(Bloomberg) — Turns out they weren't done.
If the first month of 2024 offers any indication, America's largest employers — fresh off mass layoffs last year — are going to keep cutting. In just the past few weeks, Alphabet, Amazon, Citigroup, Ebay, Macy's, Microsoft, Shell, Sports Illustrated, and Wayfair have all announced job cuts.
On Tuesday, United Parcel Service said it plans to cut 12,000 jobs and call workers back to the office five days a week.
The layoffs come as the economy is sending mixed signals. On one hand, US job openings just rose to a three-month high. Stocks are near an all-time high, once again fueling talk of an economic soft landing. And a key gauge of US consumer sentiment recently jumped by the most since 2005.
On the other hand, the growing list of high-profile job cuts is adding a jolt of uncertainty to the white-collar world where fears of a recession and displacement by generative artificial intelligence have become standard water-cooler discussion. The growing crackdown on remote work is also causing anxiety.
"It creates a ripple effect and a fear factor," said Ariel Schur, chief executive officer of ABS Staffing Solutions in New York.
How worried should you be about your job? Bloomberg News interviewed economists, recruiters, consultants and career coaches across the country to assess the current state of the job market and get strategies for navigating it. Here is what they said:
Who is likely to be cut?
Middle managers and remote workers beware.
"Companies often target middle management for cuts. They try to streamline," said Daniel Zhao, lead economist at Glassdoor. "Middle managers are often squeezed from both sides at a time like this. They're often cut but they're also often responsible for implementing these measures to get more efficient."
At the same time, the current round of layoffs has highlighted the vulnerabilities of remote workers. Some reports have indicated that employers would target remote workers at a time when many companies are trying to bring staff back into the office.
"Being remote makes it easier to let you go," Schur said. "You don't have that day-to-day interaction. It's easier on a human level to let go of someone. It's easier to utilize that as a rationale for layoffs."
George Penn, a managing vice president at the consulting firm Gartner, said the best firms ask two questions when considering whom to lay off: Is the employee making money for the firm now? And will the employee make money for the firm in the future? Someone who can't answer "yes" to either question should tread carefully.
What can you do to prepare?
That's the suggestion of Daniel Keum, associate professor of management at Columbia Business School, gives to employees anxious about their positions in the current climate.
"The era of remote work is in decline. If the work can be done remotely, it can be moved abroad," he said. "Show up, show commitment."
Monique Valcour, an executive coach, emphasized the importance of quality in workplace interactions during a period of uncertainty. It can be really tempting for anxious employees to spend time trying to read the tea leaves of what management is thinking and where the ax may fall. But "sharing low-quality information and organizational gossip is unproductive," she said.
Instead, Valcour recommended employees work to build solid relationships with management, avoid spreading themselves too thin, make the commitments they already have count and embrace some of the change that may be coming their way.
"Uncertainty," she said. "Is part of what it means to have a career."
It's a storm not a tsunami
The cuts are unsettling, but many economists said workers shouldn't worry too much, as long as recent economic trends persist.
"We're getting a lot of stories about a specific chunk" of the labor market, said Heidi Shierholz, president of the Economic Policy Institute in Washington, DC. By and large, blue-collar jobs have been in good shape — it's the white-collar, professional services jobs in areas such as finance and technology that have been struggling. "But that level of layoffs is actually a normal part of our labor market," she said.
Some of this is seasonal
Penn, who advises firms on workforce planning, redesign and restriction, said the level of layoffs so far isn't meaningfully different from prior years. Much of this comes down to how companies plan over the course of the year.
"December and January are the periods in which layoffs typically happen," Penn said. "They're going to clean up and fix anything budgetary from the prior year, or they're looking to sort out and position themselves for the year ahead."
Many firms — particularly in tech — overhired during the pandemic. Some are still correcting for that. It's in this context that Lauren Goodwin, chief market strategist at New York Life Investments, said the layoffs she's seen have been "more about normalizing" rather than a "profit-driven set of layoffs."
Some of this is cyclical
Still, some layoffs appear connected to the current business climate in which interest rates are high but widely expected to fall at some point later this year.
"Firms are also repositioning and reorienting and reorganizing for growth," Keum said. "Broadly every division and company is looking to grow, but growth has become a lot more expensive because interest rates are high, and there's uncertainty about when they will come down."
That uncertainty, combined with a desire to grow, has led to one of the more befuddling trends of the current labor market: layoffs at the same time as opportunistic hiring in certain segments such as AI.