It was bound to happen. After over a decade of growth, drastic market shifts have brought the tech industry to a slowdown. Time is yet to tell the severity of the situation, and in the meantime, companies are deploying a variety of preemptive risk management tactics to increase efficiency, limit spending, and prolong their runway.
In a survey conducted by Compete in July 2022, HR leaders were asked the following question: “Given the ability to make data-driven decisions, which course of action would you advise to take if reducing expenses is a must?”. Over 50% chose reducing employee welfare benefits. Layoffs came in second, amounting 22.2% of responses, then mandatory furloughs at 19.4%, and finally pay cuts was chosen by just 8%.
The tech industry contains a wide diversity of companies in various categories, maturity stages, and levels of resilience. It is clear that there are many additional parameters and options to consider and that the relevancy of the options provided in the survey may vary between organizations and not necessarily apply to some.
Let’s briefly examine the two more extreme measures of the options given.