to bump up our share prices, and it's easiest to just lay off some people."
It’s hard to know what’s “responsible” when you’re operating a business at a loss in the hopes of becoming profitable eventually and then it just keeps going for years and years without making money.
A business by definition is not a valuable and transferrable business if every single person (including the C-suite) cannot be replaced without the business collapsing.
No one is immune to this or an exception. Top to bottom.
On the other hand, 17% of headcount had a job during that time. Which one is better?
If we put ourselves back into the shoes of 2019-2020 there were people who were talking about a post-capital world because money was so cheap.
I'm not defending all the companies that hired quickly - but if you all recall it did seem like the world had changed significantly with way more use of technology. I believe the underlying bet was once everyone uses these tools people will inevitably keep using them. Coupled that with cheap money (for the past decade) and incredibly fast growth and no-one thinking that the rates were going to go up at least not in the near future.
I find it hard to act so certain and so clearsighted that companies were acting in bad faith as you seem to point to.