It's been a tough year for tech so far. Deals have dropped over 30 percent from 2015, and it took months before we saw the first company go public. The down market has also affected jobs, with a number of big companies downsizing their workforces.
The latest to make cuts is Cisco, which announced on Wednesday that it would be eliminating up to 5,500 positions, representing approximately 7 percent of its global workforce.
The reason, the company said, was so that it could better focus on specific areas of growth, including security, IoT, collaboration, next generation data center and the cloud.
"Today's market requires Cisco and our customers to be decisive, move with greater speed and drive more innovation than we've seen in our history," the company wrote. "We expect to reinvest substantially all of the cost savings from these actions back into these businesses and will continue to aggressively invest to focus on our areas of future growth."
The cuts will begin in the first quarter of fiscal 2017, which is actually next quarter.
Layoffs in 2016
Right from the start, 2016 was a going to be a tough year for employees in the U.S. There were 250,061 jobs cut through the first four months of 2016 across all sectors, a 24 percent increase from the 201,796 in the first four months of 2015. It is the highest January to April total since 2009, when 695,100 jobs were cut.
The tech sector in particular is going to be pretty hard, with projections of 260,000 job cuts in that space alone.
Already a number of big tech companies have announced big layoffs this year, including IBM, which fired an approximated 14,000 workers in March, while Intel confirmed that it laid off 11 percent of its workforce in April, totaling 12,000 workers.
Intel's cuts were so massive, in fact, that it ranked among the largest cuts in the tech industry ever.
Zenefits announced it was reducing its headcount by roughly 250 employees, or about 17 percent of total employees, in February, Those cuts came came almost entirely to its Sales organization, with about a dozen employees in Recruiting. In March, wearables company Pebble cut 25 percent of its staff, or 40 employees, and Microsoft got rid of 1,850 jobs in its smartphone unit in May.
The job cuts are not expected to stop any time soon either.
"The hi-tech industry is going through a serious deconstruction," Trip Chowdhry, an analyst at Global Equities Research, told Reuters in the wake of the Cisco layoffs. "There is more pain to come."
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