The Mass Layoffs Are Starting

A Recession in 2023 Looks All But Inevitable Now

With all the recent rate hikes by the Federal Reserve, the energy crisis in Europe that seems to be spilling over into the global economy and not to mention, the $15 billion implosion of FTX, the economic forecast for 2023 isn’t looking particularly good right now.

But as my friend Joe Splitrock noted, “All the people saying we are not in a recession because of the strong job market, just learned that employment is a lagging factor.” And now we’re seeing the mass layoffs, particularly in the tech sector.

It's not just the 11,000 at Facebook (for the Meta catastrophe) or the 4000 at Twitter (from Musk's major reshuffling), it's all over the place, for example:

- Zillow layoffs: 5% of workforce laid off (October, 2022)

- Peloton layoffs: 12% of workforce laid off (October, 2022)

- DocuSign layoffs: 9% of workforce laid off (September, 2022)

- Snapchat layoffs: 20% of workforce laid off (September, 2022)

- MasterClass layoffs: 20% of workforce laid off (June, 2022)

- Robinhood layoffs: 9% of workforce laid off (April, 2022)

And it's not just that. Ford, 7-11, Shopify, Vimeo and Tesla have also had layoffs. Indeed, just this morning Amazon announced it would be laying off 10,000 workers.

And we're certainly going to see layoffs in construction as well as real estate agents and mortgage brokers changing professions as the real estate market freezes.

The Fed made it clear they were willing to throw the economy into recession in order to quell inflation. Well, I think it's safe to say the Fed is going to get the recession they're aiming for.