Big Tech Hiring Freeze Hits Women and Minorities Harder

US IT Companies Restructuring... High Proportion of Women and Latinx Employees

U.S. IT companies that undertook large-scale hiring during the pandemic boom are now conducting massive layoffs. Although they once employed diverse talents such as women and minorities, concerns are emerging that these groups are becoming the priority targets for layoffs amid the large-scale workforce reductions.

Amazon, Twitter... Are They Laying Off More Women?

Andy Jassy, CEO of Amazon, stated on the Amazon blog on the 4th (local time), "After very difficult discussions, we have decided on a total reduction of 18,000 employees."
[Photo by Reuters]

According to the online tracker 'Layoffs.fyi,' which analyzes job reduction trends in the tech industry, over 150,000 employees were laid off across 993 global tech companies in 2022 alone. In particular, while the tech industry is predominantly male, non-technical sectors such as business development, customer service, and communication marketing have higher proportions of women and minorities. Consequently, non-technical departments that are not directly involved in development are often the targets of layoffs.

The world's largest e-commerce company, Amazon, is set to implement a massive workforce reduction of 18,000 employees on the 18th, far exceeding initial expectations. In November last year, Amazon announced it would begin restructuring focused on its device division, recruitment, and retail sectors. At that time, the layoff scale was expected to be around 10,000, but thousands more are now planned, making it one of the largest recent corporate restructurings among major U.S. companies.

Twitter laid off more than half of its approximately 7,000 employees?3,700 people?immediately after Elon Musk acquired the company in November last year, and hundreds more have left since, leaving the current workforce at about 2,700.

During this process, allegations arose that Twitter deliberately targeted female employees for layoffs first, leading to a class-action lawsuit over discriminatory layoffs against women workers. Female employees claimed that while only 47% of male employees were laid off, 57% of female employees were dismissed, which they argued violated California's anti-discrimination laws. They also added that in the engineering department, 63% of female employees and 48% of male employees were laid off.

The Disappearing 'DEI'

Twitter has been conducting large-scale layoffs since November last year and has become embroiled in a lawsuit related to discriminatory dismissals of female workers.
[Photo by Reuters Yonhap News]

The current harsh wave of layoffs in U.S. IT companies is concentrated on women, Latinx workers, and other minorities. During the COVID-19 pandemic, as demand in the IT sector increased, major U.S. tech companies pursued diversity, equity, and inclusion?commonly known as 'DEI'?in their hiring processes.

However, from mid-2020, the industry became overstaffed, and since last year, the U.S. central bank, the Federal Reserve (Fed), began rapidly raising benchmark interest rates. In this process, tech giants like Amazon have implemented significant layoffs.

Reuters reported, "According to data from a research firm, the surge in layoffs in information and communication technology (ICT) companies last year disproportionately affected women and mid-level talent," citing data from the startup 'Revelio Labs,' which tracks layoffs in the ICT sector. Between September and December last year, 46.64% of those laid off in the tech sector were women, and 11.49% were Latinx. This is higher compared to the overall industrial sectors during the same period, where women accounted for 39.09% and Latinx for 9.96% of layoffs.

It has also been pointed out as a problem that women and minorities face difficulties in finding new jobs after being laid off. Hiwell Carver, co-founder of the developer coaching platform Skiller Whale, said that while quitting is difficult for anyone, job insecurity is a greater burden for women who must consider maternity leave and caregiving responsibilities during job searches.

A study published earlier this year in the MIT Sloan Management Review identified toxic corporate culture as a major factor leading to resignations. The study defined toxic culture as an environment that does not respect DEI, causing employee discomfort, and explained that such a culture predicts resignations at a rate ten times higher than conservative cultures. This means that in toxic cultures, minority employees are more likely to be laid off and find it harder to change jobs.

This content was produced with the assistance of AI translation services.