Internet services company New Relic recently announced that it will be cutting 110 positions, 90 of which will be in the United States, in order to re-strategize and allocate resources to essential objectives. This latest layoff in Oregon and Southwest Washington comes after a spate of them.
According to New Relic, charges related to the cuts and other re-organizational expenses might total up to $9.3 million. The reductions affect about 5% of its personnel. Bill Staples, CEO of New Relic, stated in a letter to staff that was published on the company’s website. The statement essentially communicated that the layoffs were a sad consequence that hurts the lives of individuals New Relic cares about, but the CEO felt this was the right move to take.” Staples said that after taking a new look at the organization’s aims and development prospects, the cutbacks were inevitable.
New Relic’s Measures to Soften the Blow
The software from New Relic enables businesses to track user activity on websites and other online resources, providing information that customers can use to improve performance. Though its technical office is located in Portland’s downtown, New Relic’s corporate offices are in San Francisco.
With up to 600 employees allocated to its offices at the U.S. Bancorp Tower, the company has long been one of the major technology employers in the area. How many now work in Portland is unknown. According to New Relic, the company now offers its staff members the choice to work from home or in a hybrid setting. The business said recently that it’s continuing to hire for positions in its Portland office and invest in it.
In an effort to boost its financial performance, the firm has undergone a number of significant structural changes over the past two years, including removing its CEO and updating its pricing strategy. In a preceding reorganization in April 2021, 160 employees were let go.
According to New Relic, those let go on Thursday would get three months’ worth of severance compensation along with bonuses and incentives. Employees who are laid off in the United States will still be eligible for health coverage for six months and can even retain their office computers.
Other Companies that Recently Laid Off Employees
In early trading on Thursday, shares of New Relic decreased 2.7% to $65.27. In the last year, the stock has ranged in price from $41.66 to $129.70. In recent weeks, a lot of IT businesses have reduced hiring or laid off employees in preparation for tougher economic circumstances. This summer, Portland-based IT companies Puppet and Smarsh both let go of staff, and last month, Corvallis-based contract manufacturers employed by HP Inc. were placed on leave. A few dozen employees at the biotech business Absci in Vancouver were let go last week as it reversed a recruiting frenzy.
Chip Manufacturers Still on the Up
However, despite Oregon’s historically low unemployment rate of 3.5%, several technology firms are discussing expansion rather than job cuts. In spite of a persistent scarcity of some types of computer chips, chip manufacturers and semiconductor equipment producers continue to hire quickly. This month, SEH America announced that it will expand the production floor at its Vancouver silicon wafer facility by 300,000 square feet.
Unfortunately, this impending recession has hit hard not only in the US, but globally. This leads to tough decision-making from C-level management, where employees need to be made redundant, in a bid to cut costs and recalibrate company visions and priorities.
With all this being said, there are some industries that have still been going strong despite the unforgiving realities a post-pandemic economy has presented and unraveled. Case in point, the iGaming sector and top tier affiliate marketing companies like NoDepositWorld. Of course, this is not to say all firms within the business haven’t been hit hard.
Is the US in a Recession?
For many Americans, the recession is the most pressing issue. However, how can we tell whether the US is actually in a recession? Technically, a country enters a recession when its GDP (Gross Domestic Product), which measures the total value of all goods and services produced over a certain time period, decreases for two consecutive quarters. Results released recently confirmed this: the Bureau of Economic Analysis’ advanced estimate indicated that GDP fell by 1.6% in Q1 and 0.9% in Q2.
Even while all indications lead to a recession, the National Bureau of Economic Research, which makes this determination in the US, has not yet declared one. But it seems like a question of technicality whether we can or cannot term this time period a recession. Ultimately, as prices keep rising, borrowing costs climb, and job losses spread across the nation, average Americans are hurting.
The job market may seem to be the only solid aspect of the economy at the moment with the unemployment rate at 3.6%. But given that businesses are already starting to announce layoffs in response to the present economic headwinds, which include inflation, increasing interest rates, and falling consumer demand, the job market stability is probably only a transitory situation.