“It is not yet clear how the global job cuts will impact the company’s Irish-based workforce.”
It is a line I have written and spoken on numerous occasions in recent months.
The layoff announcements follow a familiar pattern.
A CEO in Silicon Valley will send a memo to employees. They will apologise for getting it wrong, for over-hiring during the pandemic and for being overly optimistic about the economic outlook.
They will talk about ‘tough decisions’, ‘difficult choices’, and the need to build resilience for the future, they then announce the cuts.
Typically, the global headcount reductions at tech companies have been in the region of 5% – 10% and given the scale of some of these tech giants this equates to tens of thousands of jobs.
Because so many of those firms have large bases here, the announcements have led to nervous times for thousands of Irish-based employees.
The percentages
Thankfully, in many cases, the percentage cuts announced by companies have not been fully applied in Ireland.
For example, in January Microsoft announced plans to cut 10,000 jobs globally, around 5% of its total headcount.
If that percentage were to be applied to its Irish-based workforce of 3,500 it would mean 175 layoffs. Instead, on Thursday, staff in Ireland were told there would be 120 job cuts here.
Last month, Amazon announced 18,000 job cuts globally and although it is a very large employer in Ireland with around 5,000 Irish-based staff, the layoffs here are expected to be between 50 and 70.
In some tech companies, the global percentage cuts have been applied in Ireland.
Earlier this month it was confirmed that a 10% cut to overall headcount at Salesforce would result in around 200 redundancies among its 2,100 strong Irish-based workforce.
In November, when Meta announced a 13% global cut, it was initially thought it would be applied to its Irish-base workforce of 3,000 people which would result in around 390 redundancies.
That number was reduced to 350 and it is understood the figure is now closer to 300.
Regional breakdowns are not yet available for many of the more recent layoff announcements but so far Ireland appears to be escaping the full scale of the tech cuts.
A lot of this is down to the kinds of roles that are based here.
Irish-based roles
“Technologists in areas like AI, cybersecurity or data analytics have really valuable skills,” said Una Fitzpatrick who is the Director of Technology Ireland, the Ibec group that represents the technology industry.
“I’m sure some companies have made a decision to try to hold on to and retain those key talents, so I think from an Irish perspective we have strengths in terms of the depth and strength of the talent that is here and maybe companies are trying to retain as much of that top tech talent as possible.
“While any job losses are very concerning and deeply upsetting for the people impacted, I think on the whole the numbers in Ireland haven’t been as large as the global headline figure,” Ms Fitzpatrick said.
Elaine Burke is a technology journalist and host of the ‘For Tech Sake’ podcast. She agrees that Ireland has avoided the worst of the tech cuts so far due to the skillset based here.
“When it comes to the likes of Meta, Google and Microsoft, it doesn’t look like there is going to be decimation in Ireland because they have their EMEA bases here with a lot of big roles, so I think that is probably why we have lucked out so far,” Ms Burke said.
But are there opportunities for those who do lose their jobs in tech?
Una Fitzpatrick of Technology Ireland says that SMEs or bigger indigenous tech companies, who may have struggled to hire in the past, are now finding it easier to source good talent.
“The advantage for Ireland is the presence of such a strong indigenous sector so there are opportunities for people who worked in another tech company to then go and work for an indigenous tech company,” Ms Fitzpatrick said.
“We’re also seeing redundancies on the recruitment side or in business development and I suppose those kinds of roles are ubiquitous with demand from other sectors like MedTech, pharma or financial services.
“Obviously we are trying to keep our best people so it’s up to the tech companies to ensure we do hold on to as much of the talent as possible,” Ms Fitzpatrick added.
Are we over the worst of it?
On Friday, the Minister for Enterprise, Trade and Employment Simon Coveney said he believes Ireland is “over the worst” of the tech job cuts.
“I certainly think we’re over the worst in terms of announcements, but of course some of the global announcements have yet to be translated into announcements here in Ireland,” Mr Coveney said.
He is just back from a visit to the US West Coast where he met with executives from tech companies with bases here.
“We travelled to meet the key decision makers in tech companies for a reason. The message that they were giving me very directly is that Ireland is a place where they plan to grow and invest more in the future – not less – despite this temporary correction that is necessary,” he added.
The Labour Party criticised Mr Coveney’s assessment that the worst may be over.
“The Minister has incredibly said that the worst is over in terms of job cuts, however we are yet to be told of the full scale of job losses in many companies,” said Labour’s workers’ rights spokesperson Senator Marie Sherlock.
“There is a real concern here in terms of job losses in the tech sector and what it means for tech workers, but my greater concern is what impact these job cuts will have on companies that depend on the tech firms themselves,” Ms Sherlock said.
Are more tech job cuts on the way?
While some may think the worst is over, others are more cautious.
“I think it’s too early to say but hopefully we are getting through the worst of it,” said Una Fitzpatrick of Technology Ireland.
“The next six months will be critical and there are a lot of external factors that are at play here.”
“There is shareholder reaction to the cuts and whether or not they feel that it’s enough. There’s also what’s going to happen with inflation.
“We are seeing some tentative signs that inflation might be stabilising, and I think that would be really important for the tech sector as it would give confidence to draw a line under this difficult period and move on into a new growth phase,” Ms Fitzpatrick said.
Technology journalist Elaine Burke fears more bad news could be on the way.
“I do think we are going probably see more announcements coming into the summertime, you might even see second rounds of job losses from some companies, depending on their next quarterly figures,” Ms Burke said.
“I think a lot of tech companies are playing a very conservative game at the moment, looking at the wider economic outlook, which still looks uncertain.
“But there are still big areas of investment like AI, that’s what these companies are making bets on – the things that they think are going to drive them in the long term,” she added.
Tech workers here are no doubt hoping that those long-term bets pay off and that the dreaded ‘we got things wrong’ emails from CEOs will be a thing of the past.
