Tech Layoffs 2025: IT Layoffs Meaning, Reason, Labour Law & More

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Are you feeling uncertain about your job in the tech industry? With over 136,782 tech layoffs in 2025 alone – many workers are facing tough times. 

Understanding what layoffs mean and why they happen is important for anyone affected. 

In this blog, we’ll discuss the reasons behind IT job cuts, the labour laws that protect workers, and what you can do to manage this challenging situation. 

This guide will help you make sense of the current situation.

What is Layoff?

Let’s start with company layoffs meaning. 

A layoff happens when a company reduces its workforce to save money or adjust to lower demand for its products or services. It’s not the same as being fired for poor performance; layoffs often occur because the company is facing financial challenges or restructuring. 

Employees who are laid off may receive severance pay or unemployment benefits, depending on the situation and local labour laws. While layoffs can be temporary – they can also lead to permanent job loss. This process impacts both employees and the company – causing uncertainty for those affected.

What Do Tech Layoffs Mean?

Tech layoffs refer to companies in the technology sector reducing their workforce due to various reasons like – 

• Economic downturns
• Changes in business strategies
• Slowing demand for products and services

Layoff in tech isn’t always a reflection of the workers’ performance but is often tied to a company’s financial challenges or the need to cut costs. Many tech giants, as well as startups, may undergo job cuts to stay competitive or shift focus. 

Unfortunately, tech companies lay offs impact thousands of employees – leading to job loss and uncertainty about the future – especially in a rapidly changing industry.

The Reasons Behind IT Layoffs 

Are you wondering why layoffs are happening in the IT industry? Well, here are the key reasons behind job cuts in the tech sector. 

1. Economic Slowdowns

Fears of a recession and economic instability are key drivers of layoffs in the IT sector. During periods of economic uncertainty – businesses often take measures to reduce costs, and cutting staff is a common approach. Tech companies, facing reduced revenue and profits – often turn to layoffs as a cost-saving strategy during these tough times.

2. Impact of Artificial Intelligence (AI)

AI is reshaping the tech job market, with companies prioritizing hiring employees with AI-related skills. However, for roles that can be automated, the risk of layoffs increases. It’s estimated that 10% of U.S. jobs could be disrupted by AI. Also, with more than 8,000 layoffs in India’s tech industry, companies like Paytm and Unacademy are focusing on reducing costs and using AI. 

While AI boosts productivity in some areas, it also leads to downsizing in positions that become redundant. Companies like IBM have already announced job reductions as they transition certain tasks to AI.

3. Rising Inflation

Inflation has led to increased costs for businesses, forcing many to evaluate their operations. For tech companies that rely on advertising revenue – inflation has reduced spending by advertisers, impacting overall profits. To counterbalance rising costs, companies have had to reduce their workforce, contributing to the spike in IT layoffs.

4. Interest Rate Hikes

With the Federal Reserve raising interest rates – borrowing has become more expensive for companies – leading to reduced investment in growth and innovation. This has particularly affected startups which rely on venture capital funding. As investors become more cautious – tech firms face reduced funding, forcing them to scale back their operations, often by cutting jobs.

5. Pandemic Overstaffing

During the pandemic, tech companies hired aggressively to meet the rising demand for digital services. As more people worked, shopped, and socialized online, companies expanded their teams to keep up. However, with the return to more normal patterns of behaviour, many tech firms now find themselves overstaffed. As a result, layoffs have become a necessary correction after the pandemic hiring surge.

6. Investor Expectations

Investors expect companies to maintain profitability even when revenue growth slows. This pressure has led many tech firms to cut costs by reducing their headcount. Companies like Meta and Alphabet have faced demands from investors to improve efficiency – resulting in significant layoffs. As profit expectations remain high – layoffs are often seen as a necessary step to meet financial goals.

7. Post-Pandemic Adjustments

As people return to in-person activities – the demand for certain tech services has decreased. Many employees hired during the pandemic for remote work and digital solutions are no longer needed. Tech companies are now trimming down their workforce to adjust to lower demand – leading to layoffs in roles that were essential during the pandemic but are no longer as critical.

8. Silicon Valley Bank Crisis

The collapse of Silicon Valley Bank in 2023 had a ripple effect on the tech industry – particularly for startups. SVB was a key lender to tech startups, and its collapse has made it harder for these companies to secure funding. As a result, many startups are facing financial difficulties – leading to job cuts as they try to stay afloat.

9. Industry Maturity

The tech sector has grown rapidly over the past few decades, but it is now reaching a more stable phase. Many companies have already captured a large portion of their target markets – leading to slower growth. With fewer opportunities for expansion, tech firms are focusing on efficiency and profitability – which often includes reducing staff.

Recent Layoffs in the IT Sector (2024)

We are going to cover the latest layoffs in the tech sector over the past three months. Did you know? In just these months – more than 40,000 employees were laid off.

September Layoff 2024

Company	Layoffs	Reason/Details
Qualcomm	226 employees	Post-previous layoffs of 1,250 workers; cost-cutting measures.
Amperity	13% workforce	Follows earlier layoffs of 20 employees in 2023.
Cisco	5,600 employees (7% of workforce)	Further cost-cutting after an earlier round of 4,000 layoffs.
Udemy	280 employees	Restructuring; half may be rehired, especially in lower-cost markets.
Microsoft	650 employees	Focused on gaming division; follows 1,900 job cuts earlier this year.
Goop	18% of 216-person staff	Refocusing on beauty and food brands, deprioritizing other areas.
Fly.io	40 employees	Part of a company restructuring.

August Layoff 2024

Company	Layoffs	Reason/Details
Character.AI	5% of workforce	Cuts in marketing and recruiting departments.
Brave	27 employees (14% of staff)	Affected multiple departments in the browser and search startup.
Apple	100 employees	Job cuts in its digital services group, affecting Books and News teams.
Scale AI	1,000 remote contract workers	Not categorized as layoffs, no impact on full-time staff.
Inuitive	20% of workforce (80 employees)	CEO stepped down, part of cost-saving efforts.
Cisco	Thousands	Additional layoffs after 4,000 jobs cut earlier in 2024.
READY Robotics	Full shutdown	Company stopped operations, auctioning off equipment.
Dell	Unknown	Company aiming to streamline and focus on AI services.
Intel	15,000 employees (15% of staff)	Significant layoffs due to underperforming revenue growth.

July Layoff 2024

Company	Layoffs	Reason/Details
Intuit	1,800 employees (10% of workforce)	More than half cut due to performance; plans to rehire.
Match Group	6% of workforce	Focus shift from livestreaming services to generative AI across its apps.
Webflow	8% of workforce	Restructuring for the company’s next phase of growth.
Aqua	50 employees (10% of workforce)	Despite becoming a unicorn, facing workforce reduction due to challenges.
Salesforce	300 employees	Cost-cutting measures to streamline operations.
UKG	2,200 employees (14% of workforce)	Redirection of resources into key product innovation areas.
EverC	10% of workforce	Cybersecurity company dealing with industry challenges.
Unacademy	250 employees	Series of job cuts after in-person school sessions resumed in India.

Labour Law Regarding IT Layoffs

In India, the Industrial Disputes Act of 1947 (IDA) deals with layoffs – but it doesn’t cover IT workers. The tech industry in India is primarily governed by individual employment contracts. 

Here’s an overview of the legal framework that applies to layoff in tech:

What Is Layoff in Labour Law?

Under the Industrial Disputes Act, 1997 – Section 2 (kkk) – a layoff is defined as a situation where an employer cannot provide work to employees due to various factors. Importantly, layoffs are temporary measures, distinct from retrenchments, which signify permanent job loss.

Conditions for Implementing Layoffs 

Before laying off workers, employers must meet certain rules under the Industrial Disputes Act:

• Employers must show they can’t provide work due to various challenges.
• Only employees listed on the company’s roll are eligible for layoffs.
• Layoffs should be temporary, not permanent job cuts.
• Layoffs should result from issues like shortages of power, machinery, or natural disasters.

Industrial Disputes Act (IDA) and IT Layoffs

The IDA explains what a layoff is, but it mainly applies to workers in industries like manufacturing or construction. It doesn’t apply to IT employees or those in managerial or supervisory roles.

The law focuses on “workmen,” which refers to employees who perform manual or technical work. Most IT workers and higher-level employees are not included under this definition, so they can’t use the IDA for legal protection when facing layoffs.

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Employment Contracts in IT

Most IT professionals work under detailed employment contracts. These contracts outline the rights and obligations of both the employee and the company. If you’ve been laid off, your first step is to review the contract to ensure all agreed-upon conditions were followed, including notice periods, severance pay, and other benefits.

Definition of “Workman”

While the IDA defines layoffs and offers protection for “workmen,” this term usually refers to manual labourers or technical workers in industries like manufacturing. Most IT employees, especially those in managerial or supervisory roles, are not included under this law. However, certain technical roles like developers or coders might still be considered “workmen” depending on their job duties.

Labour Court for Workmen

If you fall under the definition of “workman” as outlined by the IDA, you can take your case to the labour courts. The law specifies that a workman is someone engaged in manual, skilled, technical, or operational work. 

Employees who meet this criterion and have worked for more than 240 days in a year are entitled to protection under the IDA. This means the company cannot terminate them without following proper procedures, such as obtaining government permission.

Legal Options for Employees

Even though the IDA might not apply, employees still have legal options if they feel they’ve been laid off unfairly or if their company hasn’t followed the terms of their contract. 

If your employer doesn’t follow the agreed terms for layoffs – you can file a civil lawsuit for breach of contract. For instance, if the contract specifies a three-month severance package but the company fails to provide it, you can sue for damages under the Indian Contract Act, 1860. However, civil cases can be time-consuming and expensive.

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Compensation Rules for Lay off in Labour Law

If employees have worked continuously for 12 months or more before being laid off, they are entitled to certain benefits. According to Section 25C of the Industrial Dispute Act, they should receive half of their basic salary along with a dearness allowance (an extra amount given to help deal with the rising cost of living).

Other Relevant Laws

Several other laws also deal with laying off employees and terminations. These include:

• The Industrial Relations Code (IR Code) which covers issues related to employment terms and disputes.
• The Industrial Employment (Standing Orders) Act of 1946 (IESA) which outlines conditions for terminating employees.
• The Shops and Establishments Act (SEA) which regulates working conditions in smaller businesses, including IT companies.

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How to Avoid Tech Layoffs?

As a tech employee in India, avoiding layoffs requires proactive steps to stay valuable in your role. Here are some tips to help you stay secure if companies are laying off. 

1. Upskill Continuously

Technology evolves rapidly. Focus on learning new skills that are in demand, like AI, cloud computing, and cybersecurity. Take online courses or certifications to stay competitive.

2. Network Internally and Externally

Build strong relationships with colleagues, mentors, and industry peers. Networking increases visibility and helps you stay informed about internal opportunities or shifts in the company.

3. Show Flexibility

Be open to taking on new roles or responsibilities. Adaptability is key to demonstrating your value during uncertain times. Offering to work on projects outside your usual tasks can show your commitment.

4. Track Your Contributions

Regularly document your achievements and contributions to the team or company. This helps during performance reviews or if jobs layoffs are being discussed – giving you leverage to highlight your impact.

5. Stay Informed About the Company’s Health

Pay attention to news about IT sector layoffs and your company’s financial health. Knowing if they’re struggling can help you plan ahead, like considering job searches early.

6. Seek Feedback Regularly

Don’t wait for yearly reviews. Ask for feedback from your managers often. Use it to improve and align your work with the company’s goals.

7. Look for Better Job Opportunities

Keep an eye on job openings through platforms like Hirist. It’s an excellent resource for finding tech roles that align with your expertise and career goals.

Also Read - A Complete Guide to IT Job Fairs in India

What to Do When Laid Off?

Being laid off can be overwhelming – but it’s important to stay calm and focused on your next steps. Here’s what laid off workers can do to move forward:

1. Review Your Contract

Carefully go through your employment contract. Check if you’re entitled to severance pay, notice periods, or any other benefits when it comes to IT industry layoffs.

2. Claim Benefits

Some companies provide health insurance or severance packages. Make sure to claim all available benefits to help you during the transition period.

3. Check Legal Options

If you feel the layoff was unfair – you can explore legal remedies. Consult a lawyer to understand if your termination violated your contract or employment laws.

4. Update Your Resume

Take the time to refresh your resume. Highlight your key achievements and skills, making sure it’s ready to send to potential employers.

5. Reach Out to Your Network

Let your professional contacts know you’re available for new opportunities. Networking can open doors to job leads and recommendations.

6. Practice Self-Care

Layoffs can be stressful, so take care of your mental and physical health. Exercise, meditate, or take time to relax and recharge before diving into your job search.

7. Upskill

Use this time to learn new skills or improve existing ones. Enroll in online courses or certifications that can boost your employability during job cuts in IT sector. 

8. Explore Job Portals

Visit job platforms like Hirist to find new roles that match your expertise. Regularly check for openings in your field and apply for positions.

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What is Recession?

A recession is a period when the economy slows down for an extended time – often lasting several months. During a recession, businesses may struggle, unemployment rates rise, and people spend less money. 

A Recession in tech industry means companies face slow growth, reduced profits, and may cut jobs. Startups and big tech firms alike may struggle to stay competitive – affecting innovation and investment in new technologies during tough economic times.

The Relation between Recession and Tech Layoffs 

Recession and layoff in tech are closely linked. When the economy slows down, companies across industries, including tech – face lower demand and reduced profits. To cut costs, many tech firms reduce their workforce – leading to widespread layoffs. 

This is often seen as a necessary move to stay afloat during tough times. As a result, IT professionals can lose their jobs even if they perform well. The uncertainty in the market also causes companies to pause hiring and delay projects. The impact of the layoff recession on creates challenges for both workers and businesses – affecting the industry’s overall growth.

Also Read - Recession in IT Sector 2024-25: When Will It Start and End

IT Companies That Are Laying Off

Firing in IT companies continues in 2024 – with over 124,000 employees let go by August 20. Here’s the list of IT companies firing employees.

Company	Details of Layoffs
Microsoft	Laid off around 2,000 employees in its gaming division. Additional 1,000 jobs cut in cloud services and mixed reality.
Apple	Laid off 614 employees in California after shutting down its EV project.
Google (Alphabet)	Cut 630 jobs across hardware and advertising teams. Laid off 200 employees from core teams, including senior management.
Amazon	Laid off hundreds from Prime Video and Twitch. Additional cuts in AWS sales and marketing segments.
Intel	Cut 15,000 jobs, which is 15% of its workforce, due to declining performance.
SAP	Restructuring to eliminate nearly 8,000 roles due to AI-driven efficiencies.
IBM	Job cuts in marketing and communications teams.
Dell	Estimated layoffs of 12,500 employees, focusing on sales and marketing.
Cisco	Initially announced a 5% workforce reduction, later increased to 7%, affecting over 6,000 employees.
Salesforce	Laid off 700 employees, followed by an additional 300 later in the year.
Byju’s	Laid off around 10,000 employees over two years, continuing restructuring efforts.
Discord	Laid off 17% of its staff, impacting 170 employees due to rapid growth adjustments.
PayPal	Announced layoffs of 2,500 employees, which is 9% of its global workforce.

Wrapping Up

To wrap up, understanding tech layoffs in 2025 is important for everyone in the industry. Knowing the reasons behind these layoffs and your rights can help you prepare. If you’re looking for new jobs, visit Hirist. It’s a great place to find the best tech jobs that fit your skills and goals.

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FAQs

What are mass lay offs?

Mass lay offs refer to a large number of employees being let go at once, often due to company issues.

What are big tech layoffs?

Big tech layoffs happen when large technology companies reduce their workforce significantly, usually for financial reasons.

Are there any upcoming layoffs?

Upcoming layoffs may be announced by companies due to economic factors; stay updated through news sources.

What is corporate downsizing?

Corporate downsizing is when a company reduces its size and workforce to improve efficiency or cut costs.

What does employee retrenchment mean?

Employee retrenchment is the process of laying off workers to reduce expenses, often during tough economic times.

How can I find layoff today?

To find layoff today, check news websites or job boards that report real-time job cuts across industries.

Where can I find layoffs last 24 hours?

For layoffs last 24 hours, refer to news articles or social media updates tracking recent job cuts.

Why are start up layoffs increasing in the tech sector?

Start up layoffs are increasing in the tech sector due to rising costs, reduced funding, and market uncertainty, forcing companies to cut jobs.

What were the number of tech layoffs 2023?

In 2023, over 260,000 people were let go by more than 1,150 tech companies, according to data from Layoffs.fyi.

Are there layoffs in USA?

Yes, there are ongoing layoffs in USA across various industries, impacting many workers this year.