Silicon Valley has been attracting a lot of press since the beginning of 2023, but the copious news coverage is not exclusively related to technological innovations with conversational AI (artificial intelligence). The media has also been reporting on the numerous “Big Tech” companies based in the United States that have been laying off employees by the hundreds—and thousands in roughly a dozen cases. According to Layoffs. fyi, more than 128,000 tech employees had been let go in the first quarter alone. And these dismissals come after approximately 161,400 jobs were cut by tech firms in 2022. Some of the most substantial tech-related layoffs were reported for several renowned companies, including Google, Amazon, Meta (Facebook), Microsoft, Yahoo, Zoom, Twitter, Dell, IBM, PayPal, Salesforce, and Spotify. Layoffs have been occurring at smaller tech companies as well.
“My view is that we’re still just seeing the beginning of it,” says Chuck Gordon, CEO of Storable.
The Pink Slip List
As posted on March 20 on TechCrunch, the following “Big Tech” companies have laid off or announced planned layoffs:
• Alphabet (Google’s parent company) laid off 12,000 employees by email—the largest cut in its history. • Amazon will lay off an additional 9,000 employees after eliminating 18,000 roles and ending AmazonSmile. • Dell is laying off 6,650 employees. • IBM reported approximately 3,900 job losses. • Indeed.com has laid off 2,200 employees. • Meta will be cutting 10,000 employees from its workforce and eliminating 5,000 unfilled positions. • Microsoft plans to lay off 10,000 employees. • PayPal has cut about 2,000 employees. • Salesforce plans to lay off around 8,000 employees. • Spotify has laid off approximately 600 employees. • Twitter has laid off more than 200 employees. Its staff has decreased by more than 70 percent since Elon Musk took over. • Yahoo is laying off 1,600 employees in its ad tech business. • Zoom has cut 1,300 employees.
The reasons for the mass layoffs vary. While some companies are eliminating redundancies, others are trimming their budgets by reducing operating expenses, creating efficiencies, adapting to a changing economy, and/or preparing for a potential recession later this year. Along those lines, in an article posted on ET Now Digital on March 20, Nitesh Banga, the president and CEO of GlobalLogic, a digital product engineering company, speculated that the tech layoffs in the United States will generate more opportunities for workers in India, where IT professionals are plentiful and tech-related labor is less expensive. Half of GlobalLogic’s workforce (about 15,000 employees) is from India’s IT sector.
Unfortunately for those who’ve found themselves unemployed, it seems as though these bulk firings were inevitable. Robert Chiti, CEO of Phoenix-based OpenTech Alliance, Inc., states that many of these high-profile tech companies led the “over hiring, overpaying craziness during the pandemic.” He goes on to say that “this purging of excessive labor you are seeing now is to be expected.”
Gordon expands upon that notion, comparing the downsizings to “the fundamental trends we are seeing in self-storage itself, which is a normalization to pre-pandemic levels for occupancy and pricing. It turns out that tech companies are going to keep growing like they were before they had massive spikes in demand and valuations due to COVID, and they are having to adjust their workforces to accommodate this new reality.”
According to Ramey Jackson, CEO of Janus International, some of those businesses may be pursuing new paths as well. “In some cases, you saw technology companies’ layoff entire teams and divisions in order to go in another, more profitable direction,” he says. Besides laying off considerable percentages of their workforces, and entire departments in a few instances, these tech companies may be reevaluating their benefits packages and abolishing some of their most costly employee perks to further reduce expenses.
As a matter of fact, Google, which had long been revered for its enticing incentives and employee-centric culture, has already deferred a portion of its employees’ January bonuses to be paid later in the year and dismissed a few employees while they were off for previously approved medical and maternity leaves. Also inconsistent with its formerly celebrated culture was Google’s pink-slip process—all 12,000 of Google’s recently relieved employees were terminated via email. A corporate email also blamed the current economic reality for its decision to lay off so many veteran Googlers, many of whom may have had heftier salaries than the greener staff members retained by the company.
The Impact On Self-Storage Although these mass layoffs may cause end-users to question whether they should seek products and services from other tech companies that aren’t downsizing their workforces, Chiti believes that their labor reductions won’t impede their productivity. “The layoffs, while seem like big numbers, will not impact the services self-storage operators receive from these vendors,” he says.
On the other hand, as Jackson notes, “There is always the possibility that products and services can decline or become less stable or reliable when mass layoffs occur. If a tech company lays off a significant portion of their customer support or account management team, ‘help desks’ and customer service response times can certainly suffer,” he says, adding that self-storage operators could select self-storage-specific solutions for their operations instead.
“When working with the ‘tech giants,’ it’s important to understand if those companies understand your business needs and what level of support they intend to provide (via SLAs in your contract with them),” says Jackson. “Large companies can change direction quickly, so it’s important to understand what protections you have in those events. For smaller companies or startups, it’s important to understand how financially viable they are. If you leverage technology from a startup or small company, and that company ends up going under or selling, there can be serious ramifications for your business.”
Steve Reeder, director of marketing for PTI Security Systems, agrees. “… it is often wise to make sure the company has staying power to weather this and future storms,” he says. “Operators want to make sure that support will be available for their purchases five, 10, or 15 years from now. Younger, upstart companies may find it more difficult to be in an advantageous financial position or may not have the product portfolio needed to help soften the blow a retracting economy may offer.”
As for customer service, Shannon Charbonneau, vice president of client solutions for Richardson, Texas-based XPS Solutions, is hopeful that the layoffs won’t adversely impact tech support. “In my experience, it was already pretty difficult to get a live person for support with Google or Facebook,” she says. “Having fewer people doesn’t seem like it would help that! However, with the growing use of AI, maybe this is the natural next step. This is a matter of high tech vs. high touch. And while I can see that we’re swinging far toward the high-tech side, I truly believe there will always be a place for high touch as well.”
Beyond products and services, two obvious ways the layoffs could affect the self-storage industry include additional demand for storage and new talent to fill job openings.
Indeed, dislocation from job loss has always been a demand driver for self-storage. “… anything that causes uncertainty in the job market actually trickles into the housing market,” says Charbonneau. “These mass layoffs will likely result in people moving for work, or downsizing, or renting rather than buying, etc. All of these types of changes seem to include a need for storage, even if just in the interim.”
Reeder concurs, saying, “People always need storage, during bull markets and bear markets.”
As for experienced tech talent, it’s no longer in short supply. “There will be more people looking for jobs, making it easier for smaller tech companies in the self-storage industry to hire more staff,” says Chiti, whose company was able to hire three technical employees within two weeks in March. “We are growing like a weed, and the biggest thing holding us back was our ability to find qualified candidates to join OpenTech. With these layoffs, we have people knocking on our door.”
Fire Or Hire? So far, the mass tech layoffs of Silicon Valley haven’t negatively impacted self-storage, and none of the industry’s tech companies have reported any layoffs. However, the industry professionals interviewed for this article are split as to whether self-storage could follow suit.
“… I would be surprised to see large scale layoffs simply because the industry has already proven that it is resilient to economic pressures,” says Reeder. “COVID taught us all that.”
“We certainly don’t expect to see any layoffs on our technology side of the business,” says Jackson. “Our Nokē team continues to grow as we bring new smart security solutions to the market and as storage owner-operators continue to rapidly adopt our products. It’s difficult to project what may happen with other technology companies in the industry, but we feel confident that our technology team will continue to grow.”
Of course, there’s no guarantee that everyone will come out of these dismissal days completely unscathed. “Values of companies that went public using a SPAC have been failing all over,” says Chiti, “so I would not be surprised to hear that happen in our market as well.”
Charbonneau has similar workforce concerns that stem from market consolidation. “With our ‘big guys’ like Life Storage, Extra Space, and Public Storage trying to buy each other out, there are possibilities of layoffs in corporate functions if there is consolidation there,” she says. “There have also been vendors in the self-storage industry who have consolidated in recent years under a single banner, and that has resulted in some personnel changes. The difference is that Google is talking about many more people than we would ever be talking about in this industry.”
At the moment, at least one thing is certain: The labor pool is overflowing with qualified candidates, so it may be the perfect time for self-storage companies to publish their unfilled positions on job sites that attract top tech talent and/or consider creating new roles to support their growing operations.
“As an operator, maybe you’re considering bringing your website in house, or hiring a software developer to build custom workflows on top of your Facility Management Software platform using an API,” adds Gordon. “The people who can do that are going to be more readily available and potentially interested in trying something different than big tech.”
Attract Tech Talent While general job websites like Indeed and LinkedIn are still suitable for tech-related job listings, you may have more success reaching tech talent by posting your job openings on one or more of the tech-specific job websites listed below.
• Dice.com • Hired.com • Built In • Angel.co • The Ladders • Crunch Board • Remote Tech Jobs • Triple Byte • Mashable Jobs • IT Job Pro • White Truffle • F6s.com • Authentic Jobs • Tech Careers • Smashing Magazine Job Board • Underdog • Tech Fetch
Erica Shatzer is the editor of Mini-Storage Messenger, Self-Storage Now!, Self-Storage Canada, and Mini-Storage Messenger’s annual Self-Storage Almanac.