Laid-off techies face ‘sense of impending doom’ with job cuts at highest since dot-com crash
The Google office in New York on February 2, 2023.
Ed Jones | Afp | Getty Images
Allison Croisant, a data scientist with about a decade of experience in technology, was laid off by PayPal earlier this year, joining the masses of unemployed across her industry. Croisant has one word to describe the process of looking for a job right now: “Insane.”
“Everybody else is also getting laid off,” said Croisant, who lives in Omaha, Nebraska, where she worked remotely for PayPal.
Her sentiment is reflected in the numbers. Since the start of the year, more than 50,000 workers have been laid off from over 200 tech companies, according to tracking website Layoffs.fyi. It’s a continuation of the predominant theme of 2023, when more than 260,000 workers across nearly 1,200 tech companies lost their jobs.
Alphabet, Amazon, Meta and Microsoft have all taken part in the downsizing this year, along with eBay, Unity Software, SAP and Cisco. Wall Street has largely cheered on the cost-cutting, sending many tech stocks to record highs on optimism that spending discipline coupled with efficiency gains from artificial intelligence will lead to rising profits. PayPal announced in January that it was eliminating 9% of its workforce, or about 2,500 jobs.
For the tens of thousands of people in Croisant’s position, the path toward reemployment is daunting. All told, 2023 was the second-biggest year of cuts on record in the technology sector, behind only the dot-com crash in 2001, according to outplacement firm Challenger, Gray & Christmas. Not since the spectacular flameouts of Pets.com, eToys and Webvan have so many tech workers lost their jobs in such a short period of time.
Last month’s job cut count was the highest of any February since 2009, when the financial crisis forced companies into cash preservation mode.
CNBC spoke to a dozen people who have been laid off from tech jobs in the past year or so about their experiences navigating the labor market. Some spoke on the condition that CNBC not use their names or write about the details of their situation. Taken together, they paint a picture of an increasingly competitive market with job listings that include exacting requirements for qualification and come with lower pay than their prior gigs.
It’s a particularly confounding situation for software developers and data scientists, who just a couple of years ago had some of the most marketable and highly valued skills on the planet, and are now considering whether they need to exit the industry to find employment.
“The market isn’t what it once was,” Roger Lee, creator of Layoffs.fyi, said in an email. “To secure a new position, many salespeople and recruiters are leaving tech entirely. Even engineers are compromising — accepting roles with less stability, a tougher work environment, or lower pay and benefits.”
Lee said tech salaries have “largely stagnated” in the last two years, citing data from Comprehensive.io, a compensation tracker he recently helped launch.
Croisant’s job search involved applying for some positions that had racked up hundreds of applicants. She could see that data using LinkedIn’s Talent Insights platform, which shows how many people are vying for an open role.
Additionally, some listings required applicants to have advanced degrees or professional experience in machine learning and artificial intelligence, a new development in Croisant’s experience on the job market.
During five weeks of job hunting, Croisant said she applied to 48 openings and landed two interviews. She finally opted to accept a lower-level data analyst role and a roughly $3,000 reduction in her base pay to take a contract role starting next month at a financial technology company.
“This was an absolutely terrifying experience for me, and I’m not sure if I’ll ever truly feel secure in a job again,” Croisant said. “But I’m still one of the lucky ones in the end. I have friends who’ve been looking for months and still haven’t found anything.”
‘It’s humbling’
Krysten Powers was laid off in January from travel tech startup Flyr after two years in marketing at the company. She said navigating the current labor market is like a full-time job, “sometimes even harder.”
“You’re putting out resumes and getting almost immediate rejections,” said Powers, who’s worked in marketing for a decade. “It does take a toll on your confidence and you get this sort of imposter syndrome.”
Powers lives with her husband and two kids in the small town of Natchez, Mississippi. A month before she lost her job, her family bought a new house. Powers said moving isn’t an option, and she’s only considering remote roles in marketing. However, she is willing to accept a pay cut.
“It’s humbling for sure,” she said.
Google Headquarters is seen in Mountain View, California, United States on May 15, 2023.
Tayfun Coskun | Anadolu Agency | Getty Images
The same dynamics are playing out across the industry, even for former employees of Google, which was long considered the home of Silicon Valley’s elite talent.
Christopher Fong, who worked at Google from 2006 to 2015, is the founder of a group called Xoogler.co, which seeks to provide help for people laid off from the internet company. The 9-year-old organization, consisting of thousands of Google alumni and current staffers, offers peer support and hundreds of in-person events.
In January, Google eliminated several hundred positions across its hardware, central engineering and Google Assistant teams. A year earlier, the company cut 12,000 jobs, or roughly 6% of its full-time workforce.
Fong said the “biggest challenge” today for many ex-Google employees is finding a job that maintains their previous level of pay.
Michael Kascsak, who was laid off by Google in March of last year, took a different approach to his job search.
Kascsak said he welcomed a pay cut to start as head of talent acquisition for veterinary business CityVet in January after applying for hundreds of jobs. He acknowledged that his previous employer had set exceptionally high compensation expectations.
“I went into this knowing I had been fortunate to work at a company that paid at the top percentile and I’m a realist. I prepared myself to be flexible,” said Kascsak, who lives in Austin, Texas, and previously worked in talent sourcing for Google. “I’m fine with the pay now because I’m in the environment I want to be in with great people.”
Tech is a notable outlier in a labor market that’s been largely steady over the past two years. Nationwide, the unemployment rate ticked up to 3.9% in February from 3.7% each of the prior three months. It’s been mostly in that range since early 2022. The U.S. economy added 275,000 jobs in February, topping 200,000 for a third straight month.
Booming market for AI engineers
Sentiment indexes are mixed. Job review website Glassdoor’s Employee Confidence Index, which gauges how employees feel about their employer’s six-month business outlook, sank to its lowest level in February since its sentiment data first began in 2016. Among tech workers, discussions about layoffs on Glassdoor have more than quadrupled in the past two years, and were up 12% last month compared with a year earlier.
However, ZipRecruiter’s Job Seeker Confidence Index has been rising since mid-2023, and increased to its highest level in the fourth quarter since the second quarter of 2022.
Even within tech, there’s a vast divide in the current market. Lee of Layoffs.fyi said AI is driving a “return to rapid hiring and expansion,” even as layoffs continue elsewhere. Salaries for AI engineers rose 12% from the third to fourth quarter last year, and the average salary for a senior AI engineer nationally is more than $190,000, according to Comprehensive.io.
Amit Mittal was laid off from AI lending company Upstart
Amit Mittal
Amit Mittal has been on both sides of the employment market — previously as a hiring manager and now as a job seeker.
In November, Mittal was laid off from AI lending company Upstart, where he worked as a software engineering manager, often overseeing interviews. Mittal said he witnessed the hiring process become “a lot more demanding” as layoffs surged.
“There was a lot more pressure on us to basically raise the bar higher and higher,” he said. “Somebody with a four-year experience in the past would have had a pretty good chance at getting a good job. But now they’re competing against people who have six, seven, eight years of experience for the same position.”
Mittal, who’s from India and has lived in the Chicago area since 2007, has lately been subject to a very different kind of pressure. Under his H-1B visa, Mittal had only 60 days from the official end of his employment to find a new job in the tech industry in order to stay in the country.
“If for four months, I have to pay my bills by driving an Uber or working at McDonald’s flipping burgers, that’s fine,” he said. “But that mechanism doesn’t exist for me.”
Mittal has now successfully petitioned to obtain a separate B-2 tourist visa, giving him an extra six months to find new employment. It wasn’t a cheap effort, though. He estimated he spent around $8,000 on legal and administrative costs tied to his submission.
All the while, Mittal said he’s applied for about 110 jobs to no avail. He attributed the dearth of success to employers’ reluctance or inability to sponsor visa holders.
“It seems like the possibilities are pretty slim right now, even though I see hundreds of postings every single day,” Mittal said.
Bill Vezey was laid off by eBay in January following a 13-year career as a software engineer at the online retailer. He said he’s learning the rules of the “new game,” and they’re much different than he remembers.
“Attainability is not just a numbers game,” said Vezey, 64, who lives in Santa Cruz, California. “It is a combination of how well you brand yourself, about your access through networking to any given position — to the hidden job market.”
Vezey said he hopes to be rehired at his longtime employer and wants to remain in tech.
“I am kind of an incurable optimist, despite what 60-odd years of living have brought,” he said.
Like many of those who spoke to CNBC, Powers said she spends her days tailoring her resume for openings, scanning online job boards and applying for newly posted positions. She networks by contacting a recruiter or hiring manager connected to each role, though she said some recruiters have ghosted her as quickly as they’ve expressed interest.
She’s had a few interviews, and turned down one job offer. That position would’ve required her to go to an office while taking a more than 50% pay cut from her previous job. And she’d have to find child care.
“There’s a sense of impending doom,” Powers said. “There is a point where the money runs out and the options become really bleak.”
Still, Powers said she’s trying to stay optimistic, “because giving up is not going to get me a job.”
— CNBC’s Jennifer Elias contributed to this report.
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The Xbox booth during the Gamescom video games trade fair at the Trade Fair Center in Cologne, Germany, Aug. 20, 2025.
Ina Fassbender | Afp | Getty Images
Microsoft’s Xbox has had a tumultuous year.
A slew of layoffs, price hikes and studio closures have led many to declare — not for the first time — that the Xbox is dead.
Laura Fryer, former executive producer at Microsoft Game Studios, said in June that the company seems to have “no desire or literally can’t ship hardware anymore.”
Former Microsoft executive and ex-Blizzard Entertainment president Mike Ybarra slammed Xbox’s “confusing” strategy in a now-deleted X post in October, saying the company is potentially heading for a “death by a thousand needles.”
The company’s overall gaming revenue decreased 2% year-over-year, with a 29% dip in Xbox hardware sales, according to Microsoft’s first-quarter earnings for fiscal 2026.
The broader console industry has been in a major slump, with hardware spending down 27% year-over-year in November, which is typically a busy shopping month, according to a recent report from research firm Circana.
It was the worst November in two decades, IGN reported, citing Circana data.
Combined Switch and Switch 2 unit sales were down more than 10% during the month and PS5 sales were down more than 40%, IGN said. But the Xbox Series hardware took the biggest beating, with a dramatic 70% drop in sales.
In console sales, Xbox can barely see the leaders this year.
Nintendo‘s Switch 2 has sold 10.36 million units since its debut in June, the company said in its latest earnings report. Sony‘s PlayStation 5 had 9.2 million units sold in 2025, according to its most recent financial results.
Microsoft’s Xbox Series S and Series X, at 1.7 million units, couldn’t outsell the original Nintendo Switch, which launched in 2017 and has sold 3.4 million units so far this year, data from game sales tracking site VGChartz estimated.
Microsoft declined to comment on Xbox sales or numbers.
The company stopped reporting console unit shipments in 2015 as the gap between Xbox and PlayStation widened.
The Series S, Series X and PS5 all originally released in 2020, with some updates being released since then.
In November, Valve made a splash with its next-generation Steam Machine, which is set to launch next year.
The reveal of its console-PC hybrid generated buzz across the gaming landscape, with The Verge declaring that “Valve just built the Xbox that Microsoft is dreaming of.”
The mini cube will be able to run Windows PC games through Valve’s own Linux-based SteamOS as a television console or as a gaming computer. Gamers will have access to Steam’s extensive library of thousands of games.
But Microsoft doesn’t seem too worried about falling behind.
“We’re not in the business of out-consoling Sony or out-consoling Nintendo. There isn’t really a great solution or win for us,” Microsoft Gaming CEO Phil Spencer said in a 2023 podcast.
In congratulating Valve on the release, the Xbox boss gave a nod to the movement to expand gaming access “across PC, console and handheld devices.”
As Sony and Nintendo have firmly established themselves as hardware companies, Microsoft is pushing toward Bill Gates’ original vision of an all-encompassing entertainment hub in the living room.
“Ultimately, the addressable market is anybody who wants to play games, and Microsoft wants to serve that market,” Wedbush analyst Michael Pachter told CNBC.
Microsoft CEO Satya Nadella said in a recent interview with the TBPN podcast that the company’s gaming business model will look to be “everywhere in every platform,” from consoles to TV to mobile.
His comments also hinted that the next Xbox may function more like a PC.
“It’s kind of funny people think about the console and PC as two different things,” Nadella said. “We built a console because we wanted to build a better PC, which could then perform for gaming. So I kind of want to revisit some of that conventional wisdom.”
Xbox President Sarah Bond echoed the idea, saying in a recent interview with Mashable that the company’s next-generation console will have “some of the thinking” seen in the Xbox’s new handhelds, which were built by hardware manufacturer Asus in partnership with Microsoft.
Launched in October, those devices support cross-platform gaming and can run PC games bought from Epic Games, CD Projekt and Valve stores.
Xbox has already incorporated that approach into the latest Backbone Pro, which rolled out in November.
Designed in partnership with Backbone Labs, the portable gaming controller offers access to cloud gaming on mobile, PC, smart TV and other streaming devices.
So what will Microsoft’s new-gen console look like?
Little is known about where the company is at in its development.
A source familiar with Xbox strategy told CNBC that the company is looking at creating an open system that enables players to jump between console, PC and cloud gaming — and any form of entertainment beyond gaming.
Gaming in the cloud
Pachter said that while Microsoft is not completely abandoning hardware, the company is splitting its audience into existing buyers interested in specialized consoles and everyone else.
In a 2019 interview with The Verge, Spencer said that he was not concerned with focusing on console sales as much as making games accessible.
“I do think as we look at the next decade of gaming, as we think about reaching the over 2 billion people on the planet who play games, many of those people won’t be buying consoles and gaming PCs,” Spencer said.
Xbox Game Pass subscription service, which gives subscribers access to games from a variety of publishers, is a clear example of this strategy.
Microsoft has been steadily expanding its title offerings on the service.
The platform’s most basic tier, Game Pass Essential (previously Game Pass Core), which costs $9.99 and launched in 2023 with 36 games, now offers over 50 titles.
Ultimate tier members have access to over 500 titles.
Sarah Bond, head of Xbox partnerships, speaks about Xbox Game Pass during the Microsoft Corp. Xbox event ahead of the E3 Electronic Entertainment Expo in Los Angeles, June 9, 2019.
Patrick T. Fallon | Bloomberg | Getty Images
The growth in cloud gaming has been blistering.
Xbox reported a record 34 million Game Pass subscribers in 2024 and a total Game Pass revenue of almost $5 billion over the last fiscal year.
Xbox said in a November blog post that the number of cloud gaming hours from Game Pass subscribers was up 45% compared to the same time last year. The Microsoft subsidiary also said console players are “spending 45% more time cloud streaming on console and 24% more on other devices.”
In announcing the benchmark, the platform added that Xbox Cloud Gaming is now in 30 countries with the expansion into India, which it called “the fastest-growing gaming market in the world,” home to more than 500 million gamers this year.
Although Microsoft faced heavy criticism from subscribers after increasing the cost of its Ultimate tier by 50% from $19.99 to $29.99 in October, the company is reportedly testing an ad-supported version of Xbox Cloud Gaming.
Omdia senior principal analyst George Jijiashvili told CNBC that a free Game Pass tier would likely act as a user-acquisition tool, especially for gamers who have not invested in consoles yet.
However, due to the high costs associated with cloud gaming, an ad-supported tier would likely not be able to actually drive a meaningful amount of revenue, he said.
Cloud gaming is inherently difficult to scale since it needs to balance computing power and operating costs with user affordability.
“With console-grade cloud gaming, you need to essentially run every single instance of the game in a server,” Jijiashvili said. “You need a dedicated hardware for every single person that’s streaming the game, meaning it just doesn’t scale.”
Despite gaming’s scaling limitations, Microsoft seems committed to doing what it has done with the rest of its products — moving it to the cloud.
“They’ve evolved into a primarily cloud services company,” Pachter said. “So everything they’ve done since they started acquiring studios at Xbox has been toward the connected experience in the home to view entertainment.”
Game studio bonanza
Microsoft has spent the past few years building out its entertainment hub with a catalog of original games through an acquisition blitz.
In 2018, the software giant more than doubled its game studios with a string of acquisitions that included Ninja Theory, inXile Entertainment and Obsidian Entertainment.
Two years later, Microsoft bought ZeniMax Media, which owned Bethesda, for $8.1 billion. It was the company’s largest gaming acquisition until its 2023 purchase of Activision Blizzard for $75.4 billion.
Pachter said that the software giant’s gaming spree was also a move to collect “enough content” to bolster its cloud gaming services.
Yet Microsoft’s approach to using its roster of exclusive titles has seen a stark shift recently.
As Xbox exclusives still struggled to compete with wildly successful PlayStation games like “Marvel’s Spider-Man” and “God of War,” the company has made a definitive pivot away from its original-content strategy.
Bond recently said in an interview with Mashable that the idea of exclusive games is “antiquated” as the company has leaned into cross-platform gaming.
Microsoft announced in October that the upcoming “Halo” game will be available on Sony’s PlayStation 5, marking the first time the major franchise has become accessible on a competing console.
In 2024, Xbox opened four formerly exclusive games to other consoles.
Spencer said at the time that the move did not indicate a change in Xbox’s exclusive strategy, but the company has since continued to bring several former exclusives to rival platforms.
In a January interview, Spencer said that the company won’t “put walls up” where users can engage with Xbox games.
“What we’ve learned is put the games first, make sure the games can be as great as they can,” he said. “We love the experience on our own hardware, on our own platform, but our games will show up in more and more places.”
Cuts and price jumps
Microsoft laid off 1,900 workers, around 9% of its gaming division, in January and slashed another 650 jobs from Xbox in September.
In May, the company also shut down several studios under game publisher Bethesda, including “Redfall” maker Arkane Austin and “Mighty Doom” developer Alpha Dog Games.
The gaming unit was hit again when company-wide layoffs in July led to Microsoft shelving “Perfect Dark” and “Everwild,” games that have reportedly been in development for at least seven years, as well as multiple unannounced projects.
Some have attributed the cost-cutting measures to mounting pressure to hit lofty profit goals.
The company reportedly asked its gaming division in 2023 to target profit margins of 30%, according to Bloomberg, which cited people familiar with the matter.
The goal was a significant jump from the 12% profit margin Xbox reached in 2022, as revealed in court documents, and well above the average video-game industry standard of 17% to 22%, analysts told Bloomberg.
Microsoft told CNBC that while the company does set ambitious goals, the reported 30% profit margin target was incorrect.
Microsoft has raised prices on its aging lineup of flagship consoles twice over the past year. Nintendo and Sony also announced price hikes for their respective consoles in August.
The PS5 currently starts at $549.99, and the original Nintendo Switch and Nintendo Switch 2 cost $399.99 and $499.99, respectively.
Xbox’s new ROG Xbox Ally and ROG Xbox Ally X were priced at $599.99 and a staggering $999.99, respectively.
With a growing number of consoles and handhelds in the market, competition is fierce for a dedicated group of customers that will always be interested in owning hardware.
But Xbox is betting that cloud and cross-platform gaming are the future.
For a decade, claims have been made about the death of the Xbox, and what comes next could fully spell the end, or bring a metamorphosis.
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